Suzuki Still Wants Greenfield Status for Investment in Pakistan: Report

According to a local English newspaper, Pak Suzuki Motor Company Limited is still struggling to get the Greenfield status against an estimated investment of $460 million.

The report stated that two senior diplomats of the Japanese embassy met with senior officials of Ministry of Industries and Production in Islamabad to seek help in achieving this goal but instead they were clearly told that M/s Suzuki’s investment does not fall under the prevalent auto policy.

Suzuki began its efforts to get Greenfield incentives during PML (N) government, indicating a proposed investment of $460 million if granted the status. However, the former government had designed the auto policy in a way that existing players would not get incentives of Greenfield offered to new players.

Under the existing policy, the company’s investment will fall in the category of Brownfield project – the existing ones – but it is seeking benefits of the Greenfield project.

The quality of Suzuki’s cars also came under question during the meeting. The company recently unveiled its new car Suzuki Alto replacing its decade-old model Suzuki Mehran. The company has started booking the new car for Rs 0.5 million without even announcing the final price, with expected delivery in June 2019.

All Pakistani senior officials and political leaders who visit Japan are being plausibly questioned as to why M/s Suzuki is not being given Greenfield status despite the fact that the company is making a huge investment in Pakistan, the sources said.

M/s Suzuki, in a letter to a senior government functionary, praised his role for his continuous support for the company’s investment proposal of $460 million.

“We have completed all the preparatory work to start the construction of our new plant. Funds have been arranged by our principal Suzuki Motor Corporation, Japan for direct investment and are ready to transfer. Now we are eagerly awaiting the approval of Greenfield incentives and benefits for the period of three years by the Government of Pakistan,” said Masafumi Harano MD & CEO of Suzuki.

The CEO also assured that the company and its vendors will continue progressive localization, assuring that there will be no rollback of localization after allowing the Greenfield incentives and benefits to Pak Suzuki.

Suzuki also intends to invite Prime Minister Imran Khan and other top officials on the occasion of stone laying ceremony of the new plant. The ceremony will also be attended by the worldwide auto sector business community.

Pak Suzuki Motor had tried to get tax exemptions under the Greenfield investment category from the PML-N administration which was declined.

The two other key players i.e. Indus Motors Company which manufacture Toyota and  Honda Atlas have invested billions of rupees on expansion without seeking Greenfield incentives.

  • Quality of car is not as per selling price
    Kindly improve the quality as per international standards

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