President Pakistan Businessmen and Intellectuals Forum (PBIF), President All Karachi Industrial Alliance (AKIA), Senior Vice Chairman of the Businessmen Panel of FPCCI and former provincial minister, Mian Zahid Hussain on Wednesday said that Pakistan is 6th most populated country after China, India, US, Indonesia and Brazil with population of 197 million. 54 percent of our population is aged below 30 years shows 100 million young potential consumers of the auto industry.
In this decade, the annual motorcycle production has increased to 2 million from 50 thousand just because of the growing young population. In Brazil, 260 people own vehicle out of 1000, the count is 80 in Indonesia while it’s just 15 in Pakistan, which shows the huge potential market for auto sector. Given to urbanization and improved living standard, increasing vehicle’s sale is expected in coming days.
The Veteran Business Leader while talking to the business community said that investment in automobile sector is not only profitable but also easy which can benefit the local and foreign investors equally. There is no barrier to enter the business and comparatively a safes sector for investment. New investors will have the edge of filling the huge demand supply gap. There is demand of 1 million vehicles per annum while local companies produce only 2.5 lacs vehicles while 70 thousand vehicles are being imported annually. Approximately 7 lacs used cars are being traded annually which indeed is a rich opportunity to be grabbed by the new investors.
The Former Minister said that the auto sector has shown high growth during the decade 2008 – 2018 where 97 percent growth has been observed in the production of motorcars and pickups, 92 percent growth in production of buses, 99 percent growth in Jeep’s production and tractors’ production have been increased by 92 percent. The Japanese investors can fill the 50 percent gap in manufacturing of auto-spare parts. In the backdrop of expected growth in the auto sector new companies including French Renault in collaboration of Alfutaim, etc are planning to start assembling in Pakistan in addition to the existing auto manufacturers which are expanding their product range. Agriculture reforms in the Country suggests increasing demand for tractors while demand for Trucks, Buses, Motorcars and Motorcycles is also increasing due to ongoing CPEC projects.
Mian Zahid Hussain said that with implementation of Automotive Development Policy in its true spirit, the auto sector contribution to GDP will be increased from 2.3 percent to 3.8 percent; share of auto sector in industrial production will rise from 22 to on30 percent while this sector will employ 4 million masses in the Country. The existing potential in this sector may be opportunity for the small medium enterprises and local as well as foreign investors.
Mian Zahid Hussain said that to improve automobile sector, the astonishing regulatory duties on import of raw material and auto parts may be rationalised and the recommendations of registered trade associations including PASPIDA, PAAPAM and PAMA may be given due consideration.