TRADE POLICY & AUTO POLICY
CONCERNS OF TRADE & INDUSTRY
July 30 - Aug 5, 2012
While the trade and industry is concerned about forthcoming trade policy, the auto makers were also perturbed due to possible change in the policy, hence the two sectors have strong demanded of the government to take them into confidence and discuss possible changes in the policy with the stake holders.
The automobile industry while showing serious concerns government policy to allow new entrants in the automobile industry without caring checks and balances to ensure THAT the industry is sailing smoothly while the rights and interests of the exiting auto players are well protected.
The industry has requested to the federal information minister to ensure consultation with the sector about new entrant policy before making any final recommendations for ECC.
The Federal Minister for Information is heading a sub committee constituted by the Economic Coordination Committee of the Federal Cabinet to evaluate the proposal by Ministry of Commerce to allow new investment with additional incentives over the existing tariffs and regulations.
Director General Pakistan Automotive Manufacturers Association (PAMA) Abdul Waheed Khan and Chairman Pakistan Association of Automotive Parts Accessories Manufacturers (PAAPAM) Syed Nabeel Hashmi have made this request in a letter to Federal Minister Ministry of Information & Broadcasting Qamar-uz- Zaman Kaira.
They said that unfortunately the voice of auto industry, which is the major stakeholder in this issue, has totally been ignored in government's policy of extending tariff concessions to new entrants.
'Both these organizations are the only officially recognized representatives of the OEMs and the vending industry working in the country. On the other hand, the sub-committee formed in this regard by the government has been gracious in allowing the opportunity to a particular foreign investor to make presentations to it and thus influence the decision making process in its favor,' they stated in the letter.
But a decision reached and policy developed without having an opportunity to listen to both sides of an argument cannot be balanced, they reasoned, adding that the motorcycle sector is the most vibrant sector of the industry. It has registered a growth of 37 percent on year-on-year basis over the last 10 years and no other sector has shown such consistent high growth.
But, they stated, policy interventions are being made in this sector just to appease interest of persons related to a single investor in total disregard of the interests and concerns of an industry which has billion of rupees of investment and is supporting direct employment for around 200,000 skilled and semiskilled jobs.
Motorcycle industry has a high multiplier effect due to its forward and backward linkages and is supporting around 1.5 million jobs in different sectors of the economy, so the way the policy is being developed for this sector is most unfortunate indeed, they stated in the letter.
They further said that 'the proposed policy shift will have serious ramifications for the vending industry of 800 odd players, as the technology transfer rolls back, investment decisions are suspended and will have long-term negative impact on investors confidence on governments policies for future investment.
TRADE & INDUSTRY
Meanwhile the trade and industry has called up the government for consultation with the stakeholders of the economy to have their recommendations incorporated in the Trade Policy 2012-13 to be announced next month.
S M Muneer prominent leader of the business community, Ehtesham Uddin Chairman Korangi Association of Trade and Industry, Vice Chairmen Hasham A Razzak and Tariq Malik President AKIA, Mian Zahid Hussain and former Chairman Syed Johar Ali Qandhari In a statement have advised the ministry of commerce to have consultations with the trade and industry before finalizing the Trade Policy which is being prepared for three years.
Trade and industry looking for preparation of a balanced and favorable trade policy envisaging more and more relief to the industry, provision of soft term-loans to the industry and reduction in mark up rate.
There need a focus on exploration of new markets abroad and release of research and development funds to the exporters.
A balanced and investor friendly trade policy is need of the hour so that Pakistani manufacturers could be able to compete with their competitors in the world market and enhance exports. They further said that government should also focus on Latin American and African markets where exporters face less competition and get better margin of profit. KATI Chairman Ehtesham Uddin has also invited Commerce Minister Amin Fahim and Secretary Commerce Muinr Qureshi to visit KATI to consult salient features of the forthcoming trade policy.