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Volkswagen to invest $135 million to set up an auto plant in Pakistan

German automaker Volkswagen has planned to invest $135 million to set up a plant for manufacturing and assembling of vehicles in Pakistan, in collaboration with a local partner.

The Ministry of Industries and Production official revealed that the ‘category-A Greenfield investment status’ was granted to a Karachi-based Premier Motor Limited for manufacturing and assembling of vehicles under its contract agreement with the Volkswagen.

The auto plant will be set up in Balochistan and for this purpose land has been acquired already. As the Greenfield investment status has been awarded by the government, the company would now start the construction on the site. By 2021 the plant would become operational and would initially manufacture vans and double cabin vehicles.

In March 2016, the government launched the five-year automobile development policy 2016/21 to attract investment in the automotive industry. For this, at least 15 companies have expressed interest to avail the benefits of the policy by manufacturing trucks, cars and sport utility vehicles.

Out of these, 13 companies have been given the Greenfield status as they come up with new investment with new technology and products

On the other hand, two companies have been given the Brownfield status as they want to expand their existing plants.

Auto companies from France, Germany, Korea, Japan, China and UAE are also planning to invest in Pakistan.

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