Toyota automobile manufacturer Indus Motors Company (IMC) has chosen to close its manufacturing in Pakistan from December 20 to 30.
In a letter issued to Stock Exchange Pakistan, Indus Motors claimed a backlog in import permissions is pending from the State Bank of Pakistan (SBP).
In a letter, the IMC management informed the Pakistan Stock Exchange general manager that the State Bank of Pakistan had implemented a new system for obtaining prior authorization to import “CKD kits and components of passenger automobiles (HS Code 8703 Category)” for the auto sector.
Indus Motors Company, in the letter to the Stock Exchange, stated that the IMC couldn’t continue production; the letter said, “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.”
Due to restrictions imposed by the SBP, auto assemblers were required to observe non-production days beginning on May 20, as the bank implemented a process requiring prior authorization from SBP to import certain commodities, including CKDs.
According to assemblers, the decision has caused delays in payments to overseas suppliers, posing a substantial commercial risk for local industry.
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