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Thursday, May 23, 2024

Aliya Malik Explains the features of new Auto Policy 2021-26

In the recent show, she revealed the slashing of duties in the less than 1000cc car section is applied to both local and imported cars. For the local vehicle, the additional customs duty(ACD)is now 0 percent. The Federal Excise Duty(FED) is now 0 percent as well. 

The entirety of the automobile industry of Pakistan is waiting for an official document or some sort of official correspondence on the new Automotive Industry Development and Exports Policy 2021-26.

This is especially concerning as the existing Auto Policy 2016-21 is set to expire on 30th June 2021, a day from today, and has created confusion with certain policies.

However, in all this cloudy environment, the Parliamentary Secretary for commerce, industries & production Aliya Hamza Malik has been a ray of light, as she has time and again shared some bits and pieces of some highlights in the upcoming policy.

A month ago, she spoke to 92 news saying, “that there is a huge difference between the upcoming and previous auto policy”.

She has again appeared on the same talk show on 92 news, giving updates on the new policy.

The very first thing she talked about was the slashing on taxes on cars with less than 1000cc engine power.

According to the latest budget proposed in the parliament, every locally assembled and produced car below and equal to 1000cc will be cheaper for the consumer beginning from 1st of July.

Read More: Here is another good news for the car buyers in Pakistan!

In the 1000cc category, we have locally assembled cars including the Suzuki Cultus, Suzuki Wagon R, KIA Picanto, and United Alpha. In the 600cc category, the cars subsidized include Suzuki Alto, United Bravo, Prince Pearl, Suzuki Bolan, and Suzuki Ravi.

In the recent show, she revealed the slashing of duties in the less than 1000cc car section is applied to both local and imported cars. For the local vehicle, the additional customs duty(ACD)is now 0 percent. The Federal Excise Duty(FED) is now 0 percent as well.

In the import sector, the additional sales tax fell from 3 percent to 0 percent, additionally the ACD, FED and the regulatory duty have been eliminated too. Along with this, the Sales Tax has gone down from 17 percent to 12 percent.

She said this a big relief to the common people of Pakistan, who want to own cars.

Regarding the question of car financing, she said that the people who will be buying their first car would be able to get small local or imported cars financed on rather cheaper and feasible terms from the banks.

She said, “the government is working with the State Bank of Pakistan to work on such a financing mechanism where the markup rate on loans would be lesser than already very feasible rates offered by the banks”.

She sad marginalized communities are the focus of the incumbent government. She said that PTI has introduced “Meri Gari” after the much welcomed “Mera Ghar” initiatives.

Upon the question that the importers are claiming that the government hasn’t done anything regarding the imported cars, Aliya Malik replied that these people want the government to make it cheaper to import used cars into Pakistan.

She said that people are already not allowed to import these used vehicles. The parliamentary secretary added that it is something the government doesn’t strongly support, and it discourages the reduction of duties on the import of used vehicles.

This is because the parts for such cars are not available in Pakistan, and there are no after-sale services for such vehicles in the country either, she claimed.

Furthermore, the government Ms. Malik said is focused on local production of vehicles and in that respect has brought in 17 new entrants in Pakistan. She added that this would create employment opportunities for people in Pakistan.

Answering the question on the quality assurance side, Ms. Aliya Malik said that the incumbent government is the first one to be implementing the UN’s WP29 regulations, and under the new policy, it would be mandatory for the auto manufacturers to follows these 17 regulations under the law.

This would increase the quality and safety of the cars being made in Pakistan, and incentivize car exports from Pakistan.

Ms. Malik said that the new auto policy would be so comprehensive that Pakistan’s auto industry won’t only produce cars for local use, but will also allow exports of cars. She said that a $1 billion investment has happened under the incumbent government.

Read More: Aliya Malik shares a snapshot of Pakistan’s upcoming Auto Policy 2021-26

This seems like a good development for Pakistan if the policy comes soon, and the stakeholders’ worries about uncertainty are put to rest.