Industry stakeholders say Pakistan’s growing budget deficit could be met by reducing the amount of goods smuggled out of the country, which is a blow to the economy.
They also allege that illegal trade in and smuggling of critical products such as medicines, lubricants, vehicle spare parts and tires costs the government a lot of money.
Tire smuggling alone costs the government more than Rs40 billion a year, in addition to harming the indigenous economy.
However, the annual demand for tires in the country is estimated at 14 million units. Domestic production accounts for about 15% of total demand, while legal imports account for the remaining 35%. While the remaining 50% of the demand is met by smuggled tires.
Tire imports have recently declined due to the Pakistan State Bank’s requirement for a 100 percent cash margin on imports, and the instability of the global market.
