FPCCI considers Automotive Development Policy encouraging but imperfect

The Federation of Pakistan Chambers of Commerce and Industry (FPCCI) has said that the recently announced Automotive Development Policy 2016-21 is encouraging but far from perfect.

“The policy unveiled after a delay of three years encourages new manufacturers to enter the market while promoting latest technologies but it seems difficult in the current scenario,” commented Abdul Rauf Alam, FPCCI president, in a statement on Tuesday.

He pointed out that Pakistan continued to use substandard petrol – RON 87 – for the past 20 years while the rest of the world, except for Somalia, had switched to RON 92, RON 94, etc, which were not only environment-friendly but also saved the cost of vehicle repair.

He said petrol consumption in Pakistan stood around 17,000 tons per day, of which almost 55% was consumed by the motorcyclists who deserved better-quality fuel suitable for the environment.

“Continued import of substandard fuel has pushed international suppliers away from the Pakistani market, leaving the government dependent on a few suppliers with no competition,” he noted.

The FPCCI president suggested that the oil industry should invest in upgrading technology, enhancing the storage capacity and importing quality fuel to save cost for the people and industry, which was already facing losses due to the growing share of substandard lubricants.

He asked the government to advance soft loans to oil refineries that had been unable to bear the cost of processing quality fuel while rejecting the proposal for allowing marketing of different qualities of petrol as it would lead to adulteration.

“Reduction in the share of substandard lubricants and introduction of quality fuel will result in renewed interest of foreign investors in the Pakistani market,” he said, while pointing out that some companies were making cars and motorcycles according to the Euro fuel specifications while many businessmen were importing latest cars but consumers were forced to buy low-quality petrol.

He said though quality fuel was a bit costly, the plunge in international oil prices had made it viable for the common people without which quality of locally manufactured cars may remain questionable.