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FBR asked to issue SRO on duty incentives to new entrants in motorcycle industry

FBR asked to issue SRO on duty incentives to new entrants in motorcycle industry

ISLAMABAD: The Ministry of Industries and Production issued a reminder notice to the Federal Board of Revenue (FBR) to issue an SRO providing duty incentives to new entrants in motorcycle industry. Sources said as soon as the SRO is issued by FBR an agreement with Yamaha Motorcycle would be signed paving way for $150 million investment.

The Economic Co-ordination Committee (ECC) of the Cabinet meeting, chaired by Finance Minister Ishaq Dar on October 2, 2013 was informed that the last hurdle in the way of proposed investment by Yamaha would be removed when FBR issues the SRO. The minimum investment for new entrants in motorcycle manufacturing industry was fixed at $100 million subject to the condition that the investor brings in new technology and achieves localisation plan approved by the ECC.

A meeting of the ECC held on September 7, 2013 approved M/s Yamaha Motorcycle Industries as qualified under the new entrant policy for motorcycle industry with new technology on the recommendation of the Engineering Development Board (EDB) as well as a committee headed by Secretary Industries and representatives of Board of Investment. Sources said the new entrants in motorcycle industry would be allowed incentives to import those CKD units which are also produced locally at 10 percent duty in any form for a period of five years. The additional customs duty would not be imposed on sub-components and components imported in any kit.

The concessions would be withdrawn on the parts localised by new entrants each year in accordance with the approved localisation plan. The new entrants” policy envisages achieving localisation level of minimum 25 percent at the start of commercial production and would be required to achieve 85 percent by the end of five years.