Pakistan’s auto sector: growth comes at a high cost
Touted as backbone for economy, companies have added little value to their imports
KARACHI:
Last week when auto sales data was released, everyone jumped with joy. Why shouldn’t they? Sales figures for March 2021 increased 27% month-on-month, and since year-on-year comparison really isn’t fair due to the lockdown in 2020, everyone saw this as a delightful development for a sector that has various industries associated with its recovery.
Figures for the nine-month period – between July 2020 and March 2021 – were even better with sales amounting to near 135,000, a 36% increase year-on-year. Now this figure is worth celebrating even more because, in the strictest sense, it takes away the months of inactivity due to the pandemic, and gives a closer picture of how much the auto sector has recovered. It compares the nine months during the time when interest rates were higher, economic activity was lower, and inflation was kee
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Pakistan s dilemma is not just wealth creation
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How has Pakistan s beloved auto sector fared since the 2016 policy
Put consumer welfare to the fore, and the love affair will continue
KARACHI:
Very few will argue that Pakistan’s auto sector is the country’s most beloved and simultaneously hated industry. The love stems from an individual desire to own/upgrade one’s ride, while the hatred for it is rooted deep into decades of lack of choice, absence of safety features, expensive options, and what is perceived as outright exploitation of the Pakistani consumer.
A similar argument was made by the government in its Automotive Development Policy 2016-2021 where it stated – in a nutshell – that while important and crucial for economic growth, the aim should now be to attract investment and ensure consumer welfare. It took a jab at the Big Three, and criticised them for “having issues of safety and reliability features with surplus unutilised production capacities and lack of competition”. The government also recognised