Amid economic meltdown, Pakistan’s auto manufacturers expect 40 percent decline in sales

This photograph taken on August 2, 2013 shows Khalid Yousaf Pakistani, the owner of a factory that outfits cars a bomb and bulletproof, examining a vehicle in Karachi. (AFP/FILE)
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Updated 23 May 2022

Amid economic meltdown, Pakistan’s auto manufacturers expect 40 percent decline in sales

  • Toyota has invested $100 million to produce hybrid vehicles, says another $80 million are in pipeline
  • Manufacturers expect highest sale of 350,000 units in Pakistan’s history during the current fiscal year

MUZAFFARABAD: Pakistan’s auto manufacturers fear their sales will squeeze by about 40 percent in the next fiscal year after achieving the highest ever growth during the ongoing one, as the country finds itself in a major downward economic spiral which is hurting the auto sector.
Pakistan witnessed 18 percent decline in car sales, from 22,799 to 18,625 units, in April due to restrictions on car financing imposed by the central bank along with increased import duties to curtail current account deficit.
The sector posted 51 percent growth during the current fiscal year beginning in July 2021 by selling 191,237 units, the Pakistan Automotive Manufacturers Association’s (PAMA) data show.
“The current economic situation is hurting the auto industry to a large extent,” Ali Asghar Jamali, chief executive officer of the Indus Motor Company (IMC) told Arab News on Friday during an auto industry workshop held in Muzaffarabad, the capital city of Pakistan-administered Kashmir.
The IMC, which manufactures Toyota vehicles, arranged the workshop to highlight the localization level achieved by the auto industry while gauging the impact of auto policies on the sector.
“The automobile market will fall by 30-40 percent in the next fiscal year [FY22-23],” he said. “However, the market will be of around 350,000 units this year which will be the highest ever in the history of Pakistan due to the current orders placed.”




Ali Asghar Jamali, chief executive officer of Indus Motor Company, addresses an auto industry workshop in Muzaffarabad, Pakistan, on May 20, 2022. (AN Photo)

Jamali, who is also the former chairman of PAMA, said the total number of cars sold in the next year was likely to be between 200,000 and 215,000.
Pakistan has imposed a ban on the import of non-essential luxury goods, including vehicles, in a bid to stabilize the economy after its current account deficit spiraled out of control. The country’s foreign exchange reserves have also witnessed a decline while its national currency is trading at low levels against the US dollar.
Supporting the government’s decision to ban import of luxury goods, Jamali said Pakistan’s auto sector required consistent policies.
“The future of Pakistan’s auto sector is bright but at present the country is facing a crisis situation and we have to get out of it,” he said. “We have a major current account deficit due to a high import bill and in the current situation the country will have to take tough decisions. We need to device a sustainable policy to avoid crisis-like situation after every two years.”
Pakistan’s auto sector has witnessed an inclusion of two new entrants and made an investment of about $2 billon since 2016 while providing 2.5 million employment opportunities. The sector contributes 2.2 percent to the overall economy of the country.
“The new entrants have made substantial investment in the sector,” Jamali said. “We [the IMC] have already invested $100 million to make Hybrid Electric Vehicles (HEVs) in Pakistan and another $70-$80 million are in the pipeline.”
“We have invested Rs15-18 billion in plant expansion during the last five years to introduce new models in Pakistan,” he added. “Pakistan’s auto market is still very attractive and what we need is to fix our fundamentals and improve it.”
The IMC chief, who is planning to launch locally assembled hybrid vehicles in Pakistan from next year, said his company was gradually moving toward complete electric vehicles (EVs) with improvement in infrastructure development in the country.
“I agree that the ultimate future is electric vehicle but we think that first it would be hybrid and then it would move into the next stage that is completely electric because at present there is no infrastructure for EVs,” he said, adding: “In the next five to seven years, share of renewable energy in the overall energy mix will improve and the infrastructure for EVs will be available so our strategy is to first bring in hybrid and then move on to the EVs.”
Pakistani auto manufacturers have recently increased prices of the vehicles between seven to 55 percent due to the rise in freight charges by about 252-272 percent, foreign exchange by 24 percent, and 18 to 80 percent rise in the prices of other related goods, according to a presentation given during the workshop.
“The whole world has witnessed unprecedented inflationary pressures in the last couple of years and Pakistan is no exception,” Jamali said. “The pandemic resulted in the disruption of global supply chain which was further aggravated by the Russia-Ukraine conflict.”
“The rupee-dollar disparity, exponential increase in utilities, overwhelming freight charges and government taxation of up to 40 percent have contributed to Pakistan’s economic challenges,” he continued.
However, he warned that any bid to regulate the auto sector, including price fixation, would lead to exit of Toyota cars from the Pakistani market.
In Pakistan, 400 registered vendors have been supplying parts to the auto manufacturers whose number is expected to increase in coming years.
“Vending industry is playing key role in the localization of vehicles and they are investing in modernizing their product lines,” Syed Nabeel Hashmi, former chairman of Pakistan Association of Automotive Parts and Accessories Manufacturers, said while speaking at the workshop. “As a nation, we have to look at the future technology.”
Hashmi called for action against a huge influx of Chinese products which, he said, lacked requisite quality and damaged the automobile sector.
“We want long term policy in Pakistan so that we can manufacture high tech equipment for EVs that are the future of transportation,” he said.
 


PM proposes ‘national dialogue’ to reform Pakistan’s state of affairs 

Updated 8 sec ago

PM proposes ‘national dialogue’ to reform Pakistan’s state of affairs 

  • PM Shehbaz Sharif warns against ‘internal division’, calls for unity 
  • Starting point for national dialogue can be ‘charter of economy’— Sharif 

ISLAMABAD: Prime Minister Shehbaz Sharif on Sunday urged all stakeholders in the country to move toward a “national dialogue” to resolve Pakistan’s complex issues, on the occasion of Pakistan’s 76th Independence Day. 

Pakistan is celebrating 75 years of freedom from British rule in the subcontinent. On August 14, 1947, British India was divided into the two states of India and Pakistan. 

The political temperature in Pakistan is on the rise, with former prime minister Imran Khan levelling allegations against Prime Minister Shehbaz Sharif and the coalition government of being part of a US-backed conspiracy to oust him from power earlier this year. 

“We need to have a national dialogue so that the mistakes of the past can be clearly identified,” Sharif said during a flag hoisting ceremony in Islamabad. “We need to start a sincere struggle to reform [Pakistan’s] state of affairs,” Sharif said. 

He said that starting point for national dialogue can be the “charter of economy.” 

“If we [Pakistan] can become a nuclear power, why can’t we become an economic power,” he asked. 

In his written message earlier, the prime minister said Pakistan’s creation was an outcome of its founder Muhammad Ali Jinnah’s single-minded devotion, unflinching resolve and unwavering struggle. 

“Nothing is more dangerous for a nation than internal division; disruption and chaos, for such negative forces undermine the solidarity and integrity of the country and rob societies of their national purpose,” he stated. 

“We can push back the divisive and nihilistic forces with the power of the people and protect our freedom and identity. I have my full faith in their capabilities to chart a way forward,” Sharif stated. 


Saudi king, crown prince congratulate Pakistan on Independence Day 

Updated 14 August 2022

Saudi king, crown prince congratulate Pakistan on Independence Day 

  • Saudi leadership wishes “steady progress and prosperity” for Pakistanis 
  • Islamabad, Riyadh enjoy deep-rooted, cordial ties with one another 

ISLAMABAD: Saudi Arabia’s King Salman bin Abdulaziz and Crown Prince Mohammed bin Salman congratulated President Arif Alvi on Saturday on the occasion of Pakistan’s 76th Independence Day, the Saudi State News Agency (SPA) said. 
On August 14, 1947, British India was divided into two countries, India and Pakistan. Every year, Pakistanis celebrate their independence from British rule with fanfare and festivities throughout the day. 
Islamabad and Riyadh have always cherished close diplomatic relations and are collaborating in various sectors. 
In their messages, the Saudi leadership wished President Alvi health and happiness and hoped Pakistan’s masses enjoy steady progress and prosperity. 
“The Custodian of the Two Holy Mosques King Salman bin Abdulaziz Al Saud has sent a cable of congratulation to President Dr. Arif Alvi, President of the Islamic Republic of Pakistan, on the anniversary of his country’s Independence Day,” the SPA said. 
In his message, Crown Prince Mohammed bin Salman “wished the President constant good health and happiness and the government and friendly people of the Islamic Republic of Pakistan steady progress and prosperity.” 
Saudi Arabia is home to more than two million Pakistanis and has been the top source of workers’ remittances to the South Asian nation. 


Military says reports of TTP's large presence in northwestern Pakistan ‘grossly exaggerated’ 

Updated 14 August 2022

Military says reports of TTP's large presence in northwestern Pakistan ‘grossly exaggerated’ 

  • Militants will be dealt with full use of force if required, says Pakistan Army 
  • Thousands protested in Swat on Friday over reports of TTP militants’ presence in area 

ISLAMABAD: Pakistan’s military said on Saturday that reports of a large presence of Pakistani Taliban or the Tehreek-e-Taliban Pakistan (TTP) militants in Pakistan’s northwestern Swat Valley are “exaggerated and misleading.” 

Thousands protested in two main towns of Pakistan’s Swat valley in northwestern Khyber Pakhtunkhwa province on Friday. Protestors took to the streets to denounce violence after reports that said Pakistani militants had increased their presence in the area. 

The TTP have carried out some of the bloodiest attacks inside Pakistan since 2007, including a 2014 assault on a school in which 134 students were killed. The group is not directly affiliated with the Afghan Taliban, but pledges allegiance to them. 

Pakistan military’s media wing, the Inter-Services Public Relations (ISPR) said in a statement that a misperception about the alleged presence of a large number of TTP’s armed members has been created on social media over the past couple of days.  

“After confirmation on ground, these reports have been found as grossly exaggerated and misleading,” the ISPR said. “Presence of a small number of armed men on a few mountain tops between Swat and Dir has been observed, located far away from the population,” it added.  

The military said that these individuals “sneaked in” from Afghanistan to resettle in their native areas, adding that security forces are keeping a close watch on their limited presence and movement in mountains.  

“Required measures are in place by all LEAs (law enforcement agencies) for the safety and security of the people of the adjoining areas,” it said.  

“Presence of militants anywhere will not be tolerated and they will be dealt with full use of force if required.” 

Swat Valley used to be a TTP bastion in 2009 before a military operation by Pakistan’s army drove them out, causing thousands of families in the region to be displaced.  


Monsoon death toll climbs to 188 in flood-ravaged southwestern Pakistan

Updated 13 August 2022

Monsoon death toll climbs to 188 in flood-ravaged southwestern Pakistan

  • Provincial disaster management authority reports six new deaths over last 24 hours
  • 582 people have died in rain-related incidents across Pakistan since mid-June

QUETTA: The death toll from rain-related incidents since the onset of monsoon season has killed at least 188 in Balochistan, authorities said on Saturday, as rains continue to lash the southwestern Pakistani province, triggering flash floods.

Monsoon rains have wreaked havoc in Pakistan since mid-June, killing at least 582 people. Balochistan, Pakistan’s largest province by size and its most impoverished one, has reported the highest number of casualties.  

The Provincial Disaster Management Authority (PDMA) recorded six new deaths in rain-relates incidents in the past 24 hours.

“Six more bodies were recovered in the last 24 hours in Balochistan’s Killa Abdullah and Lasbela districts who were swept away in flash floods due to heavy rains on Friday,” Meer Zia Langove, advisor to the chief minister on disaster management, told reporters in the provincial capital, Quetta.

PDMA Balochistan director general Naseer Khan Nasir said four out of Friday’s six deaths were recorded in Killa Abdullah district, where the victims were trying to cross a flooded road.

Many roads are impassable, and traffic has been suspended also on the Quetta-Karachi highway due to the overflowing of the Lunda River in the Lasbela district.

“Our teams are fully engaged with the National Highway Authority (NHA) to clear the roads. It will be opened for traffic in the next 24 hours,” Langove said.

“Twenty-six out of 34 districts in Balochistan are badly affected by monsoon rains and floods which destroyed 40,000 homes and crops cultivated on 500,000 acres of agricultural land.”

Last month, Prime Minister Shehbaz Sharif visited the province’s worst hit areas, ordered immediate aid for their residents, and set up a relief fund for flood victims.

According to Pakistan’s Meteorological Department (PMD), the coming week may bring even more torrential rains to the region.

“Flash floods are expected in Killa Saifullah, Loralai, Barkhan, Kohlu, Mosa Khel, Sherani, Sibbi, Bolan, Kalat Khuzdar Awaran, Turbat Panjgur and other cities of Balochistan,” the PMD said in a notification on Saturday.

Downpours are also forecast for the provinces of Punjab and Sindh province.


Pakistan to expand COVID-19 vaccination to children next month as cases rise

Updated 13 August 2022

Pakistan to expand COVID-19 vaccination to children next month as cases rise

  • Government expects to receive vaccines and special syringes by next week
  • Pakistan Medical Association says vaccine for children is safe and effective

ISLAMABAD: The Pakistani government said on Saturday it will start vaccinating children aged five to eleven against COVID-19 from mid-September as infection figures are again on the rise.

After reporting a significant decline in COVID-19 cases earlier this year, Pakistan did away with almost all coronavirus restrictions. It has been witnessing a spike in infections since June, although health authorities say the situation largely remains under control and has fully vaccinated against COVID-19 over 88 percent of the population aged above 12 years.

“We will be starting COVID-19 vaccination of children aged between five to eleven years by mid-September,” Muazzam Abbas Ranjha, a vaccination lead at the National Institute of Health (NIH) in Islamabad told Arab News.

“The process for procurement of the vaccine and special syringes for the purpose is underway, and we’ll be receiving them next week.”

Ranjha said that Pakistan has done “extremely well” in immunizing its population against the pandemic and that’s why the numbers of deaths and infections have remained low compared to the neighboring countries.

“Now it’s time to immunize our children against the disease to curb the virus spread,” he said. “It is vital to administer the vaccine to our children as well to immunize the whole population against the virus.”

The country has conducted 20,272 COVID-19 tests in the last 24 hours, out of which 728 turned out to be positive or 3.59 percent with three deaths. A total of 161 patients are in critical condition, the official data says.

Ranjha said the number of daily infections in the country was under control as the government was constantly monitoring the situation.

“There is nothing alarming so far, but the people should still keep following health guidelines like mask wearing and social distancing at public places to evade the infection,” he said.

Dr. Qaiser Sajjad, secretary general of the Pakistan Medical Association, told Arab News the vaccination of children would help boost general immunity.

“The scientific data available shows the vaccine for children is safe and effective,” he said, adding that the government should roll out an awareness before starting the drive.

“Developed countries have already started vaccination of the children to curb the virus, and it is highly recommended that we should also start it as quickly as possible.”