The government is proposing a new mechanism to import, refurbish, and re export used vehicles. The draft auto policy for 2026 to 2031 aims to boost exports and attract investment into the automotive sector. Consequently, Pakistan to allow export of refurbished used cars through an import refurbishment export framework. The model is based on Dubai’s Jebel Ali system. Licensed companies can bring used vehicles into Pakistan, refurbish them locally, and ship them to overseas markets. The vehicles will not enter the domestic market.

The plan has gained momentum after the Gulf war. The Special Investment Facilitation Council strongly backs this scheme. It sees the scheme as a potential source of multi million dollar export revenues. Therefore, Pakistan to allow export of refurbished used cars at a time when the country struggles to raise outbound shipments. The policy is currently under discussion with the International Monetary Fund. Officials will place it before the federal cabinet after completing those consultations.

Under the draft policy, operators would receive duty suspension incentives through the Export Facilitation Scheme. This move encourages investment in specialized refurbishment facilities. It also integrates Pakistan into the global automotive value chain. Only registered companies can operate under this framework. Eligible firms must incorporate under the Companies Act and demonstrate sufficient financial and technical capacity. They need a business plan for refurbishment and exports. Companies must also secure approval from relevant ministries as a sectoral export project.

Vehicles imported under the scheme must re export within nine months of arrival. Limited extensions may apply in exceptional cases against valid justification and additional financial security. Failure to re export within the prescribed period will trigger action by the Federal Board of Revenue.