Senate committees have expressed grave apprehension over the potential loss of two million jobs as Pakistan’s automotive industry struggles with falling sales, triggered by the government’s decision to reduce tariffs on imported used cars. The joint session of the Senate Standing Committees on Finance and Revenue, and Industries and Production, led by Senator Saleem Mandviwalla and Senator Aon Abbas, met on Monday to address the crisis.

Auto industry delegates cautioned that the relaxed import duties, a measure tied to International Monetary Fund (IMF) agreements, have drastically reduced new vehicle sales. They pointed out that domestic vehicle output has stagnated at approximately 150,000 units annually-a figure unchanged since 2004-despite advancements in local manufacturing.

Ministry of Commerce officials justified the policy, stating that facilitating used car imports promotes market competitiveness and benefits consumers. They hinted at further tariff reductions in the future and the possibility of extending the permissible import age of vehicles beyond five years.

Toyota Indus Motors representatives emphasized the substantial tax burden on new cars, citing the example of the Fortuner SUV, which carries government levies amounting to Rs. 14.4 million on a Rs. 24.4 million sticker price.

While Senator Muhammad Abdul Qadir endorsed the government’s approach for fostering competition, the joint committees warned that it could threaten the livelihood of nearly two million families who rely on the auto sector. They advocated for a balanced tariff structure to safeguard both the industry and employment.

The committees also examined the closure of the Utility Stores Corporation, with the Ministry of Industries and Production outlining a proposed Rs. 14 billion relief program for impacted workers.

Furthermore, they addressed a recent fire at the Karachi Export Processing Zone, attributed to waste disposal delays, directing the Federal Board of Revenue (FBR) to implement a system for prompt waste removal. Concerns were also raised about new taxes imposed in Export Processing Zones, despite legal safeguards. The FBR clarified that this issue is under consideration within the framework of the planned industrial policy. Senators and government officials, along with auto industry stakeholders, attended the session.