ISLAMABAD: Pakistan is set to launch a locally manufactured low-cost electric vehicle (EV) priced at Rs1 million ($3,556), aimed at helping motorcycle users transition more easily to cars, an official from the Engineering Development Board (EDB) told Arab News on Monday.

The country has seen a gradual rise in the adoption of EVs in a market traditionally dominated by Japanese automakers. The development comes as major cities across Pakistan face some of the world’s highest levels of air pollution, leading to dense smog in winter, with road transport being a major contributor.

In June last year, Pakistan introduced its Electric Vehicle Policy 2025–30, announcing more than Rs100 billion ($353 million) in subsidies over five years to support electric bikes and rickshaws and accelerate the shift toward cleaner transport.

“The car will be fully made in Pakistan and a local company is working on it,” Zeeshan Ashraf, a spokesman for the Engineering Development Board, a government body, told Arab News. “Its full price will be Rs1 million while the government is planning to give extra subsidy on this.”

Chinese and Korean electric vehicle brands have increasingly entered Pakistan’s market in recent years, making EVs a more common sight in cities such as Islamabad, Lahore and Karachi.

Ashraf said the vehicle will be launched under the Pakistan Accelerated Vehicle Electrification (PAVE) Program, a public-sector initiative designed to promote an eco-friendly and economical transportation system in the country.

The locally manufactured low-cost EV is expected to become available across the country within the next few months, he added.

Earlier, Engineering Development Board Chief Executive Hammad Mansoor was quoted by local media as saying that Pakistan could see its first fully electric, locally manufactured car enter the market by June 2026, with an estimated price of around Rs1 million.

Speaking to journalists during an iftar dinner in Karachi this month, Mansoor also signaled that the government may lower vehicle taxes in the upcoming federal budget to make hybrid, electric and conventional fuel vehicles more affordable.

He said Pakistan’s first lithium battery manufacturing facility is expected to begin production by May, while a second plant could start operations in September.

According to him, about 74 percent of battery components will be produced locally, which could significantly reduce the cost of EVs by relying on domestically manufactured parts.