Pakistan Industry Opposes Import of Motorcycle Parts at Zero Duty

The local bike manufacturing industry has progressed through technology transfer and currently produces 95 per cent parts locally, giving employment and generating revenues through several hundreds of small and medium sized vendor units.

The representatives of local bike industry said that allowing new investors to import all motorcycle parts at zero duty would negate the previous policies and discourage all OEMs (original equipment manufacturers) to bypass vendors and produce parts locally.

They said that government logic is worrisome and against the interest of the country's industry and future of industrialization. The anti-industry lobby is none other than advisors employed directly in the Board of Investment to serve this interest. It is a shame to allow such blatant conflict of interest to be accommodated, they said.

Fahad Iqbal, CEO of HKF Engineering, a leading motorcycle producer, said that Pakistan needs foreign investment. However, the country should not be so desperate in attracting investment by catering to unit specific investment proposals so as to destroy its most vibrant sectors where existing domestic and foreign are already investing. Such a case is that of the motorcycle industry.

A sad reality is that the Board of Investment of the country has not been able to succeed in attracting foreign investment, he said. Some is due genuine reasons like local law and order but most due to ad-hoc initiatives taken forward which signal the opposite sentiments to those desired, he added. According to him, genuine foreign and domestic investors don't seek special incentives but seek long term consistency in policy. Even in sectors where Pakistan enjoys competitive advantage like textiles, information technology, leather and sports goods, light engineering and many others, BOI has failed to attract investment.

Motorcycle production in Pakistan has increased by leaps and bound in past 12 years. It has increased from mere 100,000 units at the start of the century to around 2 million this fiscal. No other industrial sector has shown such high and sustained growth during past one decade. In fact Pakistan has emerged as global leader in production of 70CC motorcycles, he said. He added that now even new 125CC bikes are also being exported.