Executive Summary

Pakistan Engineering Industry has a large potential to grow and contriute towards GDP and
Export. It is diverse and all its sub-sectors have their own dynamics and value chain. On one
hand, the diversity can become a challenge while on the other hand, it provides an opportunity to
growth due to wide convas. Pakistan Engineering Industry has proven to rebust and dynamic and
has shown promissing growth during the last few years even in difficult times when other sectors
of economy did not perform well. However, the huge potentioal of export growth in engineering
goods remain unutilized due to multiple reasons. The Govt. did not focus on engineering industry
with all its possibilities as it has remained busy in promoting other traditional export sectors.
Also, the engineering industry itself has not been forthcoming in framing issues, seeking solution
and projecting its potential.
 INTRODUCTION

There are four broadly classified product divisions, namely, Agro and Food, Textile and Clothing,
Minerals and Metals, Engineering and Other Manufacturing.

Engineering and other manufacturing division mainly looks after export promotion of
engineering goods including ​electrical fans, transport equipment and other electrical
machinery, Machinery specialized, auto parts & accessories, plastic and its products, furniture
and cement​ are also covered under the scope of this division.

​(​Source:- TDAP website) 

ENGINEERING GOODS
1) Machinery & Transport Equipment
a) Electric Fans
b) Transport Equipment
c) Auto parts & Accessories
d) Other Electrical Machinery
e) Machinery Specialized for Perticular Industry
f) Other Machinery
2) Surgical Instruments
3) Cutlery
4) Sports Goods
Pakistan Vehicles Production and Sales (Last 5 Years)

​(​Source:- Pakistan Automotive Manufactureres Association) 

2013-14 2014-15 2015-16 2016-17 2017

Vehicles P S P S P S P S P

Cars ​(800-2000) 116,605 118,102 152,524 151,134 179,944 1 181,145 186,936 185,781 202,426

Ttrucks 2,674 2,663 4,039 4,111 5,666 5,550 7,712 7,499 8,544

Buses 558 577 575 569 1,070 1,017 1,118 1,130 714

Jeeps 1,217 1151 1,109 1163 773 775 3,530 3,534 12,478

Pic-ups(LCV) 17,477 17,635 28,189 27,656 35,836 35,759 24,265 23,804 27,178

FarmTractors 34,521 33,584 48,883 46,800 34,914 33,986 53,975 54,992 67,371

2/3 wheelers 771,507 772,046 1,131,19 1,132,8 1,362,096 1,358,64 1,632,96 1,630,73 1,744,7
06
6 87 3 5 5
Pakistan Export of Engineering Goods (Last 5 year)

Exports of Total Country Exports

Engineering Goods
Engineering
%Inc/De %Inc/Dec share in
Year c over over total Exports
Actual Actual (%)
previous previous
year year

(​Source:- A Presentation of EDB, Ministry of Industries)

(Million Us $)

2012-2013 117,517 13.38 2,366,487 12.12 4.96

2013-2014 123,945 5.46 2,583,463 9.16 4.79
2014-2015 107,174 - 13.58 2,397,512 - 7.19 4.47
2015-2016 93,658 - 12.61 2,166,846 - 9.62 4.32
2016-2017 89,408 - 4.56 2,138,186 - 1.32 4.18

Import of Engineering Total Country Import Engineeri

Goods ng share
in total
%Inc/Dec %Inc/Dec Imports
Year over over
Actual Actual (%)
previous previous
year year

2012-2013 11,801 5.49 44,974 0.09 26.23

2013-2014 12,301 4.23 45,022 0.10 27.32

2014-2015 14,716 19.63 45,850 1.84 32.10
2015-2016 16,587 12.71 44,696 -2.52 37.11
2016-2017 20,576 24.04 52,915 18.38 38.88
 Pakistan Import of Engineering Goods​ (Last 5 Years)
(​Source:- A Presentation of EDB, Ministry of 
Industries)

EXPORTS

TOP 10 ITEMS OF ENGINEERING SECTOR

EXPORTS

No: ​ITEMS JULY JULY

2016-17 2017-18
OPTICAL,PHOTOGRAPHIC,CINEMATOGRAPHIC,MEASURING,MEDICAL OR
1 SURGICAL INSTRUMENTS AND APPARATUS,PARTS AND ACCESSORIES 23.25 30.35

2 TOOLS,IMPLEMENTS,CUTLERY,PARTS THEREOF 6.57 8.01

3 ELECTRICAL MACHINERY,EQUIP,PARTS 4.06 7.86

4 MACHINARY/ COMPONENTS 8.10 7.86

5 COPPER AND ARTICLES THEREOF 3.50 5.32

6 ARTICLES OF IRON AND STEEL 5.35 4.81

7 VEHICLES OTHER THAN RAILWAY, ROLLING STOCK 2.22 3.55

8 ALUMINIUM AND ARTICLE THEREOF 1.78 1.94

9 IRON AND STEEL 2.95 1.74

10 FURNITURE,BEDDING,MATTRESSES,LAMPS AND LIGHT 0.20 0.49

FITTINGS,ILLUMINATED NAME-PLATES,PREFABRICATED BUILDINGS

(Based on Cumulative Figures July 2017-18)

(​Source:- A Presentation of EDB, Ministry of Industries)

Custom Duty for Electrical Goods in Pakistan

The Customs or ​Import duty​ for Electric appliances to Pakistan is classified under Home &
Garden, Furniture (cdf categories).
The HSCODE applied for Electric appliances is 84-13-81-90-0
The ​tax​ is applied on the total sum of item cost, insurance cost and shipment cost.
The custom/import taxes are:
General duty is 20%
The average VAT rate applicable in Pakistan is 0.17
Note: If the special ​tariff​ rate is NULL then general duty is applicable.
The other taxes applicable are:
Excise duty
Import regulatory duty
To know more information on which tariff rate is applicable from the country you are importing
to, ​look here
To get the accurate amount, ​calculate here
Calculation method:

Customs Duties or ​Import duty​ and taxes will be pending and need to be cleared while
importing goods into whether by a private individual or a commercial entity.
The valuation method is ​CIF.
Below table provide the Duty and ​Sales tax​ for Pakistan :

Average Threshold on
Duty Rates Sales Tax(GST)
Duty Rate goods

0% to 100% (Some ST=17%

No threshold
electronic goods are duty 20.67% VAT = ST * (CIF +
for imports
free) Duty+ other taxes)

● Excise duty is applicable on some goods such as alcohol and tobacco products. ad
valorem will be applied and calculated on the (CIF + Duty) or charged per unit of
measure.
● Import regulatory duty is applied at rate between 5% and 50% some specific products)
calculated on the CIF value.

As part of budgetary measures for the year 2007-08, Special FED at 1% has been levied on
goods which are manufactured or are imported in. This duty is in addition to FED as prescribed
in First​ ​Schedule of the Federal Excise Act, 2005. For list of goods excluded from purview of
this special duty and other details see SRO 655(I)/2007. ​(​Source:- 

customsdutyfree.com)