Pakistan Plans To Enhance Its Annual Automobile Production From Existing 250,000 Units To Around Six To Eight Million Units In Five Years
Pakistan plans to enhance its annual automobile production from the existing 250,000 units to around six to eight million units during the next five years, Pakistan’s Ambassador to China, Moin ul Haque said. “It is a bit ambitious target but it is possible to achieve this target due to the yearly growth in production, as well as interest showed by various automobile companies from across the world, especially from China, which plans to invest in Pakistan,” he said, while addressing the Pakistan Automobile Industry Roundtable Seminar held at the Pakistan Embassy, Beijing. The representatives of over 50 renowned automobile companies from different parts of China attended the seminar. The ambassador said a number of Chinese companies were already in Pakistan in the automobile manufacturing sector, while up to 10 new companies have shown interest to invest in Pakistan and are in the process of having joint ventures with their local partners in the private sector. The government is formulating a new and very attractive automobile sector policy, which will be announced soon, he said, adding that more incentives and concessions in taxes are likely to be offered in the new policy.
Ambassador Haque said that the automobile companies, including manufacturers of energy vehicles from China will be invited to set up their plants both in the Greenfield and Brownfield sectors. Giving details about the automobile sector in Pakistan, he said automobile is the fastest growing sector in Pakistan because of the large demand in view of the population, which is close to 220 million. In the past, the Japanese manufacturers had set up their annual automobile production units but in the recent times, the Chinese automobile companies also started looking at the opportunities available in Pakistan. The ambassador said China is now becoming one of the leaders of automobile manufacturers in the world with very high quality products and expressed the pleasure that the Chinese companies have also entered in the Pakistani automobile market. Sharing the opportunities under the China-Pakistan Economic Corridor (CPEC), he said, the flagship project of the Belt and Road Initiative (BRI) has entered into the second phase, which is focusing on industrialisation, science and technology and agriculture sectors.
“We are setting up special economic zones where we are inviting the Chinese investors to come and set up their manufacturing units,” he added. Ambassador Haque said that special incentives and policies have been announced for the Chinese companies and so far close to 100 Chinese companies are in the process of establishing their units in the special zones. The infrastructure like roads, highways and communication network is being upgraded in Pakistan, he said and invited the Chinese companies to take advantage of all these incentives and expand their presence. Welcoming the representatives of the automobile companies, Commercial Counsellor Badar uz Zaman said that the new automobile policy for 2021/26 will soon be announced, offering more incentives and benefits to the local and foreign investors.
Under the current annual automobile production policy, a number of new companies, particularly Chinese manufacturers entered in the Pakistani market. Zaman said that a number of Chinese companies were already setting up their businesses in Pakistan, while some new companies are keen to invest in Pakistan, owing to investment-friendly policies offered by the present government. The government has formulated rules and regulations, which support the foreign investment in Pakistan, he added. Zaman also shared details of the incentives, concessions in the taxation and easy repatriation of profits. “Many local companies listed with the stock exchange are very keen and are looking forward to the Chinese partners for joint ventures,” he added.
There are over 600 auto parts manufacturers who are also supplying the parts to the existing players, he said, adding: “We offer very comprehensive auto financing policies and the banks are very active. And the amount that has been financed in cars is three times more than the housing finance in Pakistan.” The commercial counsellor also shared with the companies the details of concessions on taxes, duties, particularly cheap labour. He said, in the current global scenario, when there is a supply chain shock, and it is difficult to move things from one place to another, it is the right time for the Chinese investors to take advantage of Pakistan’s location, low wages and other benefits.
Later, representatives of the companies who were already operating in Pakistan shared their experiences and put forward some useful proposals. Some new companies, which plan to enter the Pakistani automobile industry, asked questions and more details about the policies. The representatives of Anhui Jianghuai Automobile Group, Beijing Henrey Auto, Hozon New Energy Automobile, BAIC Intl, Great Wall Motor Company, Beijing Sanxing Automobile, Foton Motor Group, Tianjin Tianqi Group Meiya Automobile, Zhongtong Bus Holding Co, Youtong Bus, Dongfeng Motor Company, Jiangxi Jiangling Motor, Xiamen Golden Dragon Bus Co, Liaoning Aerospace Automobile Co, Volkswagen Group, Geely Automobile International Corporation and others attended the seminar.
This news was originally published at APP