Manufacture of Construction Equipment

1
Manufacture of Construction Equipment Machinery

• Introduction
• Need Assessment
• Proposed Project
• Financial Evaluation

2
Construction Equipment MachineryIntroduction

• Long history of indecision and failure
• Initiated in early 1960s
• Transferred to PIDC in mid 1960s
• Transferred to HMC in mid 1980s
• No action to-date
• All construction machinery is still imported

3
Construction Equipment MachineryNeed Assessment

• Construction machinery is vital for accelerating
  development
• The present population of crawler bulldozers in
  Pakistan is estimated at around 3000
• Pakistan is importing about 100 machines per year
  on the average at a total foreign exchange
  expenditure of approximately Rs. 300 million
• Import figures do not reflect actual demand which
  is in fact suppressed
• Since large amount of public money has already
  been either ear-marked or disbursed for
  contruction activity, the need for construction
  equipment and machinery is bound to only increase

4
Construction Equipment MachineryProposed
Project

• The objective of the Project is to produce
  Construction equipment and machinery locally
• The project is proposed to be located at Taxila,
  Lahore or Karachi
• Initially an assembly plant may be set up and
  components purchased from local vendors such as
  HMC, DESCON, Karachi Shipyard etc
• Initially the unit may produce only 75HP and
  150HP bulldozers, loaders, excavators, etc. may
  be added.

5
Construction Equipment MachineryFinancial
Evaluation

• Investment - Rs. 500 million including the cost
  of transfer of technology, licensing fees etc. of
  the OEM
• IRR - 18