Syed Asim Ali Bukhari
THE growing number of environmentally conscious citizens of Pakistan maybe strong advocates of the current government’s ‘Clean and Green Pakistan’ vision, but time and again, even their optimism is flabbergasted by the lack of synergy between the various institutions’ green policies and initiatives. Whether, it is the affordable housing schemes or various other developmental projects being launched in the country, unfortunately, green management principles have only been superficially integrated. Globally, automobile industry is in a transformation phase from hydrocarbon based fuels to more efficient and greener technologies due to increasing concerns regarding environmental degradation. Recently, the new Electric Vehicle (EV) policy was approved by the Government of Pakistan. An essential feature of a good policy is that it must be inclusive, realistic and create a synergistic blend between all relevant stakeholders. Although, the development of the new EV/Green Vehicle policy is a good step towards a green transportation sector in Pakistan, numerous questions regarding role of various stakeholders has been left unanswered.
Globally, EVs are slowly and steadily capturing the automobile industry. The development of Pakistan’s EV sector is a dynamic journey involving various challenges. The Government of Pakistan plans to switch over to 30% EVs by 2030 under this Policy. Before a thriving and environmentally sustainable transport sector is developed in Pakistan, we need a reality check concerning various unsolved obstacles in our country. Unfortunately, this sector is facing several issues such as high capital cost and running cost of EV, range anxiety, battery charging timing and performance, unavailability of charging infrastructure, unsupportive road infrastructure and lack of EV knowledge among stakeholders. Mass adoption of EVs is eventually reliant on consumer’s readiness to purchase the technology. For consumers the electricity shortage and high cost of electricity in Pakistan will negatively influence the adoption of EVs. The increased electricity demand due to EVs can add extra pressure to the grid, especially at peak-hour time periods. It can create a situation similar to the one when vehicles started running on Compressed Natural Gas (CNG) and household gas pressures declined, creating problems for both sectors. Also, at current electricity rates charging an EV can prove costly since the electricity rate increases as the usage slab increases.
Pakistan is generating a major chunk of electricity through fossil fuels. The electricity consumption will increase with the growth of the EV sector, therefore, indirectly causing an increase in fossil fuel usage. The EVs should be charged using clean energy sources such as solar, wind or biogas. Unfortunately, the renewable energy generation sector is in the infancy stages of development in Pakistan. Another important area of concern is the already existing fossil fuel vehicle industry. The EV policy should be implemented in phases since the current automobile industry provides direct and indirect employment to approx. 3 million people and has contributed revenue of approx. PKR 100 billion per annum. In the initial phase of EV adoption, the Government of Pakistan should start with the conversion of the public mega-transport projects like the Metro Bus, BRT routes in major cities and especially the Pakistan Railway into green transport. Steps should also be taken for facilitating the conversion of existing fossil-fuel vehicles into green vehicles. The EV sector should be developed as the Green Transportation Industry in Pakistan, inculcating the green management principles and practices throughout its life-cycle. It should be connected with the formation of supporting green industries such as green vehicle and spare parts manufacturing units, green supply chain and recycling facilities.
Provision of various subsidies and incentives such as no registration/annual token fee, subsidy on import of spare parts, relief of sales tax, etc by the Government has created an attractive investment potential in the EV sector. The State Bank of Pakistan may play an instrumental role in this regard by categorizing the EV financing under Green Banking. Banks may provide low-interest-rate green financing for the purchase of EV, establishment of green industries related to EV manufacturing, and development of renewable energy based EV charging stations at accessible locations with the help of industrial leaders. Green financing will help in the transformation of Pakistan’s fossil-fuel vehicle industry into a green vehicle industry. The development of local EV industry can make this form of transportation more affordable and accessible for the consumers. It will also boost Pakistan’s green economy through nurturing the banking industry’s green portfolio. The realization of ‘Clean and Green Pakistan’ vision can be assured through Green Banking. The future of Pakistan’s green revolution depends on the development of synergy and singularity of purpose among all concerned stakeholders. Let us start this New Year by reviewing our policies, identifying gaps, bringing in missing partners and synergizing our resources to create a ‘Clean and Green Pakistan’.
—The writer is currently serving as a Senior Manager, Green Banking Officer in Bank Al-Habib Limited, Pakistan.
