Motorcycle manufacturing: delay in formulation of new entrant policy may deprive $150 million investment

Delay in formulation of new entrant policy for motorcycle manufacturing may deprive the country of $150 million foreign investment by M/s Yamaha. The Japanese concern Yamaha Company Limited has asked the government for import duty exemption for five years on establishing manufacturing facility in Pakistan. But the new entrant policy of automobile is not uniform as it only allows incentives to Tractors, Trucks, Buses manufacture but did not allow Motorcycles.
The matter of five years import duty exemption was brought by a three- member delegation of M/s Yamaha to Chairman Board of Investment (BOI) Saleem H. Mandviwalla on Tuesday. Executive Officer, M/s Yamaha, Sumioka Ryouichi informed in the meeting that the existing assemblers and manufacturers of vehicles have over the years developed many parts and components locally and the factor that auto industry is yet heavily import dependent for various materials and components. "With marginal exports, an import duty exemption of 5 years will support to increase the company's marginal profits to some extend till 2020", he said.
Talking to the media Chairman BOI said that M/s Yamaha would like to invest $150 million to establish their manufacturing facility of world renowned Motorcycle in National Industrial Park, Bin Qasim, Karachi by acquiring 50 acre of land. The motorcycle manufacturer will have EFI engine, automatic transmission, water cool & environment friendly exhaust system meeting European standard in this plant. The state of the art motorcycles will have less fuel consumption of Rs 10 per 30min drive, which covers the distance of 40-50km.
The company in its future plan has disclosed that it would not only meet the demand of Pakistani market but will also enable them to export their models to various commonwealth countries. During his visit to Japan on 21-23 February, 2011, President Asif Ali Zardari also held meeting with Yamaha officials and ensured that government has framed the rules and procedure for the foreign investors in the auto sector. BOI is working to frame a policy resting on production of high technology products with environment and consumer satisfying features.
Board of Investment being facilitator of investments in the country strongly feels that the New Entrant Policy of Automobile should focus on considerable interest of important international auto manufacturers in Pakistan market and to meet the local demand and supply gap of various sectors.
The delegation of Yamaha comprising of Sumioka Ryouichi, Executive Officer, ITO Yasushi General Manager and Highuchi Yakeshi Senior Manager. The priority areas of investment from Japan are power, automobile, banking & financing, manufacturing, infrastructure & petroleum products and oil & gas exploration.