Ministry of Climate Change to Allow Duty-Free Import of Electric Cars

  • The Ministry of Climate Change is planning to allow duty-free import of electric vehicles in bulk under the proposed electric vehicle policy.
  • The local auto industry has voiced serious concerns, saying that the plan would kill the country’s industry.
  • Electric vehicles were expensive; therefore, the Ministry of Climate Change planned to allow the duty-free import to make the business commercially viable.
Ministry of Climate Change to Allow Duty-Free Import of Electric Cars
Ministry of Climate Change to Allow Duty-Free Import of Electric Cars

The Ministry of Climate Change is considering over an amendment that will allow electric vehicles to be imported duty-free under the proposed Electric Vehicle Policy.

However, the local automakers have heavily criticized this scheme and called it an attempt to kill the industry.

The climate change ministry has exceeded its mandate in preparing the draft copy of the Electric Vehicle Policy. This is because the auto industry falls under the purview of the Ministry of Commerce and Ministry of Industries and Production.

The Climate Change ministry was told to stay out of the auto sector by the Industries ministry. But that didn’t stop the Climate Change ministry as they continued to work on the policy.

The Ministry of Climate Change wants to allow electric cars to be imported duty-free. This is because they are expensive and making them duty-free would help make these cars commercially viable.

The auto industry has already reduced its production levels because of declining sales amid added duties, taxes and devaluation of the local currency which has pushed the prices of cars out of the reach of many.

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It is also being feared that the domestic auto parts industry would be destroyed if importers started selling parts of electric vehicles in the country.

Earlier, the Ministry of Climate Change had put the draft on its website but it was later removed after the Ministry of Industries voiced its reservations.

Later, the Ministry of Industries had asked the Ministry of Climate Change not to intervene in affairs of the auto sector, which came under the purview of the industries ministry. However, the Ministry of Climate Change has continued to work on the policy.

Last month, Adviser to Prime Minister on Climate Change, Malik Amin Aslam, met with Ali Asghar Jamali, CEO Indus Motor Company, to discuss the electric vehicle policy.

Adviser to the Prime Minister underlined the government’s commitment to creating a market for electric cars in the country.

He was of the view that the Auto Industry Development Policy 2016-21 is not fit for electric vehicles and a new auto policy should be formulated.

As a response to this, Ali Asghar Jamali suggested that instead of importing completely built units of electric cars, the local industry should be encouraged to manufacture electric cars.

CEO Indus Motor Company pointed out that the auto industry contributed 3.4% to the country’s gross domestic product (GDP). He said that one-third of a car price went into the national kitty on account of taxes.

He also told that the government should give incentives to the local car manufacturers to encourage the production of electric vehicles in the country rather than allowing the import of such vehicles. Such imports would result in the flight of foreign currency reserves and that policy would have an impact on the local industry and leave many people unemployed.

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