To rationalise the prices of locally manufactured cars, the Ministry of Industries and Production (MoIP) has finally relaxed the conditions for new entrants under the Auto Industry Development Program (ADIP). The MoIP has issued notification on Thursday, which reduces the annual production benchmark from 500,000 units to 100,000 units per annum for new entrants. MoIP notification stated, “The federal government is pleased to direct that in the Auto Industry Development Program (AIDP), the eligibility criteria at page no 59 of the report under para 9.2 (i) in Chapter 9 relating to Auto Industry Investment Policy, the figure 500,000 has been changed to 100,000 and para 9.2 (i) will now be read as follows: In case of cars the potential new entrant will have 100,000 units annual production in countries other than Pakistan.” Notification indicates that the MoIP has made this amendment in compliance with the Economic Coordination Committee (ECC) decision to rationalise the prices of locally manufactured cars. Speaking to Pakistan Today, Pakistan Association of Automotive Parts Accessories Manufacturers (PAAPAM) Chairman Syed Nabeel Hashmi underscored that it was a welcoming move and PAAPAM always encouraged new entrants. New players would bring competition in the industry, which would ultimately increase growth and employment opportunities. However, before allowing any new entrant in the local market, the government should thoroughly scrutinise their credentials to bar the entries of briefcase assemblers, he maintained. Responding to a question, he said that in the AIDP, the condition of 500,000 units per annum capacity was included to encourage the automobiles exports from Pakistan.
