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Duty Free Imports of Electric Cars: Economic Solution to Climate Change

The Ministry of Climate Change and the Ministry of Industries appear to be embroiled in a conflict over the proposed Electric Vehicle Policy, spearheaded by the former. The Ministry of Climate Change has proposed duty-free imports of electric cars to make them commercial viable.

Electric

The Ministry of Climate Change is considering to usher in an amendment under the proposed Electric Vehicle Policy, which will allow electric vehicles to be imported with a duty-free policy. This proposed scheme has garnered strong criticism from local automakers, who believe it is an attempt to trigger a downfall of the local industry.

A War of Two Ministries?

In a peculiar turn of events, the Ministry of Climate Change has surpassed its authority in preparing the draft copy of the proposed Electric Vehicle Policy, since the auto industry falls under the mandate of the Ministry of Industries and Production, and the Ministry of Commerce.

The Electric Vehicle Policy is due to be discussed by members of the Federal Cabinet in the next cabinet meeting, where it is likely to be approved. The Ministry of Climate Change has issued the draft of the policy on its official website earlier, however, objections raised by the Ministry of Industries and Productions compelled them to take it down.

Local automobile industry has widely criticized the notion of importing duty-free electric vehicles as local automotive producers believe that it would kill the domestic industry

Sources reveal that the Ministry of Climate Change has been directed to stay out of the automobile sector by the Ministry of Industries, however, this was not enough to stop the Ministry of Climate Change to abandon its work on the Electric Vehicle Policy.

Sources say that the Climate Change ministry was told to stay out of the auto sector by the Industries’ ministry but that didn’t stop the Climate Change ministry as they continued to work on the policy. The Ministry of Climate Change is determined to allow electric cars to be imported duty-free, considering that they are expensive, and eliminating the tax duties will make them more affordable and commercially viable.

However, the local automobile industry has widely criticized the notion of importing duty-free electric vehicles as local automotive producers believe that it would kill the domestic industry, and thousands will lose their jobs.

Given the reduced pace of automobile demand amongst consumers, the production across the domestic industry has already dipped low. Officials have highlighted that aside from the engines, fuel-operated vehicles and electric cars are principally the same in every aspect.

Read more: Electric Cars in Pakistan! The Perks of CPEC

The domestic industry has also raised concerns that the local manufacturers will suffer a negative impact if importers began selling electric car parts across Pakistan.

Rising Demand for Electric Vehicles

Earlier in August, Malik Amin Aslam, Special Adviser to the Prime Minister on Climate Change, sat down with Ali Asghar Jamali of the Indus Motor Company, to have a discussion on the proposed electric vehicle policy.

Malik Amin Aslam underscored that the PTI-led government is committed to creating a market for electric vehicles across Pakistan. The Special Adviser to the PM on Climate Change observed that there is a need for a new automotive policy as the Auto Industry Development Policy 2016-2021 is no not suitable for electric cars.

Ali Asghar suggested that instead of important completely built units (CBUs) of electric vehicles, the government must encourage the local industry and automotive manufacturers to produce electric cars.

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