Pakistan Customs cleared more than 4,400 used vehicles in July under personal baggage, gift, and transfer of residence schemes, data shows, prompting concerns over potential misuse and negative effects on the local automotive sector. The imports included over 600 high-value vehicles worth nearly Rs 50 billion, according to industry sources.
According to a news report, out of the total, 3,996 vehicles were cleared under the Personal Baggage scheme, 331 through the Gift scheme, and 96 via the Transfer of Residence scheme. Customs officials said used cars remain banned for commercial import.
The influx of used vehicles is putting pressure on Pakistan’s domestic automotive industry, which employs over 330,000 workers directly and supports roughly 1.5 million jobs in allied sectors. Analysts estimate that July’s imports alone cost local vendors around Rs 6.5 billion in lost revenue, based on the local content embedded in each car.
Analysis of the import data shows that many luxury vehicles were declared at values far below their market price, ranging from 10,000 to 250,000 Japanese Yen (approximately Rs 19,000 to Rs 4.7 million), indicating potential under-invoicing of nearly 99%. In one instance, a 2020 Toyota Land Cruiser was declared at Rs 19,000, far below its actual market value.
Industry sources highlighted that several importers, claiming vehicles under personal schemes, reside in the UAE and have no travel history to Japan, where the vehicles were purchased. Export certificates and shipping documents often indicated commercial transactions rather than legitimate personal baggage, gifts, or transfers.
Pakistan has averaged 34,000 used car imports annually over the past decade, making second-hand vehicles the second-largest source of cars in the market. The 2024-25 period saw nearly 40,000 used vehicles imported, representing almost 25 percent of total market share and causing an estimated Rs 60 billion in lost revenue for local parts manufacturers.
Experts note that this level of imports is unusual for automotive-producing countries. Nations like India, Thailand, and Vietnam have effectively restricted used car imports to protect domestic manufacturing.
