ISLAMABAD:
The Ministry of National Food Security and Research has recommended immediate focus on setting up a completely knocked down (CKD) manufacturing plant for high horsepower (HP) tractors in Pakistan alongside small to medium-power-range units, with government backing for policy matters, financing, regulatory affairs and vendor development to ensure a successful establishment of the facility.
The food security ministry has conducted a study on the demand for high HP tractors in the country. For the study titled “100+ HP Tractors Demand and Supply Assessment”, consultant AT Kearney was engaged through the Public Private Partnership Authority (P3A).
In a meeting held on July 2, 2025 under the chairmanship of Special Investment Facilitation Council (SIFC) director general, it had been decided that although the study was being conducted by the food security ministry, the Ministry of Industries and Production would move a summary comprising its recommendations to the prime minister to seek guidance on the way forward.
The study was forwarded by the food ministry to the SIFC, the Ministry of Industries and other stakeholders on July 31, 2025 with key findings and recommendations.
According to the report, the upper-bound market potential for high HP tractors is around 2,800 units over a period of five years. It reveals that the realisable and sustainable annual demand for high HP tractors may vary from 100 to a few hundred units.
On the demand side, the study points out the barriers to adoption of such tractors including high purchase costs, fragmented and small landholdings, limited access to credit, the lack of compatible heavy-duty implements and a persistent gap in after-sales service.
On the supply side, a practical feasibility study remains hampered by vendor development bottlenecks, import dependency for core components, insufficient government incentives and uncompetitive cost structures. “Pakistan’s high HP tractor market should be regarded as a strategic niche with medium to long-term growth potential, not as an immediate mass-market opportunity.”
On August 4, 2025, the Ministry of Industries requested the Ministry of Food Security, Green Corporate Initiative (GCI) and Margla Heavy Industries/Heavy Industries Taxila to provide specific views on the study.
The food ministry recommended immediate focus on establishing a local CKD manufacturing plant for high HP tractors together with small to medium-power-range tractors. It also asked for government’s support for policy matters, regulatory affairs, financing and vendor development to help establish the plant.
GCI supported the involvement of the private sector in manufacturing high HP tractors in a phased programme – from completely built unit (CBU) to semi-knocked down (SKD) and to completely knocked down CKD – including a deletion plan with a supportive policy environment from the government.
Margla Heavy Industries, while highlighting various challenges such as limited annual demand, high costs of tractors and compatible implements, reliance on imported components and the lack of after-sales service, supported a collaborative strategy with the private sector in a phased programme (CBU to SKD to CKD) including a deletion plan.
On November 25, 2024, GCI had signed a memorandum of understanding (MoU) with Belarus Minsk Tractor Works for setting up a high HP (more than 100) Belarus tractor assembly line in Pakistan. The MoU stipulated that in the first phase, a joint feasibility study would be conducted to assess the need and make a technical and financial evaluation of the project.
The SIFC spearheaded the project. During a meeting held on January 17, 2025 and headed by the SIFC director general, it was agreed that the Ministry of Food Security would initiate a comprehensive feasibility study through a credible firm and complete it by April 14, 2025.