By Sardar Khan Niazi

Pakistan’s automobile sector is at an important crossroads. The country is simultaneously trying to revive manufacturing, attract investment, reduce its import bill, improve urban air quality and move towards cleaner transport. Yet its policy framework continues to treat electric vehicles (EVs) as a separate category from the broader automobile industry. That distinction is increasingly difficult to justify. The merger of EV and automobile policies is not merely an administrative convenience; it is the logical next step in developing a coherent transport and industrial strategy. EVs are automobiles. They use roads, require financing, depend on dealerships and after-sales services, employ workers, and form part of the same mobility ecosystem as conventional vehicles. Maintaining separate policy regimes risks creating unnecessary duplication and, more importantly, conflicting incentives. Pakistan needs an automobile policy that is technology-neutral while remaining firmly aligned with its environmental and energy objectives. A unified policy could provide a single framework for investment, localization, manufacturing, taxation, consumer incentives and research and development. Instead of repeatedly designing separate rules for internal-combustion vehicles, hybrids and EVs, policymakers could establish a common set of industrial objectives and then use targeted incentives to encourage technologies that serve national priorities. This would also provide greater certainty to investors. The objective, however, should not be to simply fold EVs into an existing automobile policy and declare the job finished. A merger should mean rationalization. It should remove contradictions and create a framework in which different technologies compete and evolve while the government steadily raises efficiency and environmental standards. Localization should be at the heart of such a policy. Pakistan has spent decades trying to develop an indigenous automobile supply chain, but the sector remains heavily dependent on imported components. The transition towards EVs creates both a challenge and an opportunity. Electric powertrains have fewer mechanical components than conventional engines, while batteries, power electronics, charging equipment and associated technologies open new areas for domestic manufacturing. The government should therefore link incentives to measurable localization targets rather than merely offering blanket concessions. Firms that develop local vendor networks, transfer technology, train workers and invest in research should receive stronger and more predictable support. Consumer policy also needs to become more coherent. If EV adoption is a national objective, consumers should not have to navigate an uncertain maze of taxes, duties and registration rules. At the same time, incentives must be designed carefully. Pakistan cannot afford an open-ended subsidy program that primarily benefits higher-income consumers purchasing expensive imported vehicles. Public money would arguably have a greater impact if it were directed towards affordable electric cars, two- and three-wheelers, buses, commercial fleets and charging infrastructure. Indeed, the two- and three-wheeler market deserves particular attention. Motorcycles and rickshaws are central to urban mobility in Pakistan, and electrifying these segments could potentially deliver wider social and environmental benefits than concentrating policy support on premium passenger cars. Infrastructure is another reason for adopting an integrated approach. EV policy cannot succeed as an isolated industrial program. Charging networks, electricity distribution, parking regulations, building codes and public transport planning all have to be considered together. The same policy framework should therefore connect vehicle manufacturing with the energy and transport systems on which those vehicles depend. The transition must, however, be realistic. Pakistan cannot decree an overnight shift to electric mobility. Consumers remain highly sensitive to vehicle prices, financing costs, resale values and the availability of spare parts. Manufacturers need time to establish supply chains, while the power sector needs to prepare for additional electricity demand. Policy should therefore provide a predictable transition rather than impose abrupt targets without the infrastructure or market conditions to support them. The real question is not whether Pakistan should have an EV policy or an automobile policy. It is why the country needs two separate frameworks for an industry that is already undergoing technological convergence. The automobile of the future may be electric, hybrid, connected or powered by technologies that are still developing. Government policy should not become trapped in today’s categories. It should establish the industrial, environmental and consumer objectives. Merging EV and automobile policies would be a sensible starting point. But the larger task is to create a stable, predictable and investment-friendly automobile strategy—one that supports localization, encourages cleaner mobility, protects consumers and recognizes the realities of Pakistan’s energy and fiscal constraints.