New auto policy proposes up to 80% cut in vehicle tariffs

The government is considering major changes to the country’s auto and auto parts manufacturing sector under a new proposed policy. One of the key recommendations is to reduce tariffs on vehicles by up to 80 per cent.

The proposals were reviewed during a meeting chaired by Prime Minister Shehbaz Sharif. The meeting discussed measures aimed at promoting vehicle manufacturing, encouraging investment and strengthening the domestic auto industry.

A major proposal relates to electric vehicle financing. The government has suggested increasing the loan limit for electric vehicle purchases from Rs3 million to Rs10 million. The repayment period for new energy vehicle loans has also been proposed to increase from three years to five years.

The policy also focuses on boosting the production and export of auto parts. A proposal has been made to bring five major manufacturing companies into the auto parts export sector. SME clusters would then be developed around these major manufacturers to strengthen the local supply chain.

Another key proposal seeks to eliminate duties on imported auto parts used in products manufactured for export. The measure is aimed at reducing production costs and making Pakistani auto parts more competitive in international markets.

The committee formed to review the auto parts policy has approved several important recommendations. The proposed measures are aimed at increasing local production, attracting investment, supporting small and medium-sized businesses and expanding auto-related exports.