ISLAMABAD, June 22: The government has shelved a project for duty- and tax-free import of 300 purpose-built taxis as it did not get even a single offer by the June 21 deadline and the sponsors of the British Black Cabs put on hold their investment plans.

“We did not receive any application by the deadline. So, the facility of duty-free-import (of 300 cabs) will no more be available to anybody,” Minister for Industries and Production Jehangir Khan Tarin told Dawn on Thursday.

Asked about the future of Prime Transport Limited’s project for import and manufacture of Black Cabs, the minister said the question was better directed at the investor. “We had offered a facility but perhaps nobody is interested,” he added.

Mr Tarin said the government would welcome any investment project or a plant for car manufacturing but the duty-free import of taxis would not be part of any such plan.

The ministry of industries had floated a tender on June 7, seeking offers within 15 days for the duty-free import of 300 purpose-built cabs and subsequent setting up of an assembly/manufacturing plant at five per cent duty on CKD and 20 per cent on CBU condition.

Interestingly, the government had already allocated 400 acres of land in Karachi in addition to large plots for taxi stands at all domestic and international airports to Prime Transport Limited (PTL) even before it advertised import of zero-rated cabs and setting up of a related manufacturing plant, claimed PTL.

In a related development, PTL chief Dawood Khan told Dawn on Wednesday that his “company is seriously reconsidering the whole project but we have already made an expenditure of three to four million dollars and that is keeping us tied up”.

PTL’s foreign partner, LTI Vehicles of UK, has, on the other hand, confirmed that its “Black Cab is the only purpose-built taxi in the world” and it has not authorised any company other than the PTL to import or assemble/manufacture the vehicle in Pakistan.

In a letter to the ministry of privatisation and investment on May 31, the company threatened to “contest unauthorised import/assembly of manufacture of Black Cab by any company other than PTL”.

Mr Dawood Khan said his project involved a total investment of $850 million, including 45 per cent equity put together by the LTI of UK and a number of other PTL shareholders, mostly his family members. The remaining 55 per cent funding comes from foreign banks.

He agreed that the government messed up the whole affair but declined to comment on the tender process or on why he did not formally respond to the tender. About his company’s financial strength, he said his family had franchise food chains in the US but declined to give further details.

A senior government official said it was not yet clear if the facility of reduced duty of five per cent on completely knocked down (CKD) and 20 per cent on CBU condition would still be available to the assembly/manufacturing plant as nobody availed himself of the duty free-import facility. He said the matter would have to be referred back to the Economic Coordination Committee (ECC) of the cabinet for guidance on certain issues.

The PTL claims on its website that it has already been allowed duty and tax free import of 300 CBUs of black cabs from the UK and then manufacturing of 6000 cabs per annum at a specifically created industrial zone at Dhabeji, about 19 kilometres from Port Qasim, Karachi. “The Land Utilisation Department accordingly issued Provisional Allotment letter to Prime Transport Limited”.

The PTL website claims that on the directives of the President of Pakistan, Corps Commander Lahore Shafatullah Shah has also provided a spacious piece of land in the Defence Officers Housing Authority, Lahore, and agreed to ban all other cabs and rickshaws in all areas of the DHA once the Black Cabs started operations.

The company, with the support of the president and the prime minister of Pakistan, took almost a year to make all arrangements including land acquisition and registration etc and agreement with the foreign principal that other investors were asked to complete in 15 days. As might have been predicted, nobody responded.

The PTL, owned by US citizens Sami Khan and Dawood Khan, also plans franchise transport arrangements in major cities of the country, according to PTL website.

Referring to a story in this newspaper on June 13, where certain aspects of the tender were brought into question, the company, in a letter, challenged that import of black cabs was “not procurement by any ministry or department of the government as such it does not fall within the purview of Public Procurement Regulatory Authority” and claimed that “simply private enterprises have been offered to import purpose-built taxis for improving public utility service”. The PTL letter also pointed out an inaccuracy in the Dawn story about where the tender was published. But, it did not address the fact that a level playing field.