Tyre industry: Smuggling on the rise, laments industry

Officials said that the jump in smuggling is not being tackled by the government which is the single most important factor contributing to its rise.

KARACHI: Local industry officials have expressed concerns on the rise of tyre smuggling from Afghanistan that, they say, has seen an unprecedented rise in recent months, making it difficult for the industry to sustain even its regular sales.

Officials said that the jump in smuggling is not being tackled by the government which is the single most important factor contributing to its rise.

While suggesting a counter strategy, an official of a local tyre manufacturer said the Federal Bureau of Revenue’s (FBR) Investigation and Intelligence wing should conduct raids on the tyre market in Rawalpindi and ask for documents from shop owners. In absence of documents, they should simply confiscate the tyres, he said.

He further suggested that this practice should be augmented and such raids should be conducted in tyre markets of Lahore, Karachi and other major cities to stop the shopkeepers from dealing in smuggled items. This will force the smugglers to eventually withdraw from the main consumption centres where some of them even have warehouses to store smuggled tyres, he added.

According to the industry, sharp increase in smuggling of tyres from Afghanistan has already caused a serious blow to local tyre production.

Industry people say that FBR should take stern measures to root out shops selling smuggled tyres that have mushroomed in major cities of the country.

Pakistan’s annual consumption of tyres is about 8 million out of which, industry officials estimate, around 2.5-3 million tyres are smuggled into the country.

According to industry estimates, Pakistan produces around 20% of the total tyre demand of the country, while 48% are imported and 32% are smuggled into the country. Total market demand in the year 2012-13 was 8,224,000 tyres out of which 1,654,700 were produced locally, 3,941,500 imported and 2,627,800 were smuggled.

Tyre industry is one of the industries, like tea and tobacco, that are affected by smuggling through the Afghan Transit Trade (ATT) but Pakistan authorities have long ignored rampant smuggling through  the porous Afghan border.