Arsalan Ali

Electric vehicles (EVs) hold immense potential to drive multifaceted growth in Pakistan, but unlocking their success requires the implementation of clear and focused policy measures, according to Pakistan Business Council (PBC). A recent report by the PBC emphasised the need for a well-defined policy and procedural framework to facilitate the widespread adoption of EVs in Pakistan, which promises a host of compelling long-term benefits. While the current cost of owning an EV remains higher than that of internal combustion engine vehicles, primarily due to expensive battery technology, the report underscores its significant economic advantages. These advantages include a substantial decrease in fuel imports, optimisation of underutilised generation capacity, and remarkable contribution towards the reduction of greenhouse gas emissions. The Ministry of Climate Change and Environmental Coordination in Pakistan has raised a critical concern regarding air pollution, emphasising the dire consequences associated with the combustion of fossil fuels.

Talking to WealthPK, Dr Abedullah, Chief of Research at the Pakistan Institute of Development Economics (PIDE), drew attention to a pressing concern: the transportation sector's role as the largest consumer of oil, and a major contributor to the country's environmental degradation. He emphasised that vehicle emissions are degrading the environment and exacerbating air pollution. Dr Abedullah said that the local manufacturing of EVs in Pakistan not only offers a solution to environmental issues, but also presents opportunities for the development of new industries. He said that the widespread adoption of EVs holds the potential to significantly reduce the emission of hazardous pollutants. “By embracing EVs and renewable energy sources, Pakistan can effectively reduce its reliance on oil, leading to a substantial decrease in the fuel import bill,” he added.

In November 2019, Pakistan took a significant stride towards combating climate change and reducing its oil import bill by implementing the EV Policy, led by the Ministry of Climate Change. This policy aims to effectively tackle the environmental issues posed by the transport sector while fostering the growth of a new industry. According to the PBC report, the country's economy confronts the formidable challenge of an oil import bill, with the transport sector accounting for a substantial 60% to 76% of its consumption. Data from Pakistan Bureau of Statistics (PBS) reveals the magnitude of the issue at hand. During the initial 11 months (July-May) of the current fiscal year (FY23), petroleum group imports soared to a staggering $15.38 billion. Furthermore, data from the Oil Companies Advisory Council (OCAC) shows that the transport sector's consumption of fossil fuels and energy products in April 2023 alone reached a staggering 1,038,746 metric tons.

The report identifies key areas for attention and action to drive the transition to EVs in Pakistan. These encompass infrastructure development, incentives for research and development, support for local manufacturing of EV components, education and training programmes, and public awareness campaigns to foster widespread EV adoption. Pakistan's two-wheeler and three-wheeler market segments present a lucrative market opportunity for the adoption of EVs. A crucial aspect highlighted in the report is the need for substantial investment in charging infrastructure to ensure the successful integration of EVs in heavy and light commercial vehicles. The strategic placement of public chargers along metro routes and motorways can serve as a catalyst for widespread EV adoption. While global leaders such as China, EU, and US dominate the EV consumer market, emerging populous economies like Brazil, India, and Indonesia lag behind, accounting for less than 0.5% of EV sales.

Credit : Independent News Pakistan-WealthPk