Pakistan's auto sector hits out at PTI govt's EV policy

Says stakeholders’ consent was not sought before approval of policy

LAHORE: The approval of Pakistan’s first electric vehicle policy by the cabinet has come in for criticism from the domestic automobile industry.

Almost all auto-sector stakeholders have termed the approval of the policy an “ad hoc decision”. They were in favour of introducing electric cars in Pakistan, but not at the cost of domestic industry. “We are unable to understand who has drafted and approved such a policy,” remarked an official of a Japanese car manufacturer while talking to The Express Tribune. “The approval came as a shock to domestic automobile players whose consent was not sought by government officials on this key issue.”

The federal cabinet approved the electric vehicle policy on Tuesday under which 100,000 cars would be imported over a period of five years. The government earlier shared the vision to convert at least 30% of vehicles into electricity-powered by 2030 and aimed to achieve the target by charging only 1% general sales tax on the import of electric vehicles.

Moreover, registration of such vehicles will be free of cost, which will make them affordable for a large number of people.

“We were informed by government authorities that an electric vehicle policy was under consideration and stakeholders would be consulted before its finalisation,” said Hyundai Nishat Motor Chief Financial Officer Norez Abdullah while talking to The Express Tribune.

He added that the company was a new entrant into the Pakistan market and had invested heavily under the Automotive Industry Development Policy 2016-21.

“Until yet, we have not collected even a single rupee out of our investments,” he said. “The overall scenario of the local automobile industry is not encouraging and the government has introduced a new policy.”

Stakeholders were of the view that these kinds of ad hoc decisions would result in excessive accumulation of external debt and would shift jobs from Pakistan to other countries.

“There are many loopholes in this policy; we are unaware of the investment required to build electric vehicle-friendly infrastructure in order to save around $2 billion in oil imports,” Abdullah said. On the other hand, the auto parts manufacturers also reacted to the sudden announcement of the electric vehicle policy.

Pakistan Association of Automotive Parts and Accessories Manufacturers (Paapam) Chairman Muhammad Akram said with an active auto development policy in place, the new electric vehicle policy would only create confusion.

Earlier, Adviser to Prime Minister on Climate Change Malik Amin Aslam held a meeting with Indus Motor CEO Ali Asghar Jamali and promised to take all stakeholders on board prior to approval of the policy.

Published in The Express Tribune, November 7^th, 2019.

Like Business on Facebook, follow @TribuneBiz on Twitter to stay informed and join in the conversation.