Charging Ahead: Inside Pakistan’s Electric Transport Plan

News Desk

Islamabad: In a bid to reshape Pakistan’s transport sector and cut reliance on costly fossil fuels, the federal government has rolled out a “Cost Sharing Scheme for Electric Bikes and Rickshaws/Loaders.” Officials describe it as a step toward affordable green mobility—yet it is also one of the most ambitious credit-backed transport initiatives in recent years.

According to figures released by the State Bank of Pakistan (SBP), the scheme will finance about 116,000 electric bikes and 3,170 e-rickshaws/loaders in two phases.

Phase One will see the distribution of 40,000 e-bikes and 1,000 e-rickshaws/loaders.

Phase Two will follow with 76,000 e-bikes and 2,171 e-rickshaws/loaders.

To ensure inclusivity, 25 percent of e-bikes are reserved for women, while 10 percent are earmarked for business users such as delivery riders. For rickshaws/loaders, up to 30 percent will go to fleet operators.

Who Can Apply?

Eligibility extends to all Pakistani citizens, including those from Gilgit-Baltistan and Azad Jammu & Kashmir. The age limit is set between 18–65 years for e-bikes and 21–65 years for rickshaws/loaders.

Fleet operators are also eligible to apply for rickshaw/loader financing, though their applications will be vetted under criteria set by a government steering committee.

Financing the Green Shift

Loans will be available through both conventional and Islamic banking channels. The financing limits are Rs200,000 for e-bikes and Rs880,000 for rickshaws/loaders.

Borrowers must contribute equity under an 80:20 debt-to-equity ratio, but the government is stepping in with a capital subsidy—

Rs50,000 per two-wheeler

Rs200,000 per three-wheeler

This subsidy will first cover the down payment. In cases where the subsidy equals the borrower’s equity share, no additional upfront payment will be required.

Loan tenures extend to two years for e-bikes and three years for rickshaws/loaders. Banks will apply six-month KIBOR plus 2.75 percent, though end-users will not feel this burden since the federal government will bear the full markup subsidy.

For borrowers, the installments will cover only principal and insurance costs.

A Digital, Paperless Model

The government plans to minimize human interaction through a digital application platform. Banks will integrate their systems with a centralized portal managed by the Ministry of Industries & Production and the Engineering Development Board (EDB).

Only vehicle models shortlisted by the EDB will qualify. Applicants must provide a valid CNIC and submit a digital undertaking for a driving license.

Background checks will be covered by the government, using the NADRA database and mobile number portability records. Insurance rates will be negotiated centrally, with the first year’s premium paid upfront.

Consumer Protection

Borrowers must comply with SBP prudential regulations, undergo credit checks, and verify income through salary slips, bank statements, or proxy methods.

The scheme notably waives loan processing charges, early settlement penalties, and repossession fees, though late payment fines will depend on the lending bank’s schedule.

Risk Sharing and Guarantees

Borrowers will cover registration and insurance costs, but the government will share risk through a Credit Loss Guarantee (CLG). A 20 percent portfolio guarantee on a first-loss basis will be available, with claims honored after 180 days of default.

Mandatory documentation will include only a valid CNIC and digital driving license verification.

This scheme, positioned at the crossroads of climate action, financial inclusion, and industrial policy, could redefine Pakistan’s urban mobility. But as distribution begins, the real test will be whether green transport truly becomes affordable and accessible for those who need it most.