LAHORE - The auto industry representatives have welcomed the ECC decision to bring down age limit of used imported cars from five to three years to support the local industry, but importers have rejected the move.

Manufacturers said that this decision would go a long way in stimulating the growth of the domestic industry and a flagging economy. Deputy Prime Minister Pervaiz Elahi, deserves appreciation for accepting the auto industry’s plea and moving a proposal for reduction in the age limit of used car imports, said PAAPAM Chairman Munir Bana.

He said that senior minister firmly believed that jobs of 2 million workers of the auto industry must be saved. At Paapam’s last annual function, he personally made a commitment to raise his voice against imports of used cars in the interest of domestic industry.

Appreciating Pervaiz Elahi’s services, vice chairman Usman Malik said that the deputy prime minister had also reduced general sales tax on tractors from 17 per cent to 5 per cent last year, helping revive the tractor industry and its allied auto parts manufacturing (APM) units.

Syed Nabeel Hashmi thanked the deputy prime minister and also called upon the industry as a whole to respond to the govt gesture immediately by further enhancing and speeding up production and local content.

He said that the auto industry was facing a steep decline in production and car assemblers and APMs had retrenched thousands of workers because of continuing imports of used cars. He said that countries like India, Thailand, Malaysia and even Japan protect their local industry by imposing heavy duties to discourage imports.

Usman Malik added that in order to protect the employment of 2 million persons directly/ indirectly associated with the automotive industry and to encourage foreign investment, it was essential to provide fair protection to local industry.

PAMA chairman Parvez Ghias said that local industry welcomes decision as it was critical for survival of industry. He said that during the period 2001-2007, with the help of stable policies of the government, the automobile industry went through a period of tremendous expansion, with investments of over Rs40 billion and volumes going up by over 500 per cent. Unfortunately, due to import of used vehicles and other adverse policy factors, our industry is now suffering from excess capacity, he added.

All-Pakistan Motor Dealers Association Chairman HM Shehzad terms it monopoly of car assemblers, as reduction in the age limit of used cars, coupled with an increase in prices and black-marketing, will make them more strong. He said that the government would lose over Rs30 billion in terms of revenue from used car imports.