In a major push towards greener and more affordable transport, the federal government will unveil a new five-year electric vehicle (EV) policy on August 14, backed by the International Monetary Fund (IMF).
The initiative, worth Rs 100 billion in subsidies, is expected to transform the country’s EV landscape, with a strong focus on electric bikes and rickshaws — the most widely used modes of transport in Pakistan.
Rs 9 billion released by the IMF for the current fiscal year
According to officials from the Ministry of Industries and Production, the IMF has already released Rs 9 billion for the current fiscal year under the package.
This funding will go towards the first phase of implementation, which aims to distribute 116,000 electric bikes over two years. Each bike and rickshaw will receive a subsidy of around Rs 50,000, helping reduce purchase costs for middle- and lower-income families.
The policy, which will remain in force until 2030, has been drafted after consultations with the IMF to address the shortcomings of the earlier EV policy. That policy fell far short of expectations, delivering only 50,000 two- and three-wheelers against a target of 500,000.
Read more: Pakistan to target 30% EVs by 2030 with the new national electric vehicle policy
Similarly, just 200 electric buses entered service, far below the target of 1,000, while 3,000 electric cars hit the market if it is compared to an ambitious target of 100,000.
Future funding allocations also planned
Subsidies are going to increase to Rs 19 billion in FY27, Rs 24.16 billion in FY28, Rs 26.62 billion in FY29, before easing to Rs 22.64 billion in FY30. Officials keep on saying this gradual increase is strongly depicting the government’s strategy to support demand while giving manufacturers time to scale up production capacity.
Prime Minister Shehbaz Sharif is anticipated to formally declare the policy and oversee the rollout of the first batch of electric bikes on Independence Day.
Positive impacts associated with it
Experts believe the initiative could ease Pakistan’s dependance on
- Costly imported fuel
- Cut carbon emissions
- Provide affordable transport solutions to millions
“If executed effectively, this policy could prove to be a game changer for Pakistan’s urban mobility,” a senior ministry official commented.