Automotive sector for strategic approach to Pak-India trade

Our Staff Reporter KARACHI - Automotive sector urges government to ensure their participation in the Indian-Pakistan trade talks for achieving positive results towards enhanced commerce amid maximum protection to the local industries. Cautious approach and strategic planning is needed to safeguard the engineering base of the country, Arshad Awan CEO General Engineering said on Monday. He said that the involvement of private sector in policy making should be enhanced properly that guarantees prosperity of the two neighbouring countries through bilateral trade ties. Instead of it, the govt, at ministerial and secretarial levels, takes unilateral actions which lead to loss-making deals causing the destruction of its own industries. The delegations mostly formed by the bureaucracy, consists of traders and not industrialists which usually results in directionless talks without safeguarding local industrys interest. He said that free market economy is a rhetoric which has not been implemented by India even after giving MFN status to Pakistan in 1995. The non-tariff barriers are a blatant rejection of the same so strategically implemented by India that even Pakistan Government and its functionaries are unable to understand the viewpoint of industry and are vehemently pursuing to announce MFN status for India just to appease the Western countries which only want to invest in India and use Pakistan as a market only. Asian countries like China and Japan, on the other hand, would like to invest in Pakistan as long as there is consistency in policy and not the dominating view of traders in every matter. Presently, private sector is invited to some of the policy making forums but their involvement is limited to a few photo sessions that are subsequently used to satisfy the international donor agencies, a leading automotive part maker observed. While almost all serious and important decisions affecting the business and industry are being taken by the politicians and the bureaucracy, he added. He said that the automobile industries of the two countries are rivals of each other particularly in the motorcycle sector, in exporting countries. Hence, India and Pakistan are not allowed to compete in the auto sector particularly through their bilateral trade. Pakistan is one of the few countries in the world that manufactures all types of vehicles with higher production capacities than the current domestic demand for the same. The country annually needs 192,000 cars, 16,000 trucks and buses, 700,000 tractors and 1.5 million motorcycles. Pakistans government should not allow imports of Indian brands because Indian government will not allow Pakistan-made vehicles owing to non-tariff barriers, another representative of the automotive sector said. Citing example, he said, the emission standards Bharat 1 and Bharat 2 etc. are so unique in their application that no Pakistani vehicle will qualify to be sold in the Indian market. The taxation measures although on face of it not Pakistan specific, hit our products particularly. Further, the testing requirements have such time frames and costs attached to them that place small exporters at a huge competitive disadvantage and practically bar their entry to the Indian market. The trade in automobile sector in general and in different sectors in particularly should be opened gradually with progressive pace keeping in mind that the two states strengthen the economies of two nations, an expert from automotive sector said. He explained that the trade should move both ways, Indian markets should be as available to Pakistani products as ours will be open to theirs. Let Pakistans auto sector have import opportunities of raw materials and tooling from India and let our vendor industry have opportunity to export castings and rubber parts to them. Then let us see how receptive the Indian market is to our overtures, said a leading figure of the vendor industry. He urged that Pakistan should study how India responds on ground and not just on paper. Trade agreements such as WTO and the bilateral agreements such as FTA and the SAFTA should be framed in professional way and great importance should be given to the national interest, its industries and economy.

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