Govt mulls tax cuts on vehicles in coming budget: First home-grown EV to hit roads this summer

KARACHI: Pakistan’s first fully homegrown electric vehicle is set to hit roads by June or July this year at a price below Rs1 million, as the government plans to significantly cut taxes on locally assembled vehicles in the upcoming federal budget.

Speaking at an Iftar dinner hosted by Mashood Khan, Director of the Small and Medium Enterprises Development Authority (SMEDA), at a local hotel, Hamad Ali Mansoor, CEO of the Engineering Development Board (EDB), announced that this will mark the first time in the country’s history that a domestically manufactured electric vehicle rolls off local production lines.

He said the manufacturing plant for the Made in Pakistan EV was established in Lahore and the vehicle is expected to be priced below Rs1 million — an effort to help two-wheeler owners transition to four-wheelers.

READ ALSO: Pakistan’s first homegrown EV to hit roads this summer under Rs1mn price, EDB chief says

The vehicle will offer a range of up to 180 kilometres on a single charge, making it a practical option for everyday commuters, he added.

Hamad further revealed that the government plans to significantly cut taxes on locally-assembled vehicles in the upcoming federal budget, a move aimed at making cars more affordable for the general public and boosting the local auto industry.

He further said that the longstanding monopoly of large automobile companies in Pakistan is effectively coming to an end and added that two to three more companies already expressed interest in manufacturing EVs in the country.

Under the upcoming Auto Policy, the Prime Minister has decided to extend full support to the local auto sector, signalling a decisive shift toward industrial self-reliance.

Plans are also in place to export Made in Pakistan vehicles to international markets, for which Rs100 billion in export incentives has been allocated, Mansoor said, adding that the Prime Minister has also outlined a subsidy plan to make e-bikes and e-rickshaws more affordable across the country.

Meanwhile, Mashood Khan said that Pakistan’s economic future hinges on the success of its Small and Medium Enterprises (SMEs), driven by young and innovative entrepreneurs. SMEs currently employ nearly 25 million people and contribute approximately Rs2.8 billion in exports, making them the country’s most dynamic economic force. With policy consistency, access to finance, and export facilitation, Pakistan’s SMEs can transform into global competitors, driving jobs, growth, and long-term economic stability, Mashood added.

Copyright Business Recorder, 2026