KARACHI: Pakistan’s import of completely built unit (CBU) cars dropped by 81% during the first nine months of fiscal year 2022/2023 due to government restrictions aimed at supporting the country’s balance of payments.
Data released by the Pakistan Bureau of Statistics (PBS) on April 18, 2023, revealed that CBU car imports plunged to $47.31 million during the first nine months of the current fiscal year compared to $244.56 million in the same period of the last fiscal year.
The federal government had imposed a ban on the import of luxury and non-essential items on May 19, 2022. The ban was lifted on August 20, 2022, following a demand from the International Monetary Fund (IMF). However, car imports remained negligible, recording a 95% decline in September 2022 compared to the same month of the previous year.
During July to March of the current fiscal year, the overall import payment of CBU vehicles declined by 71% to $139 million compared to $480 million in the same period of the previous fiscal year. The import of CBU buses, trucks, and other heavy vehicles also recorded a decline of 52% to $1.35 billion during the period under review compared to $2.82 billion in the same quarter of the last fiscal year.
Meanwhile, the import payment for Completely Knocked Down (CKD) cars fell by 48% to $361.35 million during the first nine months of the fiscal year 2022-2023. CKD units are the basic raw material for the local assembly of cars.
As a result of the restrictions imposed by the State Bank of Pakistan (SBP) on the import of CKD kits, car manufacturers in Pakistan have observed temporary halts in production. Many other car makers have also announced temporary shutdowns due to insufficient inventory. The restrictions on CKD unit imports have also impacted the domestic sales of locally manufactured cars.
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