New Auto Policy to Make Vehicles Affordable: Tarar

Addressing a press conference alongside Prime Minister’s Adviser on Industries Haroon Akhtar on Saturday, Tarar said the policy had been prepared after extensive consultations with stakeholders, analysis of technical data and a review of automotive models adopted by different countries.

He said Pakistan had maintained high import duties on vehicles for decades to protect the local automobile industry. However, despite years of protection, the sector had failed to introduce the innovation and features available to consumers in other countries.

The minister said the purpose of supporting the local industry was to improve vehicle quality and provide better facilities to ordinary consumers. He added that Prime Minister Shehbaz Sharif had directed the creation of greater opportunities for the middle class in the automobile sector.

Highlighting the growing use of electric vehicles, Tarar said women and girls were increasingly using electric scooters to commute to educational institutions and workplaces. He described the expansion of electric motorcycles and scooters as an important development.

He said promoting electric vehicles would help reduce environmental pollution and the country’s oil import bill, which ultimately placed a burden on ordinary citizens. Savings from lower petroleum imports could be directed towards public services, infrastructure, healthcare and education, he added.

Tarar described the new policy as comprehensive, saying it offered special incentives for electric vehicles while also encouraging local manufacturing. He stressed that the automobile industry could not achieve its full potential without expanding exports and creating employment opportunities.

The minister clarified that petrol-powered vehicles with engine capacity of up to 800cc, commonly used by ordinary citizens, would continue to receive existing facilities under the policy.

He said customs duty had been exempted on equipment for establishing electric vehicle charging stations, while sales tax had also been reduced to encourage investment in charging infrastructure.

Inviting international and local manufacturers to invest in Pakistan, Tarar said the country had significant potential in the electric vehicle sector. He urged companies to establish manufacturing facilities, produce vehicles locally and explore export opportunities.

He said fuel expenses consumed a substantial portion of household budgets, while fluctuations in petroleum prices contributed to inflation. The new auto policy, he added, was intended to expand access to affordable and environmentally friendly transport, reduce import dependence and support economic growth.

Responding to a question about competition in the automobile market, Tarar said decades of protection had limited innovation and consumer choice. He said the new policy would encourage more manufacturers to enter the market, increase competition and improve facilities for buyers.

On the issue of non-custom-paid vehicles in Khyber Pakhtunkhwa, the minister said a transparent system was being developed to ensure that all vehicles were registered through the Customs and Excise departments.

He said a formal policy was being prepared to address the issue, adding that such vehicles had been used in terrorist incidents in the past. The government, he said, was working to resolve this and other related matters in the province.