ISLAMABAD: The Ministry of Industries and Production reviewed the draft ‘Auto Policy’, which is expected to be unveiled on July 1, 2026, and stated that the policy focuses on localization to help bring vehicle prices down.
In this connection, a meeting was held here on Tuesday under the chairmanship of Special Assistant to the Prime Minister (SAPM) on Industries and Production, Haroon Akhtar Khan, with a delegation of auto parts manufacturers to discuss the forthcoming auto policy and measures for strengthening the local industry.
The meeting was also attended by the Secretary of Industries and Production, Saif Anjum, and the CEO of the Engineering Development Board (EDB), Hammad Mansoor, along with other relevant stakeholders. During the meeting, detailed deliberations were held on the new auto policy, with a strong emphasis on the localization of auto parts manufacturing.
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The SAPM said that the government was pushing for the local auto parts industry in a major policy overhaul. Haroon Akhtar stated that promoting the local production of auto parts remains the core objective of the new auto policy.
Emphasizing the need for modernization, Haroon Akhtar urged auto parts manufacturers to transition towards electric vehicle technology to remain competitive in the evolving global market.
He further stated that the new auto policy will significantly enhance local production and boost exports. The SAPM assured that the policy will be formulated through extensive consultation with all stakeholders. Haroon Akhtar directed the Engineering Development Board to engage with all relevant stakeholders to ensure an inclusive and effective policy framework.
Secretary Industries and Production, Saif Anjum, informed participants that the Ministry is in the process of compiling a comprehensive list of auto parts that can be manufactured locally. He further highlighted that, over the next five years, adequate protection will be provided to domestically produced parts to support the growth of the local industry.
Haroon Akhtar Khan underscored that the new auto policy will be comprehensive and geared towards fostering the domestic automotive sector. He reiterated that reducing vehicle prices through effective policy measures remains a key priority of the government.
The meeting also discussed proposals to introduce special incentives for electric vehicle (EV) parts manufacturing. The Secretary of Industries noted that these incentives are currently under consideration to encourage investment in emerging technologies.
The government is considering tax and duty changes in the new auto policy to make vehicles more affordable for the middle class. EDBCEO Hammad Ali Mansoor said the policy is expected to be unveiled on July 1, while small electric vehicles priced below Rs1 million are due this year.
The representatives of the auto parts manufacturers association informed the meeting that they were facing a decline despite a rise in the number of vehicle assemblers. They said one issue was that new entrants in the sector were importing localized parts that attracted 25 percent import duty, while they are continuing to bring parts through CKD kits by paying 15 percent customs duty.
They stressed that the new auto policy should give priority to small and medium-sized auto parts manufacturers, which they described as the backbone of the economy, and said the government must ensure actual manufacturing in Pakistan rather than focusing on assembling automobiles.
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