Pakistan Association of Auto Parts & Accessories Manufacturers chairman Siddique Misri has demanded immediate withdrawal of regulatory duty on raw materials imported for auto parts manufacturing.

He stated that regulatory duty has been wrongfully imposed on import of raw materials (CRC/HRC/pipes/tubes) being imported by the auto parts manufacturers (APMs), although none of these “auto grade” raw materials are manufactured locally. This duty has been imposed through amendments made in SRO 568, vide SROs 18 & 246 dated January 14 & March 27, 2015 respectively. Misri explained that all APM imports are fully verified by EDB under SRO 655 and monitored by the WEBOC System, to the effect that these raw materials are not manufactured locally. Levy of RD is, therefore, causing irreparable damage to the small and medium sized APMs, who are now on the verge of closure.

Mumshad Ali, Sr. Vice Chairman, emphasized on immediate withdrawal of RD on all raw materials, which are imported only by manufacturers of auto parts who are registered under SRO 655(I)/2006, and strictly follow all the rules laid down under the government’s approved Auto Policy of the country, to avoid closure of APM plants and large scale loss of jobs in the country. PAAPAM chairman demanded that, similar to the exemptions granted to manufacturers of CRC & other products (who are approved under SRO 565), exemption should also be granted to APMs.

 (who are similarly approved under SRO 655), through immediate addition of following exemption clause 2(j) in SRO 568 dated 26th June, 2006: “j) imports under SRO 655 dated 22nd June 2006”.

At a meeting of the managing committee of PAAPAM held in this regard, the members protested vehemently on this arbitrary levy of Regulatory Duty by the FBR, who have taken this unilateral action, without understanding the ramifications of this measure on an industry which is providing direct and indirect employment to over 3 million skilled workers. Based on average family size of 5 persons, this industry is providing sustenance to 15 million persons (or over 8% of the country’s population).

 Finally, the members appealed to the Prime Minister and the Finance Minister to intervene in the matter and direct FBR to immediately withdraw levy of Regulatory Duty on raw materials imported by auto parts manufacturers.