KARACHI: Pakistan Automotive Manufacturers Association (PAMA) has written to Prime Minister Shehbaz Sharif, seeking an urgent intervention to resolve a dispute among the commerce, revenue and industry departments of the government over the revised tariff structure introduced under the Finance Act 2026.
In its letter, PAMA said the new tariff structure has placed imported vehicles and commercially imported parts at duty rates lower than those applied to industrial Completely Knocked Down (CKD) kit imports, an anomaly it warned could cripple local vehicle manufacturing.
The association said the situation posed a serious threat to industrial stability, employment, investment, and the broader national economy. It noted that Pakistan’s automotive sector currently comprises 16 assemblers producing more than 100 vehicle models under 31 international brands.
PAMA said the industry has maintained an average annual production of around 250,000 units despite operating in a compressed market and facing repeated administrative measures under previous governments.
According to the letter, cumulative investment under successive automotive policies has exceeded USD5 billion, with the industry and its supply chain supporting livelihoods for nearly 2.5 million Pakistani families.
Following parliamentary approval of the Finance Act 2026, PAMA said the sector now faces an unprecedented crisis, as the reduction in Completely Built Unit (CBU) duty on vehicles below 850cc has significantly undermined the viability of local manufacturing in that segment.
The association warned that the anomaly threatens to reverse decades of industrial progress by making local production of vehicles and parts commercially unviable, disrupting the vendor base, discouraging fresh investment, and putting millions of livelihoods at risk.
PAMA has asked the prime minister to intervene immediately to resolve the differences between the commerce, revenue and industry departments of the government, describing early correction of the tariff anomalies as essential to restoring industrial operations, protecting investor confidence and safeguarding the country’s manufacturing base.
Copyright Business Recorder, 2026
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