ISLAMABAD - A parliamentary committee on Monday has taken notice of the government's policy of importing used cars that created confusion in the market, as thousands of cars are still stuck at the ports awaiting clearance.

The Senate Standing Committee on Finance and Revenue has summoned the officials of Ministry of Finance, Ministry of Commerce and Federal Board of Revenue to give their viewpoint on the government's policy of importing used cars in next meeting.

The federal government had recently reverted the new policy regarding import of three-year-old used cars with previous policy on the demand of importers.

"The government has adopted unclear policy regarding importing used cars, which resulted in increase in prices of local manufactured cars. Moreover, more than 9000 imported cars are being held at different ports," said the committee chairman Senator Saleem Mandviwalla.

He further said that businessmen as well as common people are suffering due to the unclear policy regarding importing used cars. He said that Ministry of Commerce and Federal Board of Revenue are not giving clear stance regarding government's policy of importing used cars.

He blamed the government for creating uncertainty in the market, which is hurting the consumers.

The government in last four months had twice revised the policy of importing used cars. In October 2017, the government had adopted a new mechanism under which if vehicles are imported "under personal baggage, transfer of residence or gift scheme the remittance for payment of duties and taxes should originate from the (bank) account of Pakistan's national sending the vehicle from abroad.

The commerce ministry said all duties and taxes on imported vehicles in new or used conditions, either under personal baggage or gift scheme, would be paid out of foreign exchange arranged by Pakistani nationals or local recipient supported by bank encashment certificate showing conversion of local currency.

The objective was to curb the misuse of schemes envisaged for overseas Pakistanis and rationalise car imports.

However, the auto industry said the decision would hurt car traders and affect the economy as a whole. The decision has created some problems for those importers who had already shipped their vehicles and now are stuck at the ports.

Later, the ECC in early February decided to revert to the mechanism in practice. The ECC has approved the previous procedure applicable before October 2017. Used cars will be released like in the past.

The ECC also directed the Commerce Division to deliberate on the issue in consultation with all stakeholders and submit a summary with viable recommendations to the ECC for consideration.