Pakistan is considering major financing support for electric and new energy vehicle buyers under its proposed Automotive and Auto Parts Manufacturing Policy 2026-31.
The draft policy proposes vehicle financing of up to Rs. 10 million for a period of five years. The measure is aimed at making electric and new energy vehicles more accessible to buyers.
The plan also includes tax incentives for locally manufactured new energy vehicles.
Qualifying locally produced vehicles could receive preferential General Sales Tax rates. They may also be exempt from Federal Excise Duty, Capital Value Tax and Withholding Tax. These incentives would apply to vehicles priced below $75,000.
The government is also considering lower customs duties on completely built battery electric vehicles.
Under the proposal, battery electric vehicles priced up to $15,000 could face a reduced customs duty of 5 percent during fiscal years 2026-27 and 2027-28.
Another major part of the draft policy focuses on charging infrastructure.
The government plans to support the expansion of EV charging stations, battery-swapping facilities and battery-as-a-service systems.
The policy also proposes an Auto Development Levy on internal combustion engine vehicles.
Revenue from the levy would help fund Pakistan’s transition toward new energy vehicles. It could also support research, development and local vendor growth.
Authorities also want to increase local production of electric vehicles and their components.
This could reduce dependence on imports while encouraging investment in Pakistan’s automotive manufacturing sector.
However, the policy has not yet been formally approved.
The draft has moved through several government committees since June and remains under consideration.
If approved, the financing and tax measures could significantly lower the cost barrier for electric vehicle buyers and accelerate Pakistan’s shift toward cleaner transport.
