PAAPAM opposes import of used tractorsOctober 18, 2015
Karachi: Chairman Pakistan Association of Automotive Parts and Accessories Manufacturers (Paapam) Mumshad Ali has said the import of used tractors would damage the local industry and a huge employment base would experience a severe blow.
‘After having suffered losses in the import of used cars already, the government should not step into the similar venture again as it would create big issues for the tractor industry and farmers alike,’ he added.
Chairman Paapam added that the local tractors industry, which is heavily underutilized at the moment, is already producing best quality tractors as per global standards that are also cheapest in the world, therefore, allowing imports would put a further dent on the exchequer.
He said the foreign players in the industry never sustained, as witnessed in the past. ‘Even Chinese tractors failed to capture local market because our tractors are best with cheapest prices. The government should learn from past experience and refrain from repeating the same mistake again,’ suggested Chairman Paapam.
Mumshad added the government should not disturb this established tractor industry through this kind of policies. ‘Tractor industry is almost independent of import as it has achieved over 95% localization and this all is to get disturbed by the import of used tractors,’ added Mumshad.
Chairman Paapam said the import of used tractors would also hurt farmers because there would be no assurance of their quality once sold to them. ‘The big question is who would assure the buyers of the quality of the imported used tractors,’ he asked.
The farmers, he added, would not be able to get the parts of these used imported tractors while availability of trained mechanics for repairing the same would also be an issue. ‘The local tractor manufacturers have permanent local presence and a huge network of workshops providing guarantees to farmers,’ added Mumshad.
Besides a big blow to the vendors industry, he added, the imported used tractors would also disturb the allied industries of tractor manufacturing. ‘The local tractor manufacturing consumes 0.1 million ton of steel which is approximately 10% of the total annual production of Pakistan Steel Mills,’ he said.
So, he added, in case of imported used tractors the backward integrated benefit to allied industry would also get disturbed. ‘Our tractor industry has big export potential as we are producing the cheapest tractors in the world. Our tractor costs around $7000 while the same quality tractor manufactured by other countries of the world cost around $14000,’ said Mumshad.
The government should help the tractor industry in taking advantage of this edge, said Mumshad, adding that sadly there is no national policy, no mechanization plan, no scientific development, and no legitimate protection for the tractor industry.
‘World over countries provide rational and legitimate level playing field to their local industries but this is not the case with Pakistan. The government should safeguard and promote the local tractor industry and encourage it to boost exports which would not only generate huge foreign exchange but enormous employment opportunities in the tractor and allied industries also, helping the revival of economy,’ suggested Mumshad.