Hybrid and Electric Cars Likely to Become Cheaper After June Budget

The federal government is preparing a relief package for Pakistan’s auto sector under the upcoming budget and new auto policy like reducing import duties and expanding incentives for new energy vehicles.

The proposed policy also aims to expand coverage beyond battery-powered electric vehicles by including other new energy vehicles such as hybrids. Proposals to impose a 5 percent customs duty on hybrid vehicle parts have also been shared to streamline the tariff structure.

According to policy documents, authorities plan to abolish additional customs duties while gradually lowering regulatory duties under the National Tariff Policy framework.

Under the proposals, customs duty on auto parts may be set at 5 percent, while assembled vehicle units could face a 10 percent duty.

The government is eyeing fixing customs duty on Completely Knocked Down (CKD) kits between 5 percent and 10 percent, depending on each category.

Electric bikes, rickshaws, and electric vehicles are likely to receive exemptions from certain duty requirements to encourage the adoption of cleaner transportation and support the transition toward energy-efficient mobility.

The proposals are currently under consideration and will be reviewed in the coming weeks after meetings with lending entities.