Indus Motors Company (IMC) the maker of Toyota cars in Pakistan has announced that they are to shut down its production plant in the country from December 20-30, citing a delay in import approvals from the State Bank of Pakistan (SBP). Indus Motors sent a letter addressed to the general manager of the Pakistan Stock Exchange, the IMC management said that the central bank had introduced a new mechanism for obtaining prior approval for the import of “CKD kits and components of passenger cars (HS Code 8703 Category)” for the auto sector.
“The aforesaid delay in the approvals for the company and vendors has created hurdles in the import and clearance of consignments for raw materials and components of the company. This has resulted in insufficient inventory levels and consequently has created an adverse impact on the supply chain and production activities,”
Pakistan’s auto industry is already highly dependent on imports and has been caught in the midst of an exchange-rate crisis, as the SBP, after unabated rupee depreciation, imposed restrictions on the opening of Letters of Credit (LCs).
Officials of IMC in a corporate briefing session said import restrictions imposed by the central bank and ongoing rupee depreciation are denting the country’s auto sector.
Officials at the time said that the industry is bearing the burden of escalating production costs on account of rupee depreciation, while demand has declined due to the economic downturn amid high-interest rates and...
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