Electric vehicle industry under the spotlight in Pakistan
In a bid to fight against the challenges imposed by the rising air pollution due to the carbon emissions from the combustion engines, the government is finalizing an EV policy to that would determine the future of the electric vehicles in Pakistan.
Recently, the Ministry of Climate Change presented a proposal of electric vehicle policy, which was highly opposed by the local automobile industry. It involves the import of entirely built units (CBU) of electric vehicles in the country which, the domestic sector calls against the auto development policy (ADP) 2016-21. The localization will be profoundly affected due to the import of CBU units of these vehicles. Although 70% of the components of the electric cars excluding the batteries and electric motors could be produced locally yet the government is formulating a policy that offers a reduction in the customs duties on the CBU and CKD units of electric vehicles. By 2030, the government aims to achieve a 30% market share in the sales of electric vehicles. It is also believed that the government is in talks with several stakeholders for the preparation and finalization of the national electric vehicle policy. On the other hand, the world is moving towards the production of electric vehicles and even exporting them to the other parts of the globe.
The adverse effects of air pollution are evident as the environment continues to deteriorate significantly. The carbon emissions from combustion engines play a vital role in polluting the atmosphere. Electric vehicles are more than just a perfect alternative for reducing air pollution. Turning to electric cars would also reduce the usage of petrol and diesel as the electricity will take over for the charging of these vehicles. To achieve the desired results and bring practicality to the approach of introducing electric vehicles, there is a dire need to manage the pace of policy development rather than being in haste as it looks at the moment. The EV policy shall be in the interest of the consumer. The consumers in Pakistan have long been deprived of the product quality as they expect the government to formulate a strategic policy in the interest of the consumers in terms of quality, performance, and after-sales services. With the technical development of the electric industry, more employment opportunities are created in the sector on the back of the localization of parts.
On the other hand, the localization is as essential as any other factor benefiting the auto industry. However, it’s also not as straight forward as it seems on the outlook to localize the process with low volumes of production. Without localization, the imports rise, and the auto sector suffers a huge time, thus transferring all the burden of costs on the consumers. At this moment, the government needs to devise a policy to bring competition under a particular set of rules rather than opening the door for every other company to start selling EVs in the country. The focus should be on promoting the electric vehicles in the country and building the infrastructure to bring the whole process under the roof of practicality. The ground realities shall be kept in mind as to not disturb the local auto sector by importing the CBU units of these vehicles.
The government should also look to encourage the scope of electric motorbikes in the country. There is a large proportion of bikes which consume nearly 50% of the overall requirements for petrol. Not to forget, Pakistan is also the fifth largest market of motorbikes in the world. The other four countries on top of the list include China, India, Indonesia, and Vietnam. Therefore, a large amount of consumption of petrol could be reduced by going electric in motorbikes. The existing manufacturers of motorbikes could also be encouraged to enter in this sector.
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