Pakistan’s completely knocked down (CKD) imports have surged to their highest level since March 2022.
According to Topline Securities, the sharp rise in CKD imports reflects improving activity among local car assemblers as demand for vehicles rebounds across the country.
CKD kits are imported sets of vehicle parts used by local assemblers to manufacture cars domestically. Higher imports of these kits generally indicate stronger production activity and rising vehicle sales in Pakistan.
The auto sector had faced severe pressure during 2023 and early 2024 due to import restrictions, currency depreciation, high interest rates, and weak consumer purchasing power.
Several automakers had reduced production or temporarily shut down plants because of difficulties in opening letters of credit (LCs) and obtaining imported components.
However, conditions have gradually improved over the past year as economic stability returned and restrictions on imports eased.
The sharp increase in CKD imports is also contributing to Pakistan’s rising import bill. Continued growth in imports could put additional pressure on the country’s current account if export growth does not keep pace.
