The foreign exchange allocated for vehicle imports will be decided based on the foreign exchange reserves the Government will have by February next year, according to a senior official from the Ministry of Finance who wished to remain anonymous.
The official stated that the phased approach of opening up vehicle import restrictions reflected the Government’s cautious balancing of economic recovery and foreign exchange management, with Phases II and III contingent on reserve levels and economic conditions.
The official declined to provide further details, stating that official decisions would be duly published.
Nevertheless, Deputy Minister of Transport and Highways Prasanna Gunasena said that Phase I – comprising the import of buses – had already commenced and that by February 2025, Phase II, the import of personal use vehicles, would recommence.
“The Government has begun easing the temporary suspension on motor vehicle imports, which was implemented in 2020 to safeguard foreign reserves during the Covid-19 pandemic and economic downturn,” he said.
Gunasena also pointed out that the phased approach, regulations, and timeline for opening up the restrictions had been decided by the Ministry of Finance.
Phase I of the relaxation, approved on 13 September, permits the import of buses, special-purpose vehicles, and non-motorised wheeled items under 52 combined classification codes.
This move follows economic recovery and stabilisation of foreign reserves, with regulations detailed in Gazette Notification No.2415/35 released on Wednesday (18).
Strict conditions have been imposed to manage imports.
Imported vehicles must be registered with the Department of Motor Traffic (DMT) within 90 days of the Customs declaration, with penalties for non-compliance.
Vehicles intended for sale cannot be registered under the name of the importers and must be sold to end users.
Importers who fail to register more than 25% of their vehicles within the stipulated time frame of six months will face a 36-month import ban, a press release by the Ministry of Finance, Planning, and Economic Development noted.
Additionally, vehicles imported in violation of regulations must be re-exported within 90 days at the importer’s expense. Only new and unused vehicles are allowed and vehicle age will be calculated from the manufacture date to the bill of lading.
“These measures aim to prevent excessive vehicle imports that could strain foreign reserves and lead to stockpiling,” Gunasena said.