The auto industry is a vital part of Pakistan’s economy. In this blog, we will look at the automotive industry’s contribution to the national economy. We will also look at how Pakistan’s auto industry is growing and how opportunities in this industry can help Pakistan’s economy grow.
3.4 billion rupees (approximately $31 billion) of automotive imports in 2017 are projected to increase to 4 billion rupees (approximately $41 billion) in 2018 and to 5.5 billion rupees (approximately $56 billion) by 2020.
automotive industry in Pakistan is divided into 2 segments: light vehicles and heavy vehicles. The light vehicles segment is further sub-divided into passenger cars, LCVs and motorcycles. Whereas the heavy vehicles sector comprises of trucks and buses.
The automotive industry has been a major contributor to Pakistan’s Gross Domestic Product (GDP) and to the national exchequer in terms of taxes and duties. Moreover, full employment along with higher income and investment, generated by the process of industrialization, have increased the purchasing power of the people.
Government’s Economic Zones Development and Management Company (EZDMC) supported by Ministry of Industries and Production, aims to promote Pakistan’s automotive industry.
The Automotive Industry in Pakistan has been growing at a steady rate
The automotive industry in Pakistan is booming. It contributes (2.8%) to the country’s GDP and 30 billion rupees to the national exchequer in terms of taxes and duties. Pakistan is home to the world’s sixth largest population with a growing middle class.
There are approximately 17 million middle class households and 102 million middle class individuals as of 2018. The rising income has led to a boom in the automotive industry. The number of vehicles in Pakistan has grown by 7.2% in the last year. Furthermore, the industry is expected to experience the sixth highest growth in the world.
The Automotive Industry in Pakistan 2017
The automotive industry in Pakistan has seen a surge in the demand for new cars and new motorcycle in the past few years. Due to this demand and increase in the population of Pakistan, the automotive industry has been able to contribute 2.8 percent to the GDP of Pakistan.
In terms of taxes and duties, this industry contributes 30 billion rupees to the national exchequer. In fact, the automotive industry is one of the top three foreign exchange earners in Pakistan, with the help of the two neighboring countries of India and Bangladesh.
Automotive industry of Pakistan has a history of more than 70 years. Pakistan has a fairly well-established automotive sector, which is a major contributor to the manufacturing industry. The sector provides employment to many skilled workers and has a large potential for further development.
The industry has a vital role to play in the country’s economy as it contributes 2.8% to the Gross Domestic Product (GDP), 30 billion rupees to the national exchequer in terms of taxes and duties and provides employment to nearly 200 thousand people.
The Top Three Automotive Companies in Pakistan
One of the most thriving industries in Pakistan is the automotive industry. The top three companies that are ruling the country’s automobile industry are Honda, Toyota and Suzuki and all of them are Japanese Automobile manufacturers.
This industry is one of the most flourishing and profitable industries in Pakistan. It is also regarded as a vital industry of Pakistan. The automotive industry in Pakistan produces about 10,000 cars annually, which is approximately 8% of the total production in the world.
This industry has a lot of potential in the country. It is one of the fastest growing industries in Pakistan. The automotive industry in Pakistan is doing quite well in terms of production and exports. The country’s automobile industry contributes (2.8%) to its GDP and 30 billion rupees to the national exchequer in terms of taxes and duties.
The Top Three Upcoming Brands
The auto industry in Pakistan is witnessing an unprecedented expansion. Worldwide top brands are coming to Pakistan which include Peugeot, MG, KIA, Hyundai and Tesla. Against the backdrop of an expanding economy and a growing population, the industry is expected to grow at an average rate of 8% per annum to reach a market size of $2.8 billion by 2021.
Importantly, the auto industry is an important contributor to Pakistan’s economy contributing 2.8% to its GDP and 30 billion rupees to the national exchequer in terms of taxes and duties. The automotive industry is booming in Pakistan.
With a growing middle class, the country is poised to become one of the biggest automotive markets in the world. It’s no surprise then that foreign companies are taking notice of Pakistan’s growing car market. In 2017.
Pakistan ranked as the fifth largest market for the German automotive manufacturer, BMW. Even though Pakistan’s new car market is still small, it is the fastest growing market in the world. The Pakistan Automotive Manufacturers Association predicts that Pakistan’s car market will grow by 10% annually until 2025.
This year, 2023, will be the fourth year that the Pakistani car market has experienced double-digit growth since 2018. The country is also expected to add more than 50,000 vehicles to its roads this year, which is a record number.
Automobiles are the most important aspect of the economy of Pakistan. The three largest cities in Pakistan are Karachi, Lahore and Faisalabad. Therefore the demand for automobiles is very high. This demand is met by establishing an automobile industry in the country.
The automobile industry contributes (2.8%) to the GDP and 30 billion rupees to the national exchequer in terms of taxes and duties. The automotive industry is a major contributor to the economy of Pakistan and its the fastest growing industry.