Pakistan is set to liberalize its used car import policy, permitting the entry of vehicles up to five years old until June 30, 2026, after which the age limit will be lifted entirely. The government also plans to progressively eliminate the 40% regulatory duty on these imports by the fiscal year 2029-30, reducing it by 10% annually.

The Economic Coordination Committee (ECC) of the Ministry of Finance ratified this decision, bringing the nation’s regulations in line with commitments to the International Monetary Fund (IMF), which has been advocating for trade liberalization. Imported vehicles will still be required to adhere to established safety and environmental guidelines.

While this decision opens the market to more affordable vehicles, domestic automakers and parts suppliers have voiced apprehension. They fear that the influx of pre-owned automobiles could severely damage local manufacturing, which is already facing difficulties.

Vehicle production has seen a substantial decrease, falling from 226,433 units in the fiscal year 2022 to 111,402 units in FY 2025. Prior to this policy change, used car imports were largely limited and typically entered the country through baggage, gift, or transfer-of-residence programs.