New entrants in the auto industry have protested against the government’s plan to benefit Pak Suzuki with the tax relief under the auto policy 2016-21.
The new auto manufacturers are furious over the government’s approach and raised the issue in a meeting at Ministry of Industries and Production, reports Tribune.
As per the local media report, new entrants are against the expected incentives for Pak Suzuki as it is against the business roles. They are in fear that it will not only spoil their investment plans but will also affect the competition in the market.
Earlier, Pak Suzuki delegate met the prime minister and laid out their proposal of a new auto plant and demanded greenfield status from the government. Our sources tell us that the adviser to PM on Commerce, Industries and Investment Abdul Razaq Dawood is playing an important role for Pak Suzuki and has convinced the cabinet to reshape the auto policy.
Note here that the total investment country is going to witness by these companies amounts to over Rs $3 billion whereas the new Suzuki investment is not more than $450 million. It is evident that the PTI government wants investments at any cost, however, they need to do some maths and should treat all international companies on merit.
The new auto policy devised by the previous government clearly dictates that tax relief will be offered to those companies who are venturing into Pakistan’s auto industry by installing a new plant or reviving an existing facility. Thus, Pak Suzuki is not eligible for any tax exemptions.
The Board of Investment devised this auto policy to bring new players in the market to ensure competition, improved vehicle quality, swift delivery and more options for Pakistanis.
Our auto industry is almost non-functional where three big players; Honda, Suzuki, and Toyota enjoy a complete monopoly. They provide customers with redundant auto technology in vehicles while ignoring safety standards compared to their offerings in the international market.