Pakistan Economy - News & Updates - Archive

[Neo]

IDB assures full support for reconstruction, rehabilitation process

Monday August 28, 2006

JEDDAH: The Chairman of the Islamic Development Bank Dr Ahmad Ali has assured Prime Minister of Azad Jammu and Kashmir Sardar Attiq Ahmad khan that his bank would play a role in human resources development in reconstruction program of AJK government.


This assurance was given by the Bank chief when the Prime Minister visited the headquarters of the Bank here on Monday morning before leaving for Pakistan. Veteran Kashmiri leader Sardar Abdul Qayyum Khan was also present.

The AJK Prime Minister briefed the Bank chief about the priorities areas demarcated by the present government in AJK for domestic and foreign investment. These areas are the hydel power generation, minerals, tourism, forest based wastes recycling, horticulture and the spread of technical education.
The Prime Minister also lauded the role of the Bank in tackling the situation arising out of the devastating earthquake of October 8, in AJK and NWFP.

The Prime Minister and elderly Kashmiri leader Sardar Abdul Qayyum Khan also visited various section of the Bank and applauded their economic development role of the IDB in the Islamic countries.

The Prime Minister also invited the Bank chief to visit AJK to see for himself the potential of the vast investment there in private and public sectors. Dr Ahmad Ali Khan thanked the AJK Prime Minister for visiting the headquarter of his organisation and taking keen interest in the working of the Bank and its future projects.

 

[Neo]

ISLAMABAD: August 29, 2006:

President General Pervez Musharraf on Tuesday received a high-level Chinese delegation led by Liu Yunshan, Member of the Politburo of the Communist Party of China.

Welcoming the delegation, the president recalled his visits to China in February and June this year in the context of the talks that he had with President Hu Jintao in order to expand and deepen the excellent bilateral relations.

The president said that it was time to move towards bilateral co-operation on the broadest spectrum.

Referring to the 55th anniversary of the diplomatic relations between Pakistan and China, the president noted that the two countries enjoyed excellent diplomatic relations and there was a convergence of views on international issues.

President Musharraf invited Chinese investment in the high-tech, heavy industry and energy sector. He also invited the Chinese to establish an Engineering, Science and Technology University in Pakistan.

Referring to the communication links between the two countries, the president said that along with the up-gradation of the Karakorum Highway, a railway link, a fibre optic link and an energy pipeline could be established.

Liu said that Chinese President Hu Jintao is looking forward to his visit to Pakistan in the future adding that friendship between the two countries was in the hearts and minds of the people.

This all-weather friendship that had stood the test of time was in fact a paradigm of friendly collaboration between countries of different social set-up.

He expressed satisfaction at the co-operation of the two countries at the international level.

He fully agreed with the president's vision, which he called "inspiring", about the course of future co-operation and said that it would receive careful and positive examination by the Chinese side.

Liu Yunshan, accompanied by a 17-member delegation of the Communist Party of China, is visiting Pakistan from August 28 to September 1.

 

[Neo]

PESHAWAR: August 29, 2006

Ambassador of Japan to Pakistan, Seiji Kojima said on Tuesday that Japanese government would consider setting up of mega projects on the pattern of Toyota, Honda, Suzuki motors in Peshawar.

The Japanese envoy made these remarks while addressing a meeting of the members of the Sarhad Chamber of Commerce and Industry (SCCI).

The Japan government would look into the possibility of establishing mega projects in automobile sector in the city.

Seiji Kojima said, the procedure for obtaining Japan visa by the business community of the NWFP would made simple on the recommendations of the SCCI. He said Pakistan and Japan enjoy closed friendly and exemplary trade relations which are being strengthened with each passing day.

The government of Japan was proud of her relations with Pakistan, he explained. He also lauded the export of various goods from NWFP to Japan.

 

[Owais]

PSO sell-off put on back burner


ISLAMABAD (August 30 2006): The Privatisation Commission has put Pakistan State Oil (PSO) and other major entities' sell-off process on the back burner, at least for the first half of the current fiscal year. Sources in Privatisation Commission told Business Recorder on Tuesday that reversal of Pakistan Steel Mills Corporation (PSMC) privatisation was the major cause of delay in offering PSO and other public sector entities for bidding before December 31.

They said that other than PSO, NIT, SSGC, SNGPL, OGDC, PPL were some of the major companies whose privatisation was almost impossible in the next six months. They said that Privatisation Commission officials were totally confused over the post-PSMC sell-off situation and, despite repeated announcements by government top brass, they do not believe that the government would be able to come out of the PSMC shock to take up new companies for bidding.

They added that Privatisation Commission had informed about its position to International Monetary Fund IMF review mission vis-a-vis PSO and other major entities' sell-off for the current fiscal year.

It is interesting to note that Privatisation Minister Zahid Hamid has repeatedly announced to pursue the privatisation plan for 2006-07, to achieve the target. But his team clearly speaks of the question of credibility of Privatisation Commission after PSMC sell-off setback.

One member of his team, referring to Zahid's statements, said that the Minister's announcement were simply for the purpose of face saving and had nothing to do with the factual position.

He said the Privatisation Commission was working on only small transactions such as IPOs of different banks and OGDC, but no big company was now in the final stage for strategic sale before the end of the current calendar year.

 

[Owais]

70,000 tons gram will be imported before Ramazan


ISLAMABAD (August 30 2006): Private sector firms have opened Letters of Credit (LCs) for 70,000 tons black gram to be imported from Tanzania, Australia and Ethiopia, official sources told Business Recorder here on Tuesday.

"The private sector has opened 42 L/Cs for importing 70,000 tons black gram, which will reach here before Ramazan and the government will extend Rs 6 per kg subsidy," they said. Sources said that the orders placed by the private sector were in addition to 10,000 tons gram, which is already in the market.

Trading Corporation of Pakistan (TCP) has also floated tenders for importing 25,000 tons black gram, which may be imported from India, they said.

Minfal is of the view that stocks of Daal Mash (washed), Daal Masur, and daal Mung (washed) with local stockists and imported stocks would be available in the market before Ramazan. And it is expected that the prices of all pulses would remain stable, except gram due to its high demand in Ramazan.

Industries Ministry had recommended to the government that customs duty on RBD palm olien and palm oil should be reduced by Rs 4000 per ton to offset the impact of increase in prices in world market, but the top decision makers adopted wait and see policy.

An official in federal government said that edible oil price at the international level has started showing downward trend and would come to the previous level within a week.

He said that edible oil prices would also come down in local market. However, the government would continue strict monitoring of prices both before and during Ramazan.

 

[Owais]

July exports down 19.45 percent

KARACHI (August 30 2006): Exports in July 2006 recorded a fall of 3.85 percent to $1.269 billion over July 2005 and dipped by 19.45 percent to $1.220 billion compared with $1.515 billion in June 2006. According to the provisional figures released by the Federal Bureau of Statistics on Tuesday.

Exports during July 2006 amounted to Rs 73.558 billion as against Rs 91.160 billion in June 2006 and Rs 75.683 billion during July 2005, showing a decrease of 19.31 percent over June 2006 and of 2.81 percent over July 2005.

Main commodities of exports during July 2006 were knitwear (Rs 9,556 million), bedwear (Rs 9,175 million), cotton cloth (Rs 8,760 million), cotton yarn (Rs 7,053 million), readymade garments (Rs 6,872 million), rice basmati (Rs 5,559 million), rice others (Rs 3,676 million), towels (Rs 2,636 million), solid fuel including naphtha (Rs 2,080 million) and leather garments (Rs 1,498 million).

Imports into Pakistan during July 2006 amounted to Rs 148.295 billion as against Rs 179.668 billion in June 2006 and Rs 119.025 billion during July 2005, showing a decrease of 17.46 percent over June 2006 but an increase of 24.59 percent over July 2005.

In terms of US dollars, imports also decreased by 17.61 percent in July 2006 to $2.460 billion as compared to June 2006 $2.986 billion but increased by 23.25 percent as compared to July 2005 $1.996 billion.

Main commodities of imports during July 2006 were petroleum products (Rs 23,427 million), petroleum crude (Rs 20,290 million), other apparatus (telecom) (Rs 6,575 million, iron and steel (Rs 6,252 million), plastic materials (Rs 3,887 million), sugar (Rs 3,746 million), textile machinery (Rs 3,380 million), electrical machinery and apparatus (Rs 2,951 million) and palm oil (Rs 2,892 million) and fertiliser manufactured (Rs 2,807 million).

Based on the provisional figures of imports and exports the balance of trade in July, 2006 was (-) 74.737 billion in terms of Pak rupees and (-) 1.24 billion in terms of US dollars.

 

[Owais]

KESC to be given Rs 744 million subsidy


ISLAMABAD (August 30 2006): The government has decided to extend Rs 744 million subsidy to Karachi Electric Supply Corporation (KSEC) to offset the impact of 38 paisa (15+23) increase in tariff, allowed by National Electric Power Regulatory Authority (Nepra) a few months ago.

Sources told Business Recorder that the Ministry of Water and Power had dispatched the revised tariff notification for printing in the official Gazette on Tuesday.

They said that Nepra had also allowed KESC 28 paisa increase in tariff for the current fiscal year, but it is unclear if it would be passed on to the consumers, or the government would give subsidy. They said that the Ministry of Water and Power would submit the case to the ECC in its upcoming meeting for guidance.

Sources said that the Privatisation Commission (PC) has suggested that a inter-ministerial committee should be constituted, on permanent basis, to monitor the use of subsidy extended by the government to KESC.

According to sources, the utility is of the view that a realistic tariff formula should be in place to put it on a more viable footing, and enabling it to finance the capital expenditure required for availability and reliability of power supply, reducing energy losses, improving customer services and running it efficiently.

The power utility further says that its future power generation would be based on LPG, an alternative to natural gas, which would be almost 50 percent costlier.

 

[Owais]

Divergence in trade data

(August 30 2006): A vast difference of 3.69 billion dollars in the calculation of Pakistan's trade imbalance by the Federal Bureau of Statistics (FBS) and the State Bank for the year 2005-06 has raised eyebrows and created doubts in the minds of the people about the credibility of figures related to the international trade of the country.

According to the FBS data released earlier, Pakistan's exports stood at 16.45 billion dollars, while imports were reported to be at 28.58 billion dollars, indicating a huge trade imbalance of 12.13 billion dollars. Now the State Bank has put 2005-06 trade imbalance at 8.44 billion dollars after estimating imports at 24.94 billion dollars and exports at 16.50 billion dollars.

As is evident, most of the divergence in the two sets of figures could be attributed to a wide difference of imports amounting to 3.64 billion dollars. Most of the analysts believe that the SBP trade figures are always lower than the FBS figures because the State Bank figures are based on actual realisation of export proceeds and remittance of import payments to the sourcing/exporting country's banks, while FBS depends on the figures of trade documents lodged with the customs. The difference in the sources of data and the manner in which they are computed could, therefore, lead to the difference in figures.

This explanation, however, does not seem to be entirely satisfactory. Recognised that the methodology of computing data is different, yet the variation between the two sets of figures cannot probably be as large as reported for 2005-06. Historically, the difference has not been more than 10 percent and this is understandable.

The State Bank's data on export proceeds and import payments for a certain year may be the result of previous year's movement of goods across the border. The implication of such a development during 2005-06 could, therefore, be that fall in foreign exchange reserves during 2006-07 could be much more than expected because payments for actual imports of more than 3 billion dollars pending with the banking system at the end of June, 2006 would most probably fall due in 2006-07. This means more pressure on the balance of payments during 2006-07, which would call for more efforts for containing imports and expanding exports.

The government is pinning hopes on privatisation to generate about two billion dollars, remittances of about 4.5 to five billion dollars, floatation of bonds of about one billion dollars and exports to fetch 18 to 19 billion dollars, but any downgrading in Pakistan's credit rating may compound the problem of foreign exchange inflows. The foreign exchange reserves held by the State Bank amounting to about 10 billion dollars may also not be able to sustain a prolonged haemorrhage in the external sector of the country.

While all of this needs to be considered in an impassioned manner in due course of time, the relevant authorities must not shy away from giving a proper explanation for the large divergence in the two sets of trade figures for 2005-06 at the earliest to clear the confusion and restore credibility in the statistics released by the government agencies. In a private TV channel programme, the State Bank Governor disclosed that a team of State Bank officials was studying the issue of the big difference of trade imbalances figures. In our view, there is hardly any chance of a substantial error in the State Bank's figures because if it was so the foreign exchange reserves of the country should have shown a greater decline during 2005-06 and the balance of payments data as a whole might not have tallied.

However, there would be no harm if both the State Bank and FBS officials meet to analyse the situation and explain it to the interested circles without further delay. As it is, doubts are often expressed about inflation indices, poverty and labour force surveys, growth and employment statistics, etc which generally show a rosy scene. It would be a pity if external sector statistics of the country were also questioned resulting in damage to credibility.

 

[Owais]

Pakistan enjoys strategic partnership with China: PM
ISLAMABAD (updated on: August 29, 2006, 22:13 PST): Prime Minister Shaukat Aziz said on Tuesday Pakistan enjoys strategic partnership with China which is based on the strong trust, abiding co-operation and understanding of each other's positions on regional and global issues.

He was talking to a 16-member delegation of Chinese Communist Party Political Bureau, led by Member of Politburo & Secretariat of Central Committee and Minister of Publicity Department Liu Yunshan, that called on him here at the prime minister's chamber in the Parliament House.

The delegation is visiting Pakistan on the invitation of Pakistan Muslim League.

The prime minister said that the relations between Pakistan and China have withstood the changes in international environment and there is a great potential of further enhancement of relations between the two countries in the fields of politics, trade, economy, education, defence, security, culture and above all people-to-people contact.

He said Pakistan and China enjoy unanimity of views on all important regional and international issues. The two countries are opposed to terrorism and are pursuing common objectives of peace, security and better living standards for their population, the prime minister added.

Talking of the great potential for trade between Pakistan and China, the prime minister hoped that this year the trade between the two countries will cross $5 billion.

He said the Karakoram Highway provides the shortest link for export of goods from western China and the ports of Gwadar and Karachi provide the shortest route for import of gas and oil to China.

The prime minister said as a result of the macro-economic stability, consistency and continuity of policies and the level playing field provided to foreign investors, Pakistan has become an attractive destination for the private and public sector companies of China.

He said it is heartening to note that a large number of Chinese companies have started joint ventures with Pakistani companies for domestic consumption and export.

The prime minister said the world is fast moving towards a knowledge based economy. The two countries need to enhance co-operation in production of value added goods, Information Technology, Science & Technology and joint research for mutual benefits.

Talking of the importance of political linkages between Pakistan and China, the prime minister said linkages between PML and Communist Party of China provide the necessary platform for people-to-people contact which adds to the existing strong bilateral relations and diplomatic linkages between the two countries.

Liu Yunshan reaffirmed the views expressed by Prime Minister Shaukat Aziz and said Pakistan and China are true friends and 55 years of diplomatic relationship between the two countries serve as a model for the other countries.

Liu Yunshan appreciated the economic recovery and growth momentum achieved by Pakistan and said the expertise of Prime Minister Shaukat Aziz as an economist greatly contributed to the economic stability and development of Pakistan.

He said the recent visit of President General Pervez Musharraf and Prime Minister Shaukat Aziz to China contributed to further strengthening of relations between the two countries and hoped the visit of President Hu Jintao to Pakistan in November this year will be a landmark event.

He said there is a great potential of enhancement of co-operation between Pakistan and China.

He added that China desires to assist Pakistan in setting up Engineering and Media Universities and it also desires to further promote collaboration with Pakistan in the fields of science & technology, defence and security.

 

[Owais]

French investment invited in oil and gas sector

ISLAMABAD (August 30 2006): Federal Minister for Petroleum and Natural Resources Amanullah Khan Jadoon has invited French investors to avail investment opportunities in Pakistan, saying the government is providing a level playing field to prospective investors in oil and gas sectors.

He was talking to French Petroleum Company Total Chief Executive Officer Emmanuel Laurante, who called on him here on Monday and discussed matters pertaining to oil and gas co-operation. The minister said the government had deregulated the petroleum sector and there existed large opportunities for investment by local and foreign investors.

The government, he said, was providing lucrative incentives and allied facilities to the investors in oil and gas activities and upgrading of refineries and set up coastal refinery.

French Company's CEO appreciated the investor-friendly policies of the government and assured that the French investors would continue to participate in upcoming oil and gas projects for mutual benefit. Additional Secretary of Petroleum Shaukat Hayat Durrani and officials of the ministry were also present

 

[Neo]

KARACHI, Aug 29: Libya has shown keen interest in purchase of around 50,000 tons of Irri-6 from Pakistan. In this regard a delegation from Tripoli is expected soon to inspect rice processing and quarantine facilities, official sources disclosed on Tuesday.

The development has been described a breakthrough. Libya has not purchased rice from Pakistan before and this deal, if materialised, could open up a new market for Pakistani rice.

The sources indicated that the deal would be carried out at government-to-government level and it could be used as a swap against loans taken by Pakistan from Libya.

However, official sources did not disclose the amount of loans against which the rice deal was taking place but confirmed that Libya had shown interest in purchase of rice (Irri-6) from Pakistan.There had been great demand for Pakistani basmati rice in Arab countries of the Middle East and this would be for the first time that an Arab (African) nation purchases Irri-6 rice from Pakistan.

According to market sources presently world market rates of Irri-6 are being quoted at around $240 per ton and once the deal was through it would fetch around $120 million for the country. However, if the deal was made against outstanding loans this amount may be swapped.

The sources said that a lot of enthusiasm was being shown by official circles with regard to this deal as it was being looked upon as an opportunity for capturing a new market of a sizeable quantity for export of rice.

According to some estimates the country would have a bumper rice crop this season. It is generally being felt by the private sector that the total production would come to around 5.6 million tons. The country has already managed to cross a billion dollar mark in export of rice during last season.

However, these analysts feel that Irri-6 may be in less production this season due to the late availability of water but are optimistic about the overall cultivation of paddy.

It is being generally felt that the superior quality rice with aroma of E-98 variety, also known to be as good as original basmati, would be in larger quantities in Sindh this season.

The analysts further said that the E-98 variety grew well in less water at its initial stages and could compensate the paddy growers fairly well against the expected loss on account of Irri-6 crop.

They opined that since this variety required more investment towards input cost but was equally poised to fetch higher price in the world market for being of long grain, high quality and also having almost same aroma as of original basmati.

Indian exporters had been exporting this variety in the world market under the name of original basmati and even managed to get high price close to the price of basmati, which ranged from $400 to $700 per ton.

 

[Neo]

By Farhan Bokhari, Special to Gulf News

This week's protests in Pakistan's Balochistan province following the killing of the most prominent tribal elder of the area, do not bode well for the region's prospective gas explorers.

Balochistan has often been described as Pakistan's singular region rich in gas reserves. Not only is Balochistan home to the largest gas reserves so far discovered in Pakistan, the province, more importantly, stands at the centre of plans by the Pakistani government to transport gas to the country from nearby countries such as Iran or the newly independent central Asian states supplying gas through Afghanistan.
The late Nawab Akbar Khan Bugti, who died on Saturday in an operation carried out by the Pakistani military, had taken it upon himself to become the self appointed advocate for the rights of the Baloch people.

He opposed plans by the government of pro-US leader General Pervez Musharraf to back new ventures in his province, ranging from deployment of military troops at newly-created military cantonments to development of new facilities for prospective foreign investors.

Many Pakistanis may well have lamented Bugti's style of politics. He was reputed to run his own justice system in parallel to the government, with provisions ranging from sentencing of individuals to private prisons where they were jailed.

In the immediate aftermath of Bugti's death, there is widespread violence from protesters across Balochistan. It is clear that the government of General Musharraf has obviously underestimated the political fallout. Warnings of a long war have been delivered publicly by some of Balochistan's leading political leaders, which must be disconcerting for prospective investors.

There can just be no enduring peace and settlement in Balochistan as things appear to look for the foreseeable future. Consequently, the idea of attracting investors to take long-term stakes in the range appears as faulty as ever.

The Pakistani government's promise to oversee billions of dollars flow in to new investments in Balochistan which would lead to a sharp rise in the volume of gas supplied, appears doomed to fail for now. In brief, the promise of taking Pakistan towards a new era of prosperity, thanks to the prospective gas projects, is one that probably went down the tube when Bugti's mountainous hideout in a remote area was attacked.

The delay in undertaking new gas projects of course only promise to cause a huge setback to Pakistan's economic interests. In the past few years, Pakistan's foreign lenders have urged the south Asian country to take steps towards arranging new sources of gas supply as the country's existing gas reserves, by some estimates, could run out in the next two to three years.

Not too long ago, Pakistan tasted the experience of gas shortages when some of Bugti's followers allegedly destroyed a portion of the gas pipeline running from Balochistan to elsewhere in the country. They could not have chosen a more opportune time, right at the peak of the winter months, when gas shortages truly hit domestic consumers, and the significance of Balochistan to Pakistan's overall comfort level was adequately highlighted.

With a new round of mayhem in Balochistan following Bugti's death, its impossible to predict the extent to which Pakistani authorities would successfully meet the challenge of keeping the existing pipelines secured from the province.

But even if they succeed in meeting that challenge, the next challenge of overseeing large new investments flow to the region, chasing new opportunities for gas exploration, is likely to remain a distant dream.

Ultimately, Pakistan's pro-US rulers have to reconcile themselves to a fundamentally vital reality. But political mistakes of the kind made with Bugti's death is bound to unleash not just political but also economic consequences.
​

 

[Neo]

Wednesday, August 30, 2006javascript:; http://www.dailytimes.com.pk/print.asp?page=2006\08\30\story_30-8-2006_pg5_3

ISLAMABAD: The Mahbub-ul-Haq Human Development Centre will launch its ninth annual report on human development in South Asia 2005 at a local hotel on Wednesday. The report, entitled Human Security in South Asia, analyzes the socio-economic and political factors threatening human security in South Asia.

Analyzing the notion of human security from multiple dimensions, the report records that the current patterns of economic growth in South Asia have made million of people vulnerable and insecure to even the slightest shocks. It also demonstrates how conflicts in the region both among states and within continue to divert resources towards defence. Another focus area of the report is the increasing environmental degradation in South Asia and deteriorating health conditions which threaten the very existence of the people in the region. The report also analyzes the international biases that restrict gender equality in South Asia.

High-level governmental officials, representative of diplomatic missions, international development institutions, academic community and civil society will attend the launch. The panel of speakers includes Kadija Haq, Jania Bjorn Kanavin, Ambassador of Norway, Dr Arfa Syeda Zehra, Chairperson of the National Commission on the Status of Woman, Jan Vander Moortele, resident representative of the UNDP, and Dr Ishrat Hussain, Chairman of the National Commission for Government Reforms. Dr Najam and Dr A R Kemal will also comment on the state of human security in Pakistan.

 

[Neo]

Wednesday, August 30, 2006javascript:; http://www.dailytimes.com.pk/print.asp?page=2006\08\30\story_30-8-2006_pg5_11

KARACHI: The profit after taxation of Pak Suzuki Motor Co Limited (Suzuki motor) surged by 167 percent to Rs 2.06 billion in the January-June 2006 period due to increasing sales.

"The sales of the company have gone up during the said period," an analyst said. "The company is also making further investment to expand its plant in Karachi."

The net earning of the company stood at Rs 2.06 billion for the Jan-Jun 30, 2006 period compared with the Rs 770 million earned in the same period last year. The earning per share was Rs 38.1 compared with the Rs 14.3 in the first half of 2005.

Net sales of the company grew to Rs 24.26 billion versus Rs 16.9 billion last year - a growth of 44 percent.

 

[Neo]

Manufacturers increase to 50, more seeks licence

By Imran Ayub

KARACHI: The number of motorcycle manufacturers in the country has reached 50 as majority of the local producers have acquired Chinese technology and are expected to produce 800,000 bikes by December 2006.

A top official said that the government offered manufacturing licences in May 2006 but there were still several players, with both local and foreign investments, waiting to get a nod from the authority concerned.

“A meeting of our body was held before the federal budget 2006-07 in which licences were awarded to the interested parties, which increased the number of local motorcycle manufacturers to 50,” said Imtiaz Rastgar, Chief Executive Officer of Engineering Development Board (EDB).

“Since the announcement of budget we have not yet issued a single licence, but our policy is to expand the local market for both local and international players in a bid to increase competition and enhance quality.”

He said less than half a dozen motorcycle manufacturers were operating with Japanese technology as most of the new entrants preferred to adopt Chinese techniques of motorcycle production.

“Now those manufacturers with Japanese technology are planning to expand their production capacity to compete in the market,” said Rastgar.

The country’s motorcycle production industry started witnessing phenomenal growth some three years ago, when several local assemblers acquired Chinese technology with most of the production units set up in different industrial estates of Punjab.

By the end of 2005, some 35 assemblers were producing different categories of motorbikes in different industrial estates. Pak Hero Industries, Atlas Honda, Pakistan Cycle Industrial Co-operative Society Limited, Saigols Qingqi Motors Limited, Excel Industries, New Asia Automobiles, United Sales, Blue Star Automobile, Pacific Motor Company Limited, HKF Engineering (Pvt) Limited, Sazgar Engineering Works Limited, Star Asia and Zxmco Pakistan enjoyed the major market share by the end of last calendar year.

Similarly, Suzuki Motorcycle Pakistan Limited, Dawood Yamaha Limited, Dewan Motorcycles Limited, Ahmed Automobile Company, NJ Auto Industries, Sitara Auto Impex and AB Engineering also designed plans to produce different-styled motorbikes last year.

The EDB chief said there were several other players who were interested in investing in the country’s auto industry and they would enter the market by the end of current financial year.

He said increase in Chinese motorcycle brands had pushed the Japanese assemblers to increase their interests in Pakistan and plan fresh investment strategy for the country.

“It is our market expansion policy, which encouraged Honda Atlas to set up a new motorcycle assembly plant in Lahore to meet growing demand,” added Rastgar.

Like Honda, he said, other foreign manufactures of motorcycles in Pakistan would also increase their capacity in the days to come.

Honda a few months ago set up a new $39.13 million motorcycle production plant in Lahore. The new plant would increase company’s combined annual production to 500,000 motorcycles from the current 400,000 motorcycles.

In 2005-06 total seven foreign assemblers managed to sell 516,640 pieces of the product compared to 417,066 sold out in 2004-05. The assemblers produced total 520,124 motorcycles during 2005-06 compared to 416,189 manufactured in 2004-05.