In order to diversify fuel use and contribute to the reduction of carbon emissions, the Ministry of Industries and Production has developed a plan to create 100,000 e-bikes in the first 18 months.
Following the presentation of the plan at the most recent cabinet meeting, the prime minister forwarded it to the Economic Coordination Committee for additional discussion and work on the financial model. To encourage the purchase of motorcycles that are more expensive, the ministry has suggested a subsidy of Rs17.5 billion over the course of three years.
The government would put down Rs. 90,000 for an e-bike with an estimated price of Rs. 170,000, and the buyer would put down Rs. 10,000, making the total first payment of Rs. 100,000.
With government assurances, it is indicated that the bank will lend Rs70,000 at Kibor+2, or 19%, which is projected to be Rs13,300.
A 24-month installment plan has also been provided through the proposed scheme, under which the customer will pay Rs. 4,310 per month, which consists of the Rs. 2,917 principal, Rs. 1,109 in interest payments, and Rs. 284 in insurance payments.
According to the plan, the ministry anticipates producing and selling 15,000 e-bikes in the current fiscal year, and 60,000 and 100,000 e-bikes in the next two fiscal years, for a total of 175,000 e-bikes manufactured during the three-year period.
Through the subsidized program, e-bikes will be made available to:
- Students whose parents are employed
- Female students and employees (20 percent quota)
- Transgender people (1 percent quota)
- Government workers
- Self-employed and salaried private sector workers with NTNs and bank accounts,
- Government/armed forces retirees
- Imam Masjid/Hafiz Quran/Muazzam who have earned the necessary qualifications from a school approved by the government of Pakistan (endorsed by the Ministry of Religious Affairs).
The working paper for the program suggests three different subsidy models, including cash purchases, where individuals would pay a flat sum of Rs. 70,000 from their own resources and the government would split Rs. 100,000 through banks.
In the subsidized leasing concept, the government and the customer each contribute Rs 100,000, while the banks would provide Rs 70,000 as a loan with a 50% government credit guarantee.
Under the third model, 30pc downpayment of subsidy will be met by the government with a 50pc financing subsidy and a 50pc credit guarantee. It is suggested that PSO may be given a task to install EV chargers at select outlets in the target cities and special meters for commercial charging stations, metering as per solar tariff.
The first cities where the plan might be implemented are Islamabad, Peshawar, Quetta, Lahore, and Karachi.
As per an official statement, at present there are 90 companies manufacturing motorcycles and auto rickshaws in Pakistan and the country can manufacture 6 million motorcycles annually. It was further informed in the meeting that 22 companies have been issued licences to manufacture e-bikes.
