The market is currently flooded with smuggled tires across various sizes, a stark contrast to the slowdown observed last year following government crackdown efforts.
Despite their subpar quality, many consumers pick for smuggled tires due to their affordability, often unaware of the potential consequences.
Of the 14.5 million tires sold annually in Pakistan, approximately 25 percent are produced domestically, 10 percent are legally imported, with the remaining majority sourced through smuggling.
The decrease in tire imports last year, attributed to the depreciation of the local currency against the US dollar, has resulted in a surge of smuggled tires to meet the demand.
The severity of the issue is highlighted by the seizure of over 55,000 smuggled tires, primarily larger car sizes, valued at Rs 540 million by the Collectorate of Customs Enforcement (CCE) in Karachi last year.
Manufacturers and the business community are urging the government to implement effective measures to combat tire smuggling, aiming to enhance the competitiveness of the local industry and create fair business opportunities for legal importers.
CEO GTR Hussain Kuli Khan said that “Local industry is the back bone of any economy. It is the primary responsibility of the government to provide protection. Local industry create employment opportunities, pay taxes to national exchequer and save forex for the country.”
He said that smuggling of tyres was damaging local industry and costing the national exchequer more than Rs 70 billion annually.
He mentioned that the smuggled tyres arrive in substandard conditions, exhibiting torn tyre beads and structure that too along with tampered dates.
Subsequently, the smugglers employ mechanical tools to rectify the deformed tyres, significantly diminishing their operational lifespan and posing a considerable risk to public safety.
Additionally, forged documents are circulated to make these tyres appear identical as per the import GDs of other imported consignments.
Hussain said that “The government should re-evaluate the data of the items being imported via the Afghan Transit Trade (ATT) and see if the numbers of tyres being imported are supported by the vehicle population in Afghanistan. Items under the guise of ATT are either unloaded in Karachi or come back from the Afghan border via smuggling and this need to be addressed.”
