ISLAMABAD: Local manufacturers have started feeling heat of the influx of smuggled and under-invoiced tyres as market of such tyres has reached such a scale that could severely hurt the local industry.
As per details, under the prevailing scenario local manufacturers are feeling insecure in the face of heavy imports of under-invoiced tyres, which are hindering the growth of local business. The manufacturers believe that no quality check is applied to the imported tyres, majority of which are substandard and can pose a threat to vehicles and passengers while driving at high velocity.
The under-invoicing of tyre imports has been depriving the government of huge revenue being estimated at minimum of Rs5 billion annually.
The country’s rubber industry has capacity for huge investment but under the circumstances, investors are hesitant to inject capital. An investment of around $300 to $400 million is needed to set up a complete unit, which could generate about 25,000 direct and indirect jobs besides giving generating millions of rupees in revenue for the government.
Cars, trucks, buses and light commercial vehicles running on roads in the country need 8.2 million radial tyres every year. According to statistics, Pakistan imports four million tyres while 1.6 million are sold by local manufacturers. The remaining 2.6 million are smuggled into the country.
According to the manufacturer, the locally produced tyres are in line with the best standards and cannot cause harm to vehicles and passengers while travelling.
According to the manufacturer, around 200 to 225 trucks carrying smuggled goods including tyres cross into Pakistan from Afghanistan every day through Chaman border. Each of these trucks usually carries goods worth Rs10 to 15 million.
To cope with under-invoicing, the local manufacturers have suggested a minimum increase of 50 percent in the import value of Chinese manufactured tyres and 40 percent in the value of tyres coming from other countries.
