EVs 30% target by 2030 ambitious but daunting, say automakers

Local auto industry has termed the government's target of having at least 30% electric vehicles (EVs) by 2030 both ambitious and daunting for a financially constrained country like Pakistan.

The industry also mentions that when India could not do it in 10 years despite significant financial interventions, how can Pakistan realise this in the next five years?

Jamil Asghar, who has been associated with the motorcycle industry for around 35 years, said that India introduced FAME I (Faster Adoption and Manufacturing of Electric Vehicles) scheme in 2015 with an initial outlay of INR895 crore (INR8.95 billion), followed it up with FAME II in 2019 with an outlay of INR10,000 crore (INR100 billion).

Then after the end of FAME II in March 2024 came Electric Mobility Promotion Scheme from April till September 2024, with INR500 crore (INR5 billion) and more recently the FAME scheme has been replaced with PM-EDRIVE (PM Electric Drive Revolution in Innovative Vehicle Enhancement) with effect from October 2024 with a total outlay of INR10,900 crore (INR109 billion).

Despite spending billions of rupees, the results, however, are not that promising so far. In October 2024, the sale of two-wheelers in India was recorded at 2.1 million. Of these, only 80,850 units were electric bikes. This translates into penetration of only 3.7% for E2Ws (electric two-wheelers).

During the same period, E4Ws (electric four-wheelers) constituted only 1.5% of total market as per the Federation of Automobile Dealers Association and the Society of Manufacturers of Electric Vehicles in India.

In Pakistan, according to Jamil, there is an industry-wide excitement that automakers are flexing their muscles with the introduction of New Energy Vehicles (NEVs) as the industry is going through a transition phase with the induction of new entrants.

"Unlike ICE (internal combustion engine) vehicles, where localisation is more than 95% for two-wheelers and around 65% for four-wheelers, the NEVs are typically being imported into Pakistan as completely knocked down (CKD) units at best and being assembled here only," he said, adding that prices of these vehicles run into tens of millions of rupees, rendering them very expensive for an average Pakistani customer.

"Moreover, globally, wherever NEV uptake was recorded, it has come as a result of a hefty supply and demand-side incentives and subsidies and it immediately dips when the incentives are removed or suspended," he pointed out.

Jamil said that considering exorbitant prices of NEVs and in the absence of any significant incentives from the government, which is already financially strained and resource starved, what possible fraction of masses will opt for these fancy vehicles remains to be seen. He feared that the government will direct and allocate already scarce resources for a fraction of society and to a sector whose contribution to air pollution is still unclear.