Pakistan paid USD 1.2 billion for imported cars in 6 months despite a total collapse of its finances

Pakistan is facing one of its worst economic crises ever, but that hasn't stopped the car enthusiasts in the country to import high-end vehicles from around the world. According to a report, Pakistan spent USD 1.2 billion (Rs 259 billion) on the import of transportation items, including luxury cars, high-end electric vehicles, and their parts, during the last six months.

Pakistan's The News reported that despite the overall reduction in imports of transportation vehicles and other items compared with last year, the economy was still burdened with heavy outflows for buying expensive luxury vehicles and useless items.

The costly imports: During the last six months, the country imported completely built units (CBU), completely knocked down/semi knocked down (CKD/SKD) of USD 530.5 million equivalent to Rs 118.2 billion.

• Under the CKD/SKD, imports of buses, trucks, and other heavy vehicles imports were USD 722.5 million (Rs 161 billion), while motor car imports were recorded at USD 498 million (Rs 111 billion). Motorcycle imports also stood at USD 27.6 million, reported The News.
• The parts and accessories imports stood at USD 188.6 million (Rs 42 billion). Similarly, USD 47.7 million were spent on the import of aircraft, ships, and boats.

Over USD 140 billion imports in just December: In December, the transport sector's imports stood at USD 140.7 million (Rs 31.6 billion). Of this, USD 47.5 million or 11.3 billion rupees were spent on the imports of cars, USD 27 million on parts and accessories, USD 3.6 million on motorcycles import, USD 25 million on buses, trucks, and heavy vehicles, and another USD 22.4 million on the import of aircraft, ships, and boats, reported PTI.

• Reportedly, despite economic crises, the incumbent government has lifted a ban on the import of luxury cars recently, which became one of the major sources of dollar outflow, reported The News.

Pakistan's economic crisis: Pakistan is facing an alarming financial crisis and it has severely affected millions of people. The cash-strapped country is running out of food reserves and the foreign reserves have depleted to as low as USD 4 billion.

• The government is even resorting to drastic measures like ordering shopping malls, restaurants, wedding halls, and markets to shut down early, and auctioning a Pakistani embassy property in the US.
• Mounting debt and rapidly dwindling forex reserves in the wake of higher global inflation had already weakened Pakistan's economy and a devastating flood further worsened the situation in Pakistan. The flood, which affected nearly 33 million people, is believed to have led to damages worth over $30 billion, reported India Today.