E-bikes, rickshaws get Rs9bn subsidy under National Electric Vehicle policy
ISLAMABAD: The government on Thursday launched the National Electric Vehicle (NEV) Policy 2025-30, describing it as a transformative step in Pakistan’s journey towards industrial growth, environmental protection and energy efficiency.
One of the key targets under the policy is to ensure that electric vehicles account for 30 per cent of all new vehicles sold in the country by 2030.
This transition is projected to save 2.07 billion litres of fuel annually, resulting in nearly $1bn in foreign exchange savings. Additionally, the policy aims to reduce carbon emissions by 4.5 million tonnes and cut healthcare-related costs by $405m each year.
Addressing a news conference, Special Assistant to the Prime Minister on Industries and Production Haroon Akhtar Khan said the new EV policy is in line with the premier’s vision of promoting clean, sustainable and affordable transport while boosting local industry and protecting the environment.
He emphasised that the transport sector is a major source of carbon emissions in Pakistan and urgently needs reform.
Mr Akhtar announced that an initial subsidy of Rs9bn has been allocated for the fiscal year 2025-26, under which 116,053 electric bikes and 3,171 electric rickshaws will be facilitated. Besides, 25pc of this subsidy is reserved for women to provide them with safe, affordable and eco-friendly mobility.
He said a fully digital platform has also been introduced to ensure transparent online application, verification and disbursement of subsidies.
Furthermore, the policy outlines the installation of 40 new EV charging stations on motorways, with an average distance of 105 kilometres between them.
The policy also includes the introduction of battery swapping systems, vehicle-to-grid (V2G) schemes and mandatory integration of EV charging points in new building codes to facilitate wider adoption in urban areas.
Currently, over 90pc of parts for two- and three-wheelers are already manufactured locally and to encourage local manufacturing, incentives are being provided to domestic producers.
The government will also introduce special support packages for small and medium enterprises (SMEs) to further boost localisation.
He also highlighted that locally produced goods were 30-40pc cheaper than imported alternatives. In the two-wheeler segment alone, more than 90pc of parts are now produced locally.
The Auto Industry Development and Export Policy will remain in place until 2026 and will be phased out gradually by 2030, he added.
The PM’s special assistant noted that the policy was developed through consultations with over 60 experts, institutions and industry stakeholders, guided by a steering committee under the Ministry of Industries and Production since September 2024.
The committee will hold monthly and quarterly review meetings, while the auditor general of Pakistan will conduct a performance audit every six months.
He stressed that the NEV Policy 2025-30 is not only an environmental revolution but also a foundation for industrial growth, local employment, energy efficiency and technological self-reliance in the country.
The policy is expected to yield savings of around Rs800bn over the next 24-25 years through reduced fuel imports, the use of cheap electricity and revenue from carbon credits. Charging vehicles with electricity will also reduce capacity payments from Rs174bn to Rs105bn, and carbon credits could generate around Rs15bn in revenue.
The country’s total energy demand for EVs over the next five years is projected at 126 terawatt-hours, which can be met using the existing surplus in the national grid.
He added that an electric rickshaw or bike user is expected to recover their initial investment within a year and 10 months due to the low cost of charging compared to petrol.
For instance, if the additional cost of an electric bike is Rs150,000, this can be recouped within less than two years through fuel savings.
Mr Khan concluded by saying that the government has also provided exemptions on customs duties and sales tax on EV parts to support the local industry.
Published in Dawn, June 20th, 2025