THE approval of Pakistan’s first electric vehicle policy towards the end of last year has given rise to an ongoing media debate. It has been pointed out that while we are now one step closer to a pollution-free environment, a greener future will depend a lot on the development of fast-charging electric vehicle batteries and the availability of charging infrastructure on roads and highways. The new EV technology is considered a game changer for the environment and promises various benefits to developing countries like Pakistan that are facing chronic balance-of-payments crisis by reducing their fossil fuel imports, and to consumers by slashing their recurring fuel and maintenance costs. However, the adoption of EV technology remains slow even in developed countries despite its salutary impact on the environment and multiple economic advantages for consumers. Pakistan is unlikely to defy this global trend in spite of significant tax and other concessions announced in the policy to escalate the adoption of the technology. According to reports, the government plans that 30pc of all new cars, trucks, buses, vans and jeeps, and 50pc of all two-, three- and four-wheelers will be electric vehicles by 2030. By 2040, 90pc of vehicles on the road are envisioned as electric. An ambitious target indeed.
The slow adoption of green technology across the world has also raised the question of whether it is advisable for Pakistan to jump directly into an electric future or take the hybrid route. While Chinese carmakers are in favour of a direct shift to an EV future, Japanese automobile companies want the government to follow a route where both electric vehicles and hybrid (including plugged-in hybrid) electric vehicles are allowed to compete as is the case in countries like India, Thailand and Malaysia. Hence, Japanese carmakers in Pakistan have been calling for similar incentives and concessions for hybrid technology. The step-by-step approach, they say, to move from the existing internal combustion engines to zero-emission vehicles will benefit every stakeholder — automobile companies, auto parts manufacturers, government and consumers. They have a strong point when they argue that hybrid electric vehicles can ‘achieve scales given their costs and subsequently when EV technology becomes more affordable the country can always graduate to electric vehicles’. The Engineering Development Board, which is developing the next Auto Industry Development and Export Programme 2021-26, needs to carefully weigh the arguments advanced by both sides and take ground realities into account before finalising the new policy.
Published in Dawn, February 23rd, 2021