Smuggled tyres to the tune of Rs300 billion enter Pakistan every year that deal a massive blow of Rs50 billion to the national exchequer and dampen investment in the sector, said an official of Ghandhara Tyre and Rubber Company Limited (GTR).

Speaking to journalists, he said the demand of tyres in Pakistan was close to 14 million units (excluding motorcycle and rickshaw tyres).

“Nearly 15% of the total domestic demand is met through local production while imports cover 25%,” he said. “The remaining 60% is filled by smuggled tyres.”

He was of the view that by curbing the smuggling of tyres, the government could encourage at least five more players to enter the segment by pouring fresh capital and motivate existing players to enhance the size of investment.

“Reducing inflow of contraband merchandise will also save precious foreign exchange for the country and contribute to the economy in form of employment generation and widening of the tax net,” the official said.

He cited that smuggling prevailed in the sector on the back of lack of coordination between the government authorities.

According to him, smuggling was rife due to misuse of Afghan Transit Trade (ATT).

“The government should re-visit the data of items being imported via the ATT and check whether the numbers are supported by the vehicle population in Afghanistan,” the official said.

He stressed the need to address the issue and urged Pakistan Customs to ensure that ATT is not misused.