The Government of Pakistan has committed a substantial Rs. 100.36 billion in total subsidies through 2030 to accelerate the country’s shift toward cleaner transport under the New Energy Vehicles Policy (NEVP) 2025–2030.This ambitious initiative covers electric bikes, rickshaws, loaders, cars, buses, and trucks, aiming to reduce dependence on imported fossil fuels, curb carbon emissions, and foster domestic EV manufacturing.
The policy marks a pivotal step in addressing Pakistan’s energy and environmental challenges. The transport sector consumes around 79% of the nation’s oil demand, contributing heavily to foreign exchange outflows and air pollution in urban centres like Karachi and Lahore, according to Asim Ayaz, General Manager of Policy at the Engineering Development Board.
By promoting electric vehicles (EVs), particularly two- and three-wheelers that dominate local mobility, the NEVP targets 30% of new vehicle sales to be electric by 2030. This is expected to save billions in fuel imports—potentially up to $1 billion annually—while cutting greenhouse gas emissions by millions of tons and creating green jobs in manufacturing and infrastructure.
The flagship Pakistan Accelerated Vehicle Electrification (PAVE) Scheme, implemented by the Engineering Development Board (EDB) under the Ministry of Industries and Production, is now operational. Phase-I, launched following e-balloting in late 2025, provides subsidies for 41,000 vehicles: 40,000 electric bikes and 1,000 electric rickshaws/loaders.
Successful applicants under the Self Finance Scheme receive up to Rs. 80,000 directly reimbursed by the State Bank of Pakistan after vehicle purchase and registration. The Bank Lease Scheme offers subsidized installments for easier access.
As of January 21, 2026, subsidy transfers have commenced for the first verified beneficiaries, signaling the scheme’s move from planning to real-world impact. Coordination among EDB, State Bank, PITB, NADRA, banks, and approved manufacturers ensures transparent, digital verification. Only registered EVs qualify, preventing misuse.
Phase-II will expand to an additional 78,170 vehicles with Rs. 8.95 billion in subsidies during 2025–26, building momentum toward broader categories like cars, buses, and trucks. The NEVP also envisions infrastructure growth, including 3,000 charging stations nationwide by 2030, battery swapping, and vehicle-to-grid integration to utilize surplus electricity.
Beneficiaries have welcomed the move, citing affordable cleaner mobility amid rising fuel costs. For many in low- and middle-income groups, especially rickshaw drivers and delivery riders, subsidies make EVs viable alternatives to petrol vehicles.
Experts view this as a strategic response to global trends and local needs—lowering healthcare costs from pollution, boosting local industry (with dozens of licensed EV manufacturers), and aligning with renewable energy growth.
Challenges remain, including charging infrastructure rollout and battery supply chains, but the subsidy commitment underscores sustained government resolve.
This policy positions Pakistan to join regional EV leaders, transforming transport into a sustainable, efficient sector for future generations.