Overview
The auto sector wants import restrictions lifted due to a serious lack of foreign exchange and supply. Constraints in components, local car manufacturers, and suppliers are paralyzing.
Import Restrictions Lifted Joint Letter
The Pakistan Automotive Manufacturers Association (PAMA) and the Pakistan Association of Automotive Parts and Accessories Manufacturers (PAAPAM) informed State Bank of Pakistan Governor Jameel Ahmed in a joint letter. That the industry was on the verge of extinction due to SBP restrictions and a lack of cooperation from banks.
As a result, factories are closing periodically and workers are being laid off by both assemblers and their vendors. If no remedial steps are adopting, this scenario will result in widespread unemployment, loss of government income, the closure of car assembly factories, and capital flight.
According to PAMA and PAAPAM, the primary reason. The aforesaid industrial breakdown is the direct and indirect constraints impose on the opening of letters of credit (LCs).
According to the Pakistan Bureau of Statistics (PBS), imports of completely knocked down (CKD) automobile kits fell 38% to $499 million. In the first six months of FY2023 from $808 million in the same period the previous fiscal year.
