Islamabad, Dec 23: IFC, in collaboration with a consortium of local banks including HBL, Meezan Bank, Bank Alfalah, and Habib Metropolitan Bank, is providing financing of up to $50.2 million to Armstrong ZE Pvt. Ltd. for establishing a greenfield tyre manufacturing facility in Gharo, Sindh. The initiative aims to boost local tyre production, reduce import reliance, and foster economic growth through job creation and technological advancements.
The financing package includes a $25 million loan from IFC and up to $25.2 million equivalent investment in Pakistani rupees from the local banking consortium. This landmark project is projected to create over 1,800 direct and indirect jobs while strengthening Pakistan’s automotive supply chain with a locally manufactured international tyre brand.
With the number of registered vehicles in Pakistan reaching approximately 30 million in 2023, including 23 million two-wheelers, the demand for tyres has steadily increased. However, local production faces challenges such as limited technical expertise, reliance on imports, and a significant informal market. By reducing tyre imports, the project will support Pakistan’s foreign currency reserves and enhance sector competitiveness through the introduction of advanced technology and expertise.
Azim Yusufzai, Chairman of Armstrong ZE, expressed pride in the collaboration: “This investment is not just financial support but a testament to the trust and confidence placed in our vision and capabilities. Together with IFC and our banking partners, we aim to innovate, create jobs, and deliver sustainable tyre solutions to Pakistan, contributing to the nation’s economic and industrial development.”
IFC’s Regional Director for the Middle East, Pakistan, and Afghanistan, Khawaja Aftab Ahmed, emphasized the investment’s importance: “This project underscores IFC’s commitment to enhancing Pakistan’s manufacturing capacity. By supporting Armstrong ZE, we aim to improve consumer access to quality tyres, spur economic growth, and reduce reliance on imports, fostering a self-sustaining automotive industry.”
The project will benefit from Armstrong’s association with the UAE-based Zafco Group Holding, a global leader in tyre, battery, and lubricant distribution in over 85 countries. Additionally, the expertise of Zafar Enterprises, a prominent tyre distributor in Pakistan, will be leveraged to ensure the project’s success.
IFC will further support Armstrong ZE through its Responsible Investing Support in Emerging Economies (RISE) advisory program, focusing on climate risk management, resource efficiency, and strengthening environmental and social governance processes.
This initiative aligns with IFC’s broader efforts in Pakistan, where it has invested approximately $13 billion since 1956 across sectors like renewable energy, infrastructure, manufacturing, and trade. The Armstrong ZE project represents a significant step toward sustainable industrial growth and innovation in Pakistan.
