The Economic Coordination Committee (ECC), chaired by Finance Minister Muhammad Aurangzeb, has approved stricter regulations for vehicle imports while granting a conditional increase in profit margins for petroleum dealers.
Under the revised framework, Pakistanis will now be able to import vehicles only through the Transfer of Residence and Gift schemes, effectively ending the long-standing Personal Baggage scheme. Previously, the baggage scheme allowed citizens returning after 180 days abroad to bring cars with fewer restrictions.
The ECC also extended the mandatory stay abroad requirement from two years to three years and imposed a one-year restriction on the sale or transfer of imported vehicles.
Additionally, all vehicles imported under these schemes must meet the same safety and environmental standards applied to commercial imports. The cumulative stay abroad required to benefit from these schemes has also risen from 700 days to 850 days. Vehicles brought as gifts must now come from the country of residence of the sender.
These moves follow an agreement with the International Monetary Fund (IMF), reached during earlier loan negotiations, to curb misuse of import policies. While the Gift scheme remains intact, the Personal Baggage scheme has been abolished. However, the new rules will only take effect once a Statutory Regulatory Order (SRO) is issued by the government.
Apart from vehicle import regulations, the ECC approved measures to manage Pakistan’s ongoing fiscal challenges. The Power Division was allowed to add Rs522 billion to the flow of circular debt under the newly approved Circular Debt Management Plan 2025-26. Taxpayers’ money will be used to offset this addition, keeping the overall circular debt at last year’s level.
The committee also approved Rs2.5 billion to cover pensions and medical expenses for Pakistan International Airlines (PIA) employees, on top of Rs31.7 billion already budgeted to pay interest on the airline’s legacy loans. These decisions highlight that the power sector and national airline continue to face financial stress despite repeated official assurances of improvement.
The new restrictions are expected to curb vehicle imports and help local manufacturers, but they could also limit competition, potentially slowing the availability of higher-quality vehicles at competitive prices.
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