The Manufacturers of Two/ Three Wheelers have urged the government to restore R&D on Motorcycles export and provide $200 on export of Auto CNG Rickshaw. It was pointed out in a representation to Aitazaz A Niazi, Chief Executive Officer, Engineering Development Board during his visit to Karachi Chamber of Commerce & Industry at the end of last month.
The manufacturers said upon withdrawal of facility by R&D by government, export of Motorcycles were 80% gone done. “Demand of Auto CNG Rickshaw is quite good but we are unable to compete in price,” they added.
The Manufacturers also complained that PAMA was not giving membership to Major Pakistani Brand OEMs. They said PAMA (Pakistan Automotive Manufacturers Association) which is claiming to be the representative body of Two/ Three Wheelers Assemblers are not giving membership to Super Power Brands, Super Star Brands OEMs. Their applications were pending with PAMA for more than one year. The reason behind this negligence was one of the major Japanese Brand Assembler who was already a member of PAMA and stopping it as his position in Two/Three Wheelers Sub Committee must be dominated.
The EDB CEO was urged to intervene in this matter and get all pending applications processed at PAMA. He was appreciated to look into the concerned matters and being EDB as facilitator to resolve their issues.
It has been noted with great concern that In House Facilities Policy of Two and Three Wheelers was recently decided without taking input from Major OEMS of Pakistani Brands. There was no consultation with Major OEMs of Pakistani Brands on AIDP of Two/ Three Wheelers and recent Budget exercise. “We hereby request you to kindly include Pakistani Brand Assemblers in consultation which is presently more than 65% of stakeholders,” the representation said.
The OEMs of Two and Three Wheelers drawing attention of EDB Chief towards problems faced by the industry stated that recent Valuation Advice issued by Custom Authorities for Motorcycle Components in which more than twenty two items were valued at excessive prices were only for OEMs, while Commercial Importers are excluded from this Valuation Advice.
Upon excluding the Commercial Importers from this Valuation Advice it will force OEMs to purchase these components from Commercial Importers and thus promoting import of these parts through Commercial Imports. It was very strange; hence he was requested to review this advice with regard to excessive values put in it. They urged that commercial importers should also be included in it to provide level playing field to those OEMs who believe in imports under quota regime.
They observed that some of the OEMS were involved in Sales Tax evasion as a consequence they are giving tough competition in prices below the cost by not paying the Sales Tax on Motorcycles. This will badly affect the OEMS which are regularly and properly paying sales tax.
To sort out this issue they suggested that Centralized and Computerized Data Base at EDB should be created. Data from all Provincial Registration Offices should be obtained on monthly basis and input in the Centralized Data Base. On the other side data of sales with Engine and Chassis Number duly reconciled with Monthly Sales Tax Return is to be obtained from OEMs and input in the Centralized Data Base. Both data should be matched through software which helps in stopping the evasion of Sales Tax.
Regarding Delay in enhancing the quota it was said that annual quotas for imports to OEMs are given on the basis of last year production performance. It is well known fact that demand of Motorcycles is increasing day by day therefore OEM has to go again and again for enhancement of quota. It takes lot of time and lot of documentation involved in it which results in delay in allotting the quota; consequently OEM suffers with demurrages.
Hence, it has been requested to allot annual quota on the basis of assessed capacity of OEMs as determined by EDB. It will facilitate the OEMs to concentrate on production and at the end of year OEM is liable to give accountability of imports made.
-Nasir Mahmood
