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  • News Desk
  • Nov 21st, 2017
  • Comments Off on Inclusion of auto sector in FTAs: PAAPAM opposes government’s proposal
The Pakistan Association of Automotive Parts & Accessories Manufacturers has expressed serious concerns on the government's proposal to include the auto sector in Free Trade Agreements (FTAs) with Turkey, Thailand & other countries. It said the Auto Development Policy (ADP), issued by ECC on 21st March, 2016, is the sole authentic document that governs the future policy for the auto sector. Including auto sector in any FTA would discredit the Government and scare away massive investments in the pipeline. Firstly, for localized parts, offering concessionary customs duties in the FTAs is incomprehensible, as it would shut down the entire Auto Parts Industry.

Secondly, for non-localized CKD parts, FTA duties would deprive the exchequer of huge sums of tax revenues and also eliminate the potential of future localization of CKD parts. PAAPAM Chairman Iftikhar Ahmad along with Senior Vice Chairman Muhammad Ashraf Sheikh held a meeting with Federal Secretary for Commerce in Islamabad the other day and briefed him about the multiple problems being faced by the auto sector.

Iftikhar Ahmad appraised the Secretary Commerce that PAAPAM was the major opponent of used car's liberal import policy on the apprehensions that this will open up flood gates of used auto parts import, which has now come to pass.

He said it is a common knowledge that the Personal Baggage, Gift & Transfer of Residence Schemes, that were meant to facilitate overseas Pakistanis, have been grossly misused and circumvented to undertake de-facto commercial import of used cars by unscrupulous dealers on passports of overseas Pakistanis. Now these elements are pressing Ministry of Commerce for making soft policy on import of used auto parts which will be drastic for auto industry, he warned.

Iftikhar Ahmad also took the issue of Regulatory Duties & Anti-Dumping Duties on steel products and requested that all imports of raw materials by the auto parts industry under SRO 655(I)/2006 be exempted from levy of Regulatory Duty under SRO 1035(I)/2017 in view of rising prices of steel products in international market. Federal Secretary assured PAAPAM delegation for sympathetic consideration of the issues related to auto industry

Senior Vice Chairman requested for induction of PAAPAM representatives in Export Development Fund Committee to meet their long outstanding demand. He also drew the attention of Secretary Commerce to mechanism of 'mid-term policy review' built in the ADP 2016-21 document and sought help for its review.

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