Next auto policy to focus on EVs

Published November 18, 2020
The National Assembly Standing Committee on Industries and Production was informed on Tuesday that preparations were underway for the new auto policy. — Reuters/File
The National Assembly Standing Committee on Industries and Production was informed on Tuesday that preparations were underway for the new auto policy. — Reuters/File

ISLAMABAD: The National Assembly Standing Committee on Industries and Production was informed on Tuesday that preparations were underway for the new auto policy as the existing Automotive Development Policy (ADP) 2016-21 is set to expire in June next year.

The committee meeting, chaired by MNA Sajid Hussain Turi, inquired about the outcome of the existing auto policy.

Minister for Industries and Production Hammad Azhar briefed the NA body about the electric vehicles policy in connection with the ADP 2016-21.

The minister said that 20 new investors have been granted greenfield status and government has tried to create competition by granting functioning licences to six new entrants.

The committee was informed that apart from new entrants in the four-wheeler category which includes cars and SUVs, four new companies have entered the Pakistani market with buses.

The minister said that a total of around $476 million has been invested on the ground by the new entrants.

“The existing policy will strengthen the automotive sector of Pakistan by increasing overall installed capacity of local industries up to 418,000 per annum by June 2021, that was around 280,000 at June 2020,” Azhar informed the committee. He added that the ADP 2016-21 can be termed as a success.

The minister said that policies for two- and three-wheelers and heavy commercial vehicles have been approved by the Cabinet and implemented.

He added that the policy for hybrid vehicles will be covered in the ADP 2021-26. The policy will also include local manufacturing for electric vehicles (EVs).

Committee member MNA Sajida Begum said the lack of technology transfer was due to the incompetence of previous governments. MNA Syed Mustafa Mehmud expre­ssed his concern about hybrid vehicles while strongly stressing that EVs/vehicle technology should be launched instead of hybrid tech.

Quoting the example of reusable Tesla batteries in the USA, he added that electric charging station on solar-based technology should be encouraged and re-use of batteries at home may be worked out.

General Manager Policy Engineering Devolvement Board (EDB) Asim Ayaz briefed the committee and said that tariff announced for hybrid electric vehicles (HEVs) under ADP 2016-21 will provide 50 per cent exemption to 1800cc and 25pc exemption to HEVS exciding 1800cc.

He informed the committee that the EV Policy for four-wheelers was being finalised by the inter-ministerial committee headed by the industries minister for Industries.

Ayaz added that the board has already recommended for removal of additional custom duty, additional sales tax and federal excise duty under the new auto policy.

The committee members also expressed their concerns over the higher prices of vehicles in the country.

Published in Dawn, November 18th, 2020

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