Rickshaw maker-turned automobile producer Sazgar Engineering Works Limited will commence commercial production of its BAIC vehicles from next month, the company informed in a filing to the Pakistan Stock Exchange (PSX) on Friday.

“We are pleased to inform you that after successful completion of trial operation, the commercial production of the BAIC vehicles will be commenced with effect from September 1 2021,” said the company.

The development comes as Pakistan looks to promote industrial production in the country. The government is also aiming to increase Pakistan's auto production to 300,000 per year, and remains optimistic that policy initiatives including tax relief measures announced in the budget for the ongoing fiscal year will help achieve it.

Back in March, Sazgar signed an agreement with a Chinese automaker for the manufacture of passenger and commercial vehicles.

Sazgar Engineering Works awarded 'Greenfield Investment status'

The company informed that the agreement is for the manufacture/assembly, sales, and after-sales service of passenger and commercial vehicles.

Earlier in January, Sazgar announced its intention to enter the Pakistani car market with BAIC D20 that has a hatchback and a sedan version. The BAIC group is the third largest automotive group in China, which sells 3.5 million cars per annum.

It was learnt that Sazgar will be locally assembling its four cars under the green-field status, which the company received under the previous Auto Development Policy 2016-21, alongside other car manufacturers like Kia, United Motors, Regal Motors, MG Motors, Changan, Proton, Hyundai and Volkswagen.

Last month, Sazgar was awarded the 'Category-A, Greenfield Investment status' by the Ministry of Industries & Production of Pakistan.

The ministry also approved the Great Wall Motors Company Limited as the second principal for the assembly manufacture of GWM HAVAL vehicles in addition to BAIC vehicles.