Auto Industry Analysis in Pakistan

8638 Words Mar 15th, 2013 35 Pages
“THE ROLE OF AUTOMOBILE INDUSTRY IN THE ECONOMY OF PAKISTAN ITS GROWTH. ITS IMPACTS NEGATIVE AS WELL AS POSITIVE.” Syndicate # 3 Syndicate Adviser: Dr. Shagufta Zareen
Members:
Muhammad Naeem Arshad Abbasi Ghazala Nasir Romana Alam Naveed Akhtar Khurram Mangi Mahmood Alam

Directorate General of Training & Research, Federal Board of Revenue, Lahore

Outline:

 Introduction  Literature Review

 Evolution of Automobile Industry with special reference to Pakistan  Automobile Industry in Pakistan and comparison with the Indian counterpart  Automobile Industry and the Allied industries o Workshops o Spare parts markets  Impact on economy  Contribution to the GDP  Impacts o Positive impacts  Economic impacts  Social impacts o Negative
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The auto industry remains second largest tax payer in terms of its contribution to customs duty, sales tax and withholding tax. The export contribution however, is marginal and growing slowly, which otherwise has high potential to grow in the coming years. AIDP envisage to achieve a critical mass of production, double the contribution of auto industry to GDP from the existing 2.8%, by the year 2011-12 with high focus on investment, technology up gradation, increasing its exports to US$ 650 million, enhancement in jobs alongside the development of critical components to further increase the competitiveness of domestically produced vehicles. the group also come across financial information of the leading manufacturers which formed the basis of our opinion that the benefits of reduction in sales tax and the removing of Federal Excise Duty from the sector has not been shifted to end consumers which shows marginal economic benefits to the manufacturer of the automobiles only. The Board of Investment, Government of Pakistan quoted the newspaper Pakistan Observer that contrary to huge Indian automobile industry in spite of offering discounts and attractive sops, is suffering from depressed sales, the nationwide auto sales increased by 3.4 percent in

Pakistan. The sales of locally assembled passenger cars (PC) and light commercial vehicles (LCV) in the country increased by around 3.4% over the previous year to 146,497 units
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