Letter sent to PM: PAMA seeks urgent announcement of new auto policy

ISLAMABAD: The Pakistan Automotive Manufacturers Association (PAMA), in a letter to Prime Minister Shehbaz Sharif, urged the government to announce the new auto policy at the earliest, warning that the delay threatens the survival of Pakistan’s automotive industry. The PAMA, while expressing serious concerns regarding the future and sustainable growth of Pakistan’s automotive industry, has requested that the new Auto Policy be announced at the earliest, with measures that support the long-term interests of the automotive sector and promote industrialization in Pakistan. The industry remains fully committed to supporting your efforts and stands ready to contribute toward the growth, development, and strengthening of Pakistan’s industrial base. Pakistan’s automotive industry holds the rare distinction of being among the largest CKD vehicle-producing bases in the world, with over 100 models manufactured locally. Over the last three automotive policy periods, the sector has attracted billions in investment, from OEM’s and parts manufacturers alike, generating billions of rupees in revenue for the national exchequer. This is a proven pillar of national industrial capacity, built through sustained investment and policy continuity. While the industry is not aware of the final contours of the forthcoming policy, the industry stakeholders urge that it should continue to prioritize and encourage local manufacturing and value addition rather than create incentives for the import of Completely Built Units (CBUs). Pakistan’s automotive industry has already established substantial production capacity through significant long-term investments in manufacturing facilities, vendor development, technology, and human resources. In this context, any policy measure that makes the import of CBUs more commercially attractive than local manufacturing could adversely affect capacity utilization, localization, employment, investment, and the broader industrialization objectives of the country. Under reduced and subsidize tariff, the liberalized used car import will further hamper domestic manufacturing and value-addition activity and will shut down local vehicle and parts manufacturing affecting thousands of factories and millions of jobs. The industry requested that the policy framework be structured in a manner that safeguards and promotes domestic manufacturing, particularly where adequate local production capacity already exists. The government’s objective of enhancing exports is highly commendable and fully supported by the industry. However, sustainable export growth requires a competitive and enabling environment, including reasonable input and energy costs, efficient infrastructure, and improved access to international markets through favourable trade arrangements. We respectfully submit that additional fiscal burdens on the domestic industry, particularly alongside measures that may encourage imports, could affect its competitiveness. A balanced policy framework that strengthens local manufacturing and export capability would better support the government’s long-term industrial and export objectives. Given the gravity and urgency of this matter, we respectfully request an audience with you at the earliest opportunity to place before you the complete facts underlying our concerns and to explore, together, a policy path that safeguards this critical industry. The industry expressing hopes for the continued governments support has reiterated the commitment of continuing serving the country as it has served in the past. Copyright Business Recorder, 2026

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