ISLAMABAD, Nov. 8 (Xinhua) -- Pakistan has announced a new automotive policy targeting 6 billion U.S. dollars in cumulative exports over five years, with incentives to boost overseas sales, local manufacturing and electric vehicle adoption.
Addressing a press conference here on Saturday, Prime Minister's Adviser on Industries and Production Haroon Akhtar Khan said the policy aims to increase annual automotive exports to 1.2 billion U.S. dollars from around 200 million dollars in the last fiscal year.
He said manufacturers would receive a 5 percent export rebate under the drawback of local taxes and levies scheme, with an additional 10 percent incentive for improved export performance.
Those failing to meet export and localization targets would face penalties and lose export benefits.
The policy, finalized after consultations with industry stakeholders, requires federal cabinet approval.
The government also plans tax incentives for electric vehicles, proposing sales tax rates of 1 percent for fully electric vehicles, 6 percent for range-extended electric vehicles and 9 percent for plug-in hybrids. The concessions, subject to International Monetary Fund approval, would apply to vehicles priced below 50,000 U.S. dollars.
To finance the incentives, the government plans an automotive development levy on conventional engine vehicles, excluding those with engine capacities of 1,000 cc or less.
The government aims to improve export competitiveness, reduce vehicle prices and promote domestic manufacturing while lowering dependence on imported fuel. ■
