LAHORE: Local tyre industry has appealed to the government to address smuggling and low Import Trade Price (ITP) values, which are two significant issues badly hurting the local tyre industry.
“To safeguard the local tyre industry, the government should focus on measures to curb smuggling. Strict measures include stringent enforcement by FBR to stop sale of undocumented tyres and tighten control at border check posts at Chaman, Torkham and Taftan,” said Hussain Kuli Khan, Chief Executive Officer, GTR.
According to him, reduction in duties will not diminish smuggling, which can be gauged by one example that a truck radial tyre 11.00 R20 (70% of share in truck bus radial tyres) has zero custom duty (on Chinese origin radial truck tyres) but it is still smuggled in from China in large numbers.
Khan said, “The importers claim that if duties are reduced, smuggling will go down, as imports will rise. Last year, the imported tyre numbers nearly halved but there was no shortage of tyre in the market. This shows that the local tyre industry is capable of meeting the market demand.”
Hussain Kuli Khan further said that in the motorcycle and agriculture tyres, there is no smuggling and all demand is catered through local production as GTR is supplying passenger radial tyres and light truck radial tyres including SUV variants in the market. “Soon another player will also start production of light radial commercial and passenger radial tyres.
A truck bus radial plant is also in operation in Pakistan. The government needs to safeguard the local tyre industry and give it a level playing field,” he said, adding: “The FBR can bridge tax deficits by maintaining duties on imported tyres and adjusting ITPS based on actual import prices, rather than lowering duty structures; the Local tyre industry acts as an import substitute, resulting in savings amounting to millions of dollars.”
“In last six years, GTR has made substantial investments of more than 4 billion in plant and equipment to meet the local requirements. As the sole local tyre company producing all categories, GTR is committed to provide “Made in Pakistan” international quality tyres,” said Hussain Kuli Khan.
Copyright Business Recorder, 2024
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