Business

Pakistan’s bike production drops for first time since 2000

Published

2 years ago

Farwa

Stagnant incomes, declining agricultural growth caused slump.
Production dropped by 34% in first five months of FY22-23.
Production of other companies except Honda declined by 73%.

LAHORE: Motorcycle manufacturing and sales have continued their vigorous growth, from around 100,000 bikes in 1999-2000 to 2.6 million in 2021-22, despite recession or boom. However, 2022-23 could be the first fiscal year since 2000, when bike manufacturing will drop steeply.

Does the bike slump indicate Pakistan’s worst recession?

The drop in bike manufacturing and sales may also be due to the steep increase in the price of two-wheelers.

Since bikes are purchased and used by low-income buyers, the sales might have slowed a bit if the prices remained stable, however, at current rates and almost stagnant incomes, people are struggling to make ends meet.

Another reason for the drop might be declining agricultural productivity, as most motorbike sales in the country are accounted for in rural areas. Recent floods that affected over 34 million people are a reason for slumping sales.

Motorcycle production data is from the Pakistan Automotive Manufacturers Association (PAMA), however, many motorbike manufacturers are not registered with it, and the Pakistan Bureau of Statistics (PBS) records their production data.

Most of the local bike manufacturers produce the 70cc variant, barring three Japanese manufacturers. However, there has always been a huge price difference in the retail price of the 70cc Japanese bike and the local or Chinese models.

But, the Japanese brand sales are still almost double the sales of all other brands. Currently, the market leader Japanese 70cc bike costs Rs125,000 while local 70cc variants are available at Rs80,000 to Rs85,000.

However, the statistics for last year are available that put the total motorbike production at 2.6 million.

According to data in 2021-22, the market leader produced 1.35 million motorcycles, and the rest 1.25 million units were sold by all others, including two other Japanese brands. These Japanese brands, however, produced motorbikes of 100cc or above power.

The PAMA statistics for the first five months of the current fiscal year give a true picture of the state of the bike industry in the country.

In the July-November 2022 period, the bike industry (registered with PAMA) produced 521,643 bikes against 797,346 produced during the same period of last year. This is a massive decline of 34% in the first five months of this fiscal.

To get a picture of the turmoil faced by different manufacturers, a further study of the PAMA statistics revealed that Honda produced 563,268 bikes in the first five months of the last fiscal. This year the production has declined to 435,390 a decline of over 22%.

United Auto Motorcycle is the next brand with the highest production. It produced 136,720 units from July-November 2021. This fiscal year during the same five months, the production has dropped to 38,957 bikes. This is a massive decline of over 300%.

Next comes, Road Prince Motorcycle, which produced 52,289 motorcycles in the first five months of the last fiscal. During the same period this fiscal, its production has declined to 14,540 units. This again is a huge decline witnessed in the industry.

Overall the production of all other motorcycle producers except Honda declined by 73%.

This unexpected decline in motorcycle uptake has created turmoil in the industry and thousands of workers have been laid off. Some industry experts attribute the decline in bike production to the restrictions on the import of components imposed by the government.

This may be partially true but we must recognise the fact that the buyers lack the finances to buy two-wheelers at current high rates.

Business

The amount of trade between Saudi Arabia and Pakistan hits $700 million.

Published

10 hours ago

Farwa

Through the Special Investment Facilitation Council (SIFC), Pakistan’s trade connections with Saudi Arabia have grown significantly, with bilateral trade volume rising from $546 million to $700 million and exports to the Kingdom growing by 22%.

As bilateral economic cooperation continues to grow, Saudi investors have shown a strong interest in Pakistan’s construction, energy, agricultural, and information technology sectors. The objective for exporting IT services between the two countries has been raised from $50 million to $100 million.

Saudi Arabia has set up a help desk dedicated to making it easier for Pakistani IT companies to register in the Kingdom in order to expedite commercial procedures. The goal of this program is to speed up economic collaborations between the two countries and lower administrative barriers.

The well-known Saudi restaurant chain AlBaik has revealed plans to open locations in Pakistan, which is a big step for the food service industry and should lead to the creation of new job possibilities in the area.

Officials have noted that stronger business links between the two countries lead to greater economic stability, and the SIFC has played a crucial role in promoting these trade advancements. For bilateral trade and investment projects, the Council remains a crucial facilitator.

According to a trade official with knowledge of the developments, “the establishment of dedicated support mechanisms, such as the help desk for IT companies, demonstrates a commitment to long-term economic partnership,” The goal of these programs is to improve the conditions for commercial collaboration between the two nations.

The increasing amount of trade and the diversity of investment sectors show that Saudi Arabia and Pakistan’s economic ties are changing as both countries seek to deepen their business alliances in a number of industries.

Business

After more than 50 years, Bangladesh and Pakistan resume direct trade.

Published

10 hours ago

Farwa

After more than 50 years, the two governments will resume direct bilateral trade, with Bangladesh’s food ministry announcing Sunday that it will receive a supply of 25,000 tonnes of rice from Pakistan next month.

After former Prime Minister Sheikh Hasina was overthrown last August, relations between Bangladesh and Pakistan have begun to improve after decades of tense relations.

Since then, there have been increased bilateral interactions between Bangladesh and Pakistan. Nobel laureate Muhammad Yunus, the interim government’s senior adviser, has met twice with Pakistani Prime Minister Shehbaz Sharif.

According to the food ministry, Dhaka completed an agreement earlier this month to import grains from Pakistan.

“On March 3, the first shipment of 25,000 tonnes will reach Bangladesh,” Zia Uddin Ahmed, a ministry assistant secretary, told Arab News.

“This is the first time that Bangladesh has started importing rice from Pakistan at the government-to-government level since 1971.”

Following direct maritime contact between the two South Asian countries in November—a Pakistani cargo ship stopped in Bangladesh for the first time since 1971 with imports and exports arranged by private companies—their trade relations grew.

Resuming trade with Pakistan is a significant step for Bangladesh, according to Amena Mohsin, a lecturer at North South University and a specialist in international relations.

“We want to see progress in our bilateral relationship with Pakistan. Most significantly, we are currently going through a low point dispute with India, even though we constantly diversify our partnerships.

This most recent move to purchase rice from Pakistan is really significant in this context,” she told Arab News.

Business

The total amount of Pakistan’s liquid foreign reserves is $15.95 billion.

Published

3 days ago

Farwa

As of February 14, Pakistan’s total liquid foreign reserves were $15,947.9 million, with the State Bank of Pakistan’s (SBP) holdings being $11,201.5 million.

Official figures for the week ending February 14, 2025, show that the central bank’s liquid foreign exchange reserves rose by $35 million to $11,201.5 million.

Commercial banks maintained net foreign reserves of $4,746.4 million during the period under review, according to the breakdown of foreign reserves.

The nation’s total liquid foreign reserves as of the week ending February 07, 2025, were $15,862.6 million.

Of these, the central bank held $11,166.6 million in foreign reserves, while commercial banks kept $4,696 million in net reserves.