The engineering industry on Wednesday asked to establish materials bank for timely supply of engineering raw materials to industry. In a meeting held here it was observed that engineering industry was meeting its raw material needs mostly through imports, and its competitiveness is greatly affected by prices, timely non-availability, poor quality and the inventory cost.
The quality of finished products is also based on meeting the specifications of the customers, said a statement issued by the Engineering Development Board. It said that vulnerability of the industry to international price shocks and exchange rate was also highlighted in the meeting.
The meeting was informed that import of steel-related materials are subjected to obtaining an NOC from the Pakistan Steel Mills to satisfy customs that these grades are not manufactured locally. The industry offered to establish materials banks in the private sector, provided a regulatory and an enabling environment is extended by the government to the entrepreneurs to come forward, invest, and do business on sustainable basis.
The materials banks should be granted the status of 'bonded warehouse' and sales be allowed against duty concessions. It was observed that oil and gas sector meets its material needs from imports, which may be allowed for contract manufacturing from the local vendors. Incentives to A-grade material stockists were recommended to meet the requirements of small and mediumenterprises (SMEs) which are constrained to buy substandard and out of specification material locally due to financial problems and lack of proper know-how.
Material testing facilities were urged in all main industrial cities to overcome frequent material quality issues. The meeting also stressed the need to simplify the issuance of IORs and permission to import raw material, sub-components and components against duty concession under various concessionaire facilities to be linked to sales tax registration approvals.