Toyota Indus temporarily 'shuts down' manufacturing unit in Pakistan
Business
Toyota Indus 'Shuts Down' it's manufacturing in Pakistan
(Web Desk) – The Indus Motors Company (IMC), Toyota vehicle producers, recently announced ending its production plant in Pakistan from Dec 20 to 30, citing a delay in import approvals from the State Bank of Pakistan.
The IMC management stated in a letter to the general manager of the Pakistan Stock Exchange that a new procedure for obtaining prior clearance for the import of “CKD kits and components of passenger cars (HS Code 8703 Category)” for the auto industry had been introduced by the central bank.
“The mentioned delay in the company and vendor clearances has posed challenges in the import and clearing of consignments for raw materials and company components.
The letter stated that the company was unable to continue its manufacturing activities because “this has resulted in insufficient inventory levels and consequently has produced a detrimental impact on the supply chain and production activities.”
Earlier, the reports said that because of SBP restrictions beginning on May 20 (the bank implemented a process requiring prior approval from SBP for the import of some items, including CKDs), auto assemblers had to take days off from work.
Manufacturers claimed that the decision had been delaying payments to international suppliers, which had put the local economy in great danger.
“These restrictions have so far delayed around $25 million in foreign payments, which has caused investors to lose faith in the Pakistani market, and any additional delays in the SBP’s approvals will prevent $80 million from being contributed to the exchequer,” they continued.
They stated that the industry was now engaged in development activities for a number of new models. The manufacturers, vendors, and assemblers must import equipment, molds, tools, and fasteners for the creation of new technology vehicles and parts. The trial activities must be carried out several months before the start of mass production to ensure the smooth growth of local parts.
