Karachi: The Federation of Pakistan Chambers of Commerce & Industry (FPCCI) has expressed approval for the newly sanctioned Auto Policy 2026, endorsed by Prime Minister Shehbaz Sharif. Atif Ikram Sheikh, FPCCI President, described the policy as a significant step towards modernizing the automotive sector, enhancing local manufacturing, and increasing Pakistan's role in the international automotive market.
According to Federation of Pakistan Chambers of Commerce and Industry, the policy aims to integrate the local auto parts industry with global markets, with a plan to attract five major auto-parts manufacturing companies. This move is expected to bolster the manufacturing ecosystem, inviting foreign investment and advanced technology. The policy also outlines the creation of specialized clusters for small and medium-sized enterprises within the automotive sector, which will support local vendors and generate numerous technical jobs.
The FPCCI leadership praised the policy's measures to promote export-oriented production by eliminating duties on equipment and auto parts imported for export purposes. This initiative is expected to reduce manufacturing costs, making Pakistani automotive products more competitive globally. The establishment of an Auto Parts Export Council was also commended as essential for sustained export growth and exploring new markets.
The policy's emphasis on local value addition and digitizing approval procedures with the Engineering Development Board received strong support from FPCCI. The removal of bureaucratic obstacles and allowance of contract manufacturing are seen as steps to improve efficiency and investor confidence. The policy's focus on green technology is also acknowledged as well-timed.
Mr. Sheikh highlighted incentives for New Energy Vehicles and Electric Vehicles, including a 1% sales tax and the removal of several other taxes, which are expected to boost the adoption of clean transportation. Increasing the financing limit for electric vehicles to Rs. 10 million aims to make these vehicles more accessible.
FPCCI pledged the business community's support for the Auto Policy 2026, emphasizing its readiness to facilitate coordination between manufacturers, investors, and regulators to achieve economic revitalization, environmental goals, and industrial prosperity.