Islamabad: The federal government has approved the second phase of the Pakistan Accelerated Vehicle Electrification (PAVE) Programme under the New Energy Vehicles (NEV) Policy 2025–30. Under this initiative, electric bikes, loaders, and rickshaws will be distributed on a first-come, first-served basis.
According to News Reports, The Economic Coordination Committee (ECC) of the federal cabinet has approved a package worth Rs. 9.0 billion for the fiscal year 2025–26. The scheme will operate on a revenue-neutral model, financed through the NEV Adoption Levy Act 2025.
For the current fiscal year, the programme targets the distribution of 119,170 vehicles, including 116,000 electric bikes and 3,170 rickshaws and loaders. Following the completion of an initial pilot phase involving 41,000 vehicles, the revised second phase now aims to distribute 76,000 electric bikes and 2,170 rickshaws and loaders.
In addition, the ECC is expected to approve a fast-track rollout of 100,000 electric bikes within a three-month period. The programme will utilise approximately 130,000 Completely Knocked Down (CKD) kits that are either available domestically or currently in transit.
A fixed subsidy of Rs. 80,000 per electric bike will be provided directly to pre-qualified original equipment manufacturers (OEMs). Distribution will be carried out in 200 batches, each comprising 500 units.
Officials estimate that this initiative will result in short-term fuel savings of approximately 8.6 million litres of petrol, valued at around USD 8 million. Over a five-year period, projected savings are expected to reach USD 222 million.
As part of the programme, the government will also distribute 600 electric bikes free of cost to top-performing students who secured first, second, and third positions in the 2025 Higher Secondary School Certificate (HSSC) examinations across all 26 Boards of Intermediate and Secondary Education. This initiative is estimated to cost approximately Rs. 150 million, based on an average price of Rs. 250,000 per bike.
To enhance efficiency and address delays observed during the first phase, the steering committee has recommended replacing the balloting system with a first-come, first-served mechanism. Priority will be given to applicants who were previously waitlisted in Phase 1, based on precise application timestamps.
The subsidy disbursement mechanism has also been revised. Instead of requiring full upfront payments, buyers will now pay the reduced price after subsidy deduction. The Engineering Development Board (EDB) will transfer subsidy amounts directly to OEMs through the State Bank of Pakistan, subject to verification of vehicle delivery and registration.
A revised self-financing scheme has been introduced for federal employees in Basic Scale (BS) 16 and below. This scheme requires minimal down payments of Rs. 10,000 for electric bikes and Rs. 100,000 for rickshaws, with the remaining balance to be recovered through interest-free payroll deductions over a period of 6 to 18 months.
The programme’s accessibility has also been expanded to include institutional financing, housing-linked public-private partnerships, overseas Pakistanis holding NICOP or POC cards, SECP-registered non-banking financial companies (NBFCs), and fleet operators.
Furthermore, the previously mandatory 100 percent third-party verification system has been replaced with a risk-based verification model. This updated approach incorporates biometric authentication, photographic evidence, and digital validation through the programme’s online portal. The revision follows concerns over high verification costs, which exceeded Rs. 500 million during Phase 1.
To support implementation, the EDB will establish a dedicated 14-member unit at an annual cost of Rs. 32.76 million. Additionally, Rs. 37 million has been allocated for operational expenses for the fiscal year 2025–26.
During Phase 1, the programme received 269,149 applications, reflecting strong demand despite limited banking approvals. Notably, the self-financing segment achieved a delivery success rate of 99.6 percent.
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