ISLAMABAD: Pakistan’s government plans to introduce a new policy “soon” to promote electric vehicles in the country, Power Minister Sardar Awais Ahmed Khan Laghari said on Wednesday, as Islamabad seeks to cut its expensive fuel import bill and shore up its foreign exchange reserves. 

Pakistan approved an ambitious National Electric Vehicles Policy (NEVP) in 2019 with the goal that electric vehicles would comprise 30 percent of all passenger vehicles and heavy-duty truck sales by 2030. It set an even more ambitious target of electric vehicles comprising 90 percent of all vehicle sales by 2040. 

Pakistan’s urban areas exhibit some of the world’s highest levels of air pollution, primarily due to sub-2.5 μm particulate emissions. This issue significantly impairs both the country’s economy and the quality of life of its residents. Road transport is a significant contributor to air pollution as around 23 percent of Pakistan’s greenhouse gas emissions originate from vehicles.

“The minister highlighted that a policy that encourages the adoption of electric vehicles will be announced soon, which will accelerate the adoption of electric vehicles in the country, particularly two-wheelers, and three-wheelers,” Pakistan’s power ministry said in a statement. 

Leghari was speaking at an event titled, “Pakistan Power Reforms Project” at the Institute of Business Administration in Karachi. The minister spoke about a roadmap for reforms that needed to catalyze industrial and economic growth in the country. 

“Such an intervention will not just increase electricity demand, but also reduce household expenditure on transport, as well as significantly reducing import bill associated with fuel imports,” Leghari said. 

In August, Warren Buffett-backed Chinese electric vehicle giant BYD announced its entry into the country, saying that up to 50 percent of all vehicles bought in Pakistan by 2030 will be electrified in some form in line with global targets. 

Investment company ADM Group also announced in August it would invest up to $250 million for the manufacturing of electric vehicles in Pakistan in a move likely to boost technological advancements in the country’s automobile industry and curtail pollution.

Speaking about the government’s reforms, Leghari said that the country’s power division was working toward improving the governance standards of distribution companies “while pushing for a radical transformation of transmission infrastructure to improve efficiency and reduce losses.”

Talking about surplus generation capacity, Leghari said plans were in place to “stimulate industrial demand” to accelerate industrial and economic growth.

The minister highlighted that Pakistan has one of the cleaner energy mixes in the world, with more than 55 percent of electricity generated from clean hydel, nuclear and renewable sources. 

“More importantly, the same would exceed 70 percent within a few years,” he concluded. “Similarly, almost 75 percent of electricity generated in the country is through indigenous sources, and the same is expected to increase to more than 90 percent over the next few years.”