Draft auto policy sent to cabinet

Dawn reported that Prime Minister Shehbaz Sharif approved a draft five-year auto policy on Tuesday, which is now due to go to the federal cabinet for initial approval and then Parliament. It aims to lift vehicle and parts exports to $6.01 billion over 2026-31, while cutting tariffs on imported vehicles and kits to as low as 15pc by 2030-31.

The proposals include a 1pc sales tax on battery electric vehicles, higher financing limits of Rs10 million and repayment periods of up to five years. Manufacturers would face export and local-parts targets, with incentives for exceeding export benchmarks and possible penalties for missing targets; the government expects more than Rs232bn from the Automotive Development Levy over five years.

Paapam chairman Abdul Rehman Aizaz warned that lower parts tariffs could weaken local manufacturers and make Pakistan more reliant on imported vehicles. The draft also proposes a Pakistan Automotive Testing Institute and funding for research, certification and safety standards.