Brief Overview of Pakistan's Electric Vehicle Policy

[Riaz Haq]

Pakistan has a low level of motorization with just 9% of the households owning a car. Nearly half of all households own a motorcycle. Motorization rates in the country have tripled over the last decade and a half, resulting in nearly 40% of all emissions coming from vehicles. Concerns about climate change and environmental pollution have forced the government to to take a number of actions ranging from adoption of Euro6 emission standards for new vehicles with internal combustion engines (ICE) since 2015 and announcement of a national electric vehicle (EV) policy this year.

Vehicle Ownership in Pakistan. Source: PBS

EV Policy:

Pakistan electric vehicle policy 2019 sets EV adoption targets and includes incentives for buyers and manufacturers. It also focuses on development of nationwide charging infrastructure to ease adoption of electric vehicles. Here are some of the salient points of the policy:

 Policy Targets: 

1. Goal for cars: 30% of new sales by 2030 and 90% of new sales by 2040

2. Goal for 2 and 3 wheelers: 50% of new sales by 2030 and 90% of new sales by 2040

3. Goal for buses: 50% of new sales by 2030 and 90% of new sales by 2040

4. Goal for trucks: 30% of new sales by 2030 and 90% of new sales by 2040

Buyer Incentives: 

1. 1% GST for EVs vs 17% for regular vehicles

2. Lower electricity tariffs for EVs

Charging Infrastructure: 

1. Only 1% import duty on charging equipment.

2. Lower power tariffs for charging stations.

3. One fast DC charging station per 3km by 3km area in all major cities

4. DC fast chargers on all motorways every 15-30 km.

5. Ensure uninterrupted power on feeders for charging stations.

Manufacturer Incentives: 

1. All greenfield investments apply to EV manufacturers and those converting their existing facilities to manufacture EVs.

2. State Bank to offer lower rate financing for EV manufacturing.

Summary:

Announcement of National Electric Vehicle (EV) Policy 2019 by Pakistan government is a step in the right direction. It is a forward looking step needed to deal with climate concerns from growing transport sector emissions with rapidly rising vehicle ownership. It also focuses on development of nationwide charging infrastructure to ease adoption of electric vehicles.  Meanwhile it's crucial that Euro6 emission standards be seriously enforced with proper inspections to limit emissions from internal combustion engine (ICE) vehicles being sold now.

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[Riaz Haq]

As US-China trade war escalates, could Pakistan be Beijing's EV loophole? - CSMonitor.com


https://www.csmonitor.com/World/Asia-South-Central/2025/0214/China-...


Amid the ornately painted trucks bellowing smoke and the green and yellow tuk-tuks, the Chinese-made Haval Hybrid Electric Vehicle has become a ubiquitous sight on the streets of Islamabad.

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Some are looking to neighboring Pakistan, a country of 240 million which has so far welcomed Chinese automakers, to buoy sales – and possibly bypass (US) tariffs. In recent months, several Chinese automakers have either doubled down on their Pakistan projects or made their first foray into the market.

As EVs become an increasingly important geopolitical battleground, former Pakistan finance minister Miftah Ismail says that, at least in the short-term, Pakistan could serve as a sort of pressure release valve for Beijing. But he predicts the West will eventually catch up.

“The West will say that EV components have to be made in certain countries, or that 70% of the value addition has to be done in the country that exports,” he says. “It's a cat and mouse game. The West will find other ways of placing restrictions on the Chinese.

An alliance on the rocks
In October, Chinese battery giant Build Your Dreams (BYD) formally entered the Pakistani market with two electric vehicles, partnering with the country’s largest private electricity producer to facilitate the expansion. The move came after the U.S. and Canada both decided to impose a 100% tariff on Chinese electric vehicle imports, and the European Commission voted to raise its own tariffs by 35%.

Its expansion represents a boost to the business relationship between China and Pakistan at a time when both seem to be running out of friends – and when their own alliance has grown fraught.

Though China has long considered Pakistan a key part of its ambitious Belt and Road Initiative, a series of recent attacks on Chinese nationals working in Pakistan has injected the relationship with tension. After an explosion at Karachi’s Jinnah International Airport in October claimed the lives of two Chinese citizens, Chinese Ambassador Jiang Zaidong called the attacks “unacceptable.”

Still, there is a sense that neither side can afford to downgrade their relationship.

Pakistan has fraught relations with all three of its other neighbors, while China has been accused of an increasingly hostile approach towards foreign businesses, driving down foreign direct investment.

“It’s an important and close partnership, albeit one that has stumbled in recent months,” says Michael Kugelman, who directs the Wilson Center’s South Asia Institute. “In that regard, this EV plan could be not just an economic win, but also a confidence building measure.”

Economic win for who?
For China, Pakistan could be the key to tapping into the U.S. market, says Usman Qadir, senior research economist at the Pakistan Institute of Development Economics.

“If they are able to assemble their vehicles in Pakistan or a third country, then they can bypass tariffs and get into the market with their lower prices,” he says.

Pakistanis could benefit, too.

BYD and its local partner announced plans to build an assembly plant in Karachi by early 2026. They estimate that as many as half of the vehicles sold in Pakistan by 2030 will be electrified – by which time BYD hopes that its vehicles will make up a quarter of all sales.


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So far, the Chinese EVs launched in Pakistan have largely targeted the luxury market.

But whatever their long-term motive, it is clear that Chinese EV makers are having an impact; Japanese automakers, which have historically dominated the Pakistani market, have begun slashing their prices out of concern that they might lose ground.

[Riaz Haq]

Pakistan Motorcycles - Facts & Data 2025 | MotorCyclesData

https://www.motorcyclesdata.com/2025/02/01/pakistan-motorcycles/

In 2024, although a bad start of the year, then recovered in the second half, 2-wheeler sales have been 1.3 million (+18.4%) but half a million far from the record.

The just born EVs segment is fast growing, reaching 46.364 sales (+123.4%) with new local start up joined by Yadeaand other chinese manufacturers.

Looking at the performance among the top manufacturers, the leader Honda reports sales up 15.5%, ahead of United Auto (+29.3%), Suzuki (+17.3%) and Road Prince (+13%).

[Riaz Haq]

Sazgar bets on e-rickshaws for Pakistan’s EV future - Rest of World

https://restofworld.org/2025/sazgar-e-rickshaws-pakistan-ev-future/

Sazgar will set the ground for other companies in making e-rickshaws as a primary public transport choice.

By KUNWAR KHULDUNE SHAHID
12 FEBRUARY 2025 • LAHORE, PAKISTAN

Since last year, Pakistan has accelerated its shift to electric vehicles, with BYD planning to set up a production plant and the government targeting 30% EV adoption for all new vehicles by 2030.
As Pakistan’s top rickshaw maker, Sazgar pioneered e-rickshaws and hopes to make them a mainstream transport option.
Scaling up for companies like Sazgar will require stronger government policies, financial support for drivers, and political stability.

Pakistan hurtled toward its electric future in 2024. In August, Chinese EV giant BYD said it would set up its first South Asian production plant in the country. Three months later, the Pakistani government unveiled a policy that aims to transition a third of all new vehicles to electric by 2030.

Meanwhile, several local companies hastened plans to launch and produce EVs in a market flooded with importedelectric cars from international brands such as Audi, BMW, and Hyundai.

A front-runner among the local EV makers was Sazgar Engineering Works, a Lahore-based automotive manufacturer best known as Pakistan’s largest rickshaw maker.

In January 2024, Sazgar, which has made conventional rickshaws since 2005, became the first company to receive a license to produce e-rickshaws in Pakistan. The company is betting on e-rickshaws to boost mass adoption of EVs in the country. Given its legacy in the sector, Sazgar is poised to lead Pakistan’s EV revolution, automobile experts told Rest of World.

“The company has the infrastructure and resources to introduce e-rickshaws in the local market on a large scale,” said Sulman Ali, editor at PakWheels, a digital automobile publication and marketplace. “Sazgar will set the ground for other companies in making e-rickshaws as a primary public transport choice.”

Through the last decade, Sazgar has held sway over 30% of Pakistan’s rickshaw market, which currently comprises over a million rickshaws and 40 competitors. The company produces up to 2,500 rickshaws every month — most of which run on traditional fuels. It also exports its rickshaws to 30 countries including Sri Lanka, Liberia, Qatar, the U.S., and Japan, Syed Hasnain Mehdi, Sazgar’s EV project manager, told Rest of World.