Amir Khan

China has firmly established itself as a global leader in EV technology, providing an opportunity to the Pakistani auto industry to leverage this momentum for its growth. Talking to WealthPK, Aisha Moriani, Additional Secretary at the Ministry of Information Technology and Telecommunication, said Pakistan's automotive industry faced both opportunities and obstacles due to the increasing influence of China in the electric vehicle (EV) market. “China's expertise in producing smart and affordable electric cars presents an attractive prospect for Pakistan's auto sector, offering potential for collaboration, technology transfer, and investment,” she noted. She pointed out that one key benefit for Pakistan's auto sector lay in the prospect of the Chinese companies viewing the country as a strategic investment destination. As China expands its global footprint in EV production, Pakistan emerges as a potential manufacturing base due to its geographic proximity and favourable economic conditions, she observed.

She said the Chinese automakers seeking to circumvent trade restrictions or tap into the emerging markets could find Pakistan as an attractive option. This could lead to joint ventures (JVs), technology transfers, and localized production, thereby bolstering Pakistan's automotive industry and creating employment opportunities. The allure of Chinese EVs lies in their superior quality and competitive pricing, reflected in Europe's adoption rate surging from 0.5% in 2019 to over 9% last year. Talking to WealthPK, Muhammad Imran Hyder, Director General of National Information Technology Board (NITB) highlighted that Pakistan's auto sector could potentially leverage China's progress in battery technology, a vital aspect of electric vehicles (EVs). He further said that by accessing the Chinese expertise, Pakistani manufacturers had the opportunity to bolster their proficiency in battery manufacturing and integration, which is crucial for fostering the competitiveness of domestic electric vehicle development.

“Collaboration with the Chinese firms in research and development initiatives could accelerate the pace of innovation in Pakistan's auto industry, enabling it to remain globally competitive in the evolving EV landscape,” he noted. However, despite the opportunities presented by China's EV market dominance, Pakistan faces significant challenges in fully capitalizing on this potential. Lack of strong charging infrastructure and low domestic demand for electric vehicles pose hurdles to attracting substantial investment in EV manufacturing. Without addressing these fundamental issues, Pakistan may struggle to position itself as a preferred destination for Chinese EV production. Thus, while the rise of Chinese EVs offers a promise for Pakistan's auto sector, navigating the complexities of infrastructure development and market demand will be crucial for realizing its full benefits.

Credit: INP-WealthPk