Pakistan’s Auto Market Faces New Storm After Import Exemption

Pakistan’s Ministry of Commerce has introduced fresh measures to streamline the import of used vehicles by clarifying the requirements for Pre-Shipment Inspection (PSI) certificates and granting a conditional one-time exemption for certain vehicles imported under the Gift and Transfer of Residence schemes. According to the new directives, PSI certificates issued through registered inspection companies linked with Japanese principals will be accepted, while the Federal Board of Revenue (FBR) and Customs authorities must verify every certificate directly to prevent fraud and ensure accountability. The ministry has also made it clear that only vehicles meeting environmental, safety, and quality standards will qualify for clearance, with poorly rated or accident-damaged vehicles remaining ineligible. However, the policy has sparked strong opposition from Pakistan’s local automotive industry, which argues that the exemption could significantly impact domestic manufacturers and parts suppliers. Industry estimates suggest that nearly 15,000 imported vehicles may enter the market under the waiver, potentially reducing local sales, increasing pressure on already underutilized assembly plants, and affecting government revenue. Analysts also caution that frequent policy changes may create uncertainty for foreign investors and weaken confidence in Pakistan’s long-term industrial and manufacturing landscape.