Proposal sent to the government for approval under the newly drafted Auto Policy for 2026-31
- Moves aim at boosting Pakistan’s weak export performance.
- Policy under discussion with the IMF before cabinet approval.
- The scheme targets multi-million-dollar export opportunities.
The Special Investment Facilitation Council (SIFC) has proposed introducing an import-refurbishment-export (IRE) model for used cars in Pakistan, on the lines of Dubai’s Jebel Ali framework, to boost the country’s export potential.
In the aftermath of the Gulf War, this proposal has been forwarded to the federal government under the newly drafted Auto Policy for 2026-31, as “it can become a good business in the country,” The News reported.
Pakistan is eyeing multi-million-dollar exports with the help of this proposed mechanism at a time when the country’s exports are struggling to achieve the desired target. The auto policy is currently in negotiation with the International Monetary Fund (IMF), and then it will be tabled before the federal cabinet.
The auto policy has proposed the establishment of import, refurbishment, and export of used vehicles in order to give impetus to boost exports. It will replicate the international practice on the pattern of Dubai/Jebel Ali. It provides duty suspension incentives under the Export Facilitation Scheme (EFS).
Top official sources confirmed to The News on Tuesday that the IRE scheme is designed to create a licensed industry for importing used vehicles, refurbishing domestically, and then exporting the refurbished vehicles from Pakistan to different destinations around the world.
By leveraging duty suspension and export facilitation, the policy seeks to stimulate investment in specialised refurbishment facilities, generate export revenues, and integrate Pakistan into the global automotive value chain.
Eligibility and procedures are defined for any qualified operator (sectoral basis, not a single pilot) under the Export Facilitation Scheme (EFS) and Import Policy Order (IPO) 2022.
The Federal Board of Revenue (FBR) may amend the relevant regime to facilitate the same. These vehicles will not be allowed to be sold in the local market.
According to the sources, only duly registered companies may operate in the IRE sector. Operators must be incorporated under the Companies Act and have sufficient financial and technical capacity, including a demonstrated business plan for refurbishment and export.
In addition, the IRE firms must obtain specific approval from the Ministry of Commerce and Industries (as a sectoral export project) and register under the EFS for the IRE sector.
They must also demonstrate that their facility has the required refurbishment infrastructure as verified by the Engineering Development Board (EDB).
Vehicles imported under the IRE framework must be re-exported within a specified time frame of up to nine months. Accordingly, each vehicle (or batch) must exit Pakistan no later than nine months from the date of import.
In exceptional circumstances, limited extensions may be granted, subject to valid justification and additional financial security. Failure to re-export within the prescribed period will result in a violation of this policy, and the FBR may take appropriate action according to its rules and regulations.
Reference Link:- https://www.geo.tv/latest/663080-sifc-proposes-export-of-refurbished-used-cars