The government has decided to streamline the
Engineering Development Board (EDB) and Pakistan Industrial
Development Corporation (PIDC), the two significant organizations with
a view to assign greater role to the engineering sector as the engine
of knowledge-based growth to make Pakistan an engineering hub of the
Federal Minister for Production, Industries and
Special Initiatives, Jahangir Khan Tareen speaking at the inauguration
of Pak Suzuki production expansion facilities, last week, disclosed
that one billion dollar export of engineering products is our target
In view of the available potential, the target was
well within reach of the engineering sector.
Jahangir also observed that more than Rs10 billion
have been collected on account of Workers Participation Fund but
unfortunately this fund was not being utilized in the past. Sincere
initiatives have been taken now to utilize this fund for the welfare
of workers, which ultimately reflect in the growth of the engineering
and the manufacturing sectors, said the minister.
Actually the most significant growth in the
automobile sector, which is usually described as the mother industry,
was reflected in the huge investment for expansion, replacement and
modernization of almost all the automobile manufacturing units to cope
with rapid growth of vehicles demand in Pakistan.
Expansion for production facilities at Pak Suzuki
is a quantum leap from 50,000 to 80,000 units per annum. It would
substantially contribute to the growth of the automobile industry in
This phenomenal increase in production capacity
would bring relief to the genuine customers who would be able to get
delivery of most popular brands of Suzuki vehicles at factory price in
much reduced waiting time.
The minister said that he, as guardian of the
industry, strongly advocates that the government should maintain
policies conducive to the survival and growth of both automobile
manufacturing and the SMEs servicing as vendors to the principal
manufacturing units and added that the consistent and bold economic
steps of the government have started yielding results in the form of
growth in this vital sector of the economy, which can be seen today
reciprocated by the confidence foreign investors are showing in the
form of huge investment in this sector.
The auto industry in Pakistan has entered the era
of maturity and with the passage of time in the wake of increasing
growth rate of GDP it would further contribute to industrialization
and modernization of the engineering side of the economy. The industry
is not only one of the largest employers directly but also creates
jobs both upstream and downstream for dealers, service workshops and
after sale market.
The minister said, the availability of auto
financing at competitive and reasonable rates offered by the leasing
and financial sector is a new vista of employment. He said that Rs22
billion were given for auto leasing by banks and other leasing
companies in 2003 but the amount jumped to Rs50 billion in 2004. He
said that threat posed by WTO elimination of TRIMS is to be taken as
challenge by a population of more than 150 million people. An average
6.5 percent GDP growth and a gap in the average per capita ownership
of vehicles with the world average are to be exploited to the
advantage of the country.
Pak Suzuki Motor Company has emerged as number one
in the world in terms of producing vehicles with CNG kits. The
deletion levels of the components achieved by Pak Suzuki can also be
described as the benchmark for the industry to follow.
Jahangir Tareen was of the view that the government
sees the automobile industry as a nursery for nurturing SMEs required
to support the poverty alleviation plan of the government and the
government even ready to provide necessary support wherever possible
within international commitments.
Speaking on the occasion, Managing Director Pak
Suzuki, Kenichi Ayukawa observed that in early 2004, the company had
embarked on setting up a most modern integrated plastic parts
injection molding shop with a conveyorized plastic parts paint line.
The project went into commercial operation in May 2004 and this was
soon followed by expansion of Press Shop through addition of another
integrated Tandem press line of five high capacity Mechanical Presses,
expansion of body painting line by addition for electro deposition
tank and paint booth and BMR of vehicles final assembly line, welding
facilities and vehicles testing facilities.
In response to the call of the government to take
concrete measures to curb the menace of premiums and long waiting
periods on delivery of Suzuki vehicles, Pak Suzuki is now geared up to
meet the current demand. The investment made in expansion facilities
amounts to Rs2.98 billion. Further investment of one billion rupees is
in the pipeline for product upgradation. The expansion will create
more than 1,400 additional jobs in two years of which about 575 will
alone be at Pak Suzuki.
In fact the emerging automobile sector can ignite a
real spark to the growing economy of Pakistan if it was driven in the
right direction with the sincerity of the purpose to bring an
engineering revolution not only to meet the local demand but exporting
vehicles to the available untapped market in Central Asia, Bangladesh
and African region. This purpose can only be achieved when our auto
sector starts production of vehicles at a massive scale to operate on
the economy of the scale.