The Auto Industry Development Committee of Engineering Development Board (EDB) is meeting on Thursday with Prime Minister Advisor on Commerce, Industries and Production and Investment, Abdul Razak Dawood in the chair to discuss Electric Vehicle Policy for four wheelers.
The committee meeting which will be attended by the private sector and public sector stakeholders would also formulate Electric Vehicles policy for two wheelers and three wheelers.
Sources close to Secretary Industries and Production told Business Recorder that in pursuance of the decision of the Cabinet of August 21, 2019 under rules of business, formulation of policy for EVs is akin to the functions assigned to Ministry of Industries and Production. MoI&P notified a committee for EV Policy formulation under the chairmanship of Additional Secretary MoI&P on September 5, 2019.
EDB was assigned the role to act as secretariat for EV Policy. First meeting of the committee was scheduled in MoI&P on September 18, 2019 under the chairmanship of Additional Secretary MoI&P which was attended by the Ministry of Climate Change (MoCC), Federal Board of Revenue (FBR), Ministry of Science and Technology. EDB held several consultative sessions in Islamabad, Lahore and Karachi, wherein different proposals were discussed. The stakeholders gave their inputs on incentives package, infrastructure development, environment impact, correlation with Automotive Development Policy (ADP-2016-21), future prospects etc.
According to sources, the MoI&P has proposed that existing tariff on imported parts which are being manufactured locally should remain at 25 percent. However, the Ministry has recommended one percent customs duty on EV related parts and 10 percent duty to align it with ADP 2016-21.
The sources said detailed list of parts would be prepared in consultation with stakeholders. ADP tariff to continue till 2021 - 10 percent and 25 percent in case of non-localized and localized. GST will be five percent of prevailing rate to encourage EV penetration. Hybrid and other fuel efficient technologies would be promoted.
Talking about three wheelers (loader and Rickshaws), the sources said existing tariff would be applied on localized parts, whereas remaining parts (EV specific/related) one percent custom duty has been proposed. In all the three categories including 2-3 wheelers, hybrid technologies will be given similar incentives as of EVs.
The sources said MoI&P would carry out extensive exercise for preparation of entire lists of parts being used in the normal and EV related vehicles.
The sources further stated that electric buses and trucks might be targeted for plying on fixed routes such as Metro or intercity routes where provision of infrastructure i.e. charging stations was feasible as compared to other categories of vehicles. However, discussions are required to be carried out with the fleet operators for EV buses and trucks, in view of tariff structure provided in ADP 2016-21.
Under the policy, buses falling under HS code 8702 of ADP serial number 10, CBU (hybrid Electric Vehicles HEVs), one percent customs duty till 2020-21 has been announced. Similarly, trucks falling under HS code 8704 (CBU electric hybrid vehicles) would also attract one percent CD.