Pakistan to gradually open auto market under IMF deal

Pakistan has agreed to the International Monetary Fund's (IMF) request to revise its automobile sector liberalization plan, gradually phasing out protection for local industries starting in the next fiscal year, sources said.

The IMF has consistently raised concerns about the protection afforded to Pakistan’s industries, particularly the automobile sector.

During recent talks, the Washington-based lender reportedly highlighted Australia’s automobile model as an example of successful liberalization. Pakistani officials, however, countered that Australia only began importing vehicles after implementing auto-sector reforms.

Sources also said Pakistani officials noted that while the United States imposes tariffs to shield its domestic industries, the IMF is urging Pakistan to open its markets to foreign companies.

To address trade-related issues, the government has established a high-level committee to review trade tariffs ahead of the next federal budget.

Starting in July, Pakistan plans to eliminate additional customs duties on specific goods, according to sources.