In the interest of stabilizing the economy, the government has decided to ban the import of luxury items including cars, Pakistan Muslim League Nawaz (PMLN) leader, Maryam Aurangzeb, told the media on Thursday.
She stated that Pakistan’s economy is in dire straits and that the government has formulated a plan to save it from collapsing. She demanded that people sacrifice their desires for luxurious items for the country to ride out these trying times.
She highlighted that the import ban will allow Pakistan to save up to $500 million in a month and $6 billion in a year. Maryam added that the import of luxury vehicles has contributed largely to the soaring imported bill, which has resulted in the local currency depreciation.
Analysts worry that Pakistan’s economy is currently on a collision course, which spells disaster for multiple industries.
According to a renowned economist, Dr. Akmal Hussain, Completely Built-Up (CBU) vehicle import alone during 2020-21 was $1.53 billion which amounts to an 80 percent increase in import expenditures on cars over the previous fiscal year.
The new government has also noted that the imports of Completely Knocked Down (CKD) kits of cars and mobile phones have also been added to the import bill. Hence, the ministry of finance has recommended a 100 percent increase in the regulatory duty (RD) on cars with over 1300cc engine displacement.
The government has also decided to limit CKD imports to address the issue. These prospects certainly spell trouble for the Pakistani car industry and buyers alike.