Since the 1950s, Pakistan’s industrial landscape appeared promising, with a focus on establishing a robust manufacturing sector, where the automobile industry played a key role. Ghandhara Motors was assembling and progressively manufacturing General Motors’ Vauxhall cars and Bedford trucks and buses in Karachi and Chittagong.
Since the 1950s, Pakistan’s industrial landscape appeared promising, with a focus on establishing a robust manufacturing sector, where the automobile industry played a key role. Ghandhara Motors was assembling and progressively manufacturing General Motors’ Vauxhall cars and Bedford trucks and buses in Karachi and Chittagong.
Haroon Industries assembled Dodge vehicles in Karachi, while Ali Autos and Wazir Ali Engineering assembled Ford passenger and commercial vehicles, along with Lambretta scooters. The Pakistan Army developed the indigenous Nishan jeep, and Jeep CJ-5 was assembled by Kandawala Industries.
In 1963, Hyesons introduced locally assembled Mack trucks, and in 1964, Rana Tractors set up a parts manufacturing and assembly plant for Massey Ferguson tractors in Lahore. BECO, based in Lahore, had advanced plans to produce Skoda cars through a joint venture. However, in 1972, these industrial units were nationalised, bringing the automobile industry to a near standstill.
In the 1980s and 1990s, the automobile sector re-emerged as a significant player in the nation’s industrial landscape. Renamed manufacturers and assemblers made notable progress, producing vehicles like Suzuki Mehran and Khyber cars, Ravi pickups, Bolan mini MPVs, and Suzuki motorcycles by Sindh Engineering, along with Bedford trucks by National Motors.
One notable project launched in 1991 was the Yasoob truck, a local initiative to produce military-grade vehicles, marking a period of revival for indigenous manufacturing. Companies like Winmark International, which designed and produced Pakistan’s first indigenous car and pickup, the Proficient, in the late 1980s, and Adam Motors, which produced the indigenous Revo car in 2005, contributed to local vehicle production.
Fast forward to today, however, Pakistan’s automobile sector primarily involves assembling foreign brands such as Japanese, Chinese, and Korean vehicles. This shift from manufacturing to assembly raises critical questions: What went wrong? Several factors contributed to the decline of indigenous manufacturing. Frequent changes in government policies have been a major obstacle to long-term industrial growth.
The automobile sector, in particular, requires stable policies to foster innovation and investment, but inconsistent government incentives and planning eroded local manufacturers' confidence. There has been no significant technology transfer, and local facilities are mostly limited to stamping, welding, painting, and assembly operations. Although a large number of parts and components are supplied by local vendors, these are generally low-value and non-critical items.
Another reason for the stagnation of indigenous projects like local cars and pickups is the lack of investment in research and development (R&D). Indigenous manufacturing thrives on continuous innovation, but Pakistan has lagged in this area. Without dedicated R&D, the automobile sector could not keep pace with global advancements. Manufacturing at scale also requires reliable infrastructure, including a stable power supply, efficient logistics, and high-quality raw materials. The deterioration of Pakistan’s industrial infrastructure has made it difficult for local manufacturers to compete with established global brands, leading to a preference for vehicle assembly over full-scale manufacturing.
Over the years, the government has shifted its focus from indigenous anufacturing to attracting foreign direct investment (FDI) by offering incentives to international automobile companies. While this has created jobs in assembly lines, it has sidelined efforts to boost local production capabilities
The arrival of international automotive giants from Japan and South Korea provided consumers with high-quality, technologically advanced vehicles. While this benefited consumers, it dealt a significant blow to local manufacturers, who could not compete with the economies of scale and advanced R&D of global companies. Notable indigenous ventures like Revo, which produced about 600 cars that operated successfully as taxis in Karachi, had to cease production due to a lack of government support.
Similarly, Winmark International produced only limited numbers of Proficient cars and pickups before its production was halted in the 1990s due to governmental restrictions on large-scale production. The Yasoob truck project, which assembled around 300 off-road vehicles for the military until 1997, was discontinued due to cost overruns, malpractices, and mismanagement.
Over the years, the government has shifted its focus from indigenous manufacturing to attracting foreign direct investment (FDI) by offering incentives to international automobile companies. While this has created jobs in assembly lines, it has sidelined efforts to boost local production capabilities.
Pakistan’s current reliance on assembling foreign brands has significant economic implications. Assembly operations create limited job opportunities and contribute less to skill development and technological expertise compared to full-scale manufacturing. Additionally, the high volume of imported components leads to a considerable outflow of foreign exchange, weakening the economy.
Reviving indigenous manufacturing is not just a matter of industrial pride -- it is an economic necessity. For Pakistan to reclaim its place as a producer of automobiles, the following steps are necessary. First, the government must introduce and adhere to long-term industrial policies that support local manufacturers through tax incentives, R&D subsidies, and protection from foreign competition.
Public-private partnerships can drive innovation, with the government funding initiatives to improve local manufacturing technologies while collaborating closely with the private sector. Policies should also incentivise the establishment of plants for progressive manufacturing, not just assembly lines, to foster technology transfer and skill development among the local workforce. Moreover, a focus on improving industrial infrastructure, including roads, power supply, and skilled labour, is crucial for developing a competitive manufacturing sector.
To develop a more competitive automotive industry, Pakistan could learn from both its peers and larger neighbours in Asia. Countries like Vietnam, Indonesia, and India provide valuable insights into how strategic policies, R&D investments, and international partnerships can lead to success in the automotive sector. While Pakistan's economic size and industrial development differ from these nations, their experiences show how stable industrial policies and integration into global supply chains can drive progress.
Pakistan’s political instability, inconsistent industrial policies, and less favourable environment for domestic investment have hindered its progress. Comparisons with nations like Malaysia, Thailand, Iran, and Bangladesh highlight the importance of government support, long-term vision, and consistent policies in building successful automobile industries. Notably, Ghandhara Motors in Chittagong (then part of Pakistan) was renamed Pragoti Industries Ltd after nationalisation in the 1970s. Today, it successfully operates as a state-run company in Bangladesh, assembling vehicles and manufacturing auto parts, producing around 50,000 units of cars, buses, trucks, and pickups annually.
If Pakistan is to revive its indigenous manufacturing sector, it must learn from the mistakes of the past. A renewed focus on transparency, accountability, and long-term planning is essential. Furthermore, the government must create an environment where local manufacturers are encouraged to innovate and invest in R&D. Only by addressing these foundational issues can Pakistan hope to reclaim its potential as a producer, not just an assembler, of vehicles.
The writer is a retired chairman of the State Engineering Corporation and former member (PT) of the Pakistan Nuclear Regulatory Authority.
