Effectiveness of Electric Vehicle Policies and Implications for Pakistan

This report explores evidence from several key countries regarding the impacts of electric vehicle (EV) market penetration from financial incentives, road access policies, EV mandates, fuel taxes, discounted electricity rates, charging infrastructure, and government investment in the domestic automotive industry.

This report reviews EV policies in countries that have demonstrated success deploying EVs or promoting local EV production, focusing on Norway, China, the United States, India, Korea, Thailand, Indonesia, the Philippines, and Vietnam. The report is targeted toward Pakistan, which is in the process of adopting EV promotion policies, but it is applicable to policymakers throughout the world.

Several lessons are apparent from the EV policies in these focus countries: 

  • Financial incentives are very impactful
  • Granting exclusive access to EVs can make electric vehicles very popular. 
  • Mandates on automotive manufacturers to sell EVs can be used to shift the financial burden to subsidize the vehicles 
  • Gasoline prices are significantly correlated with EV adoption
  • Electricity rate discounts may be less effective 
  • Lost revenue from gasoline taxes may reduce funding for roads 
  • Charging infrastructure has an outsized impact on early adopters
  • Policies favoring domestic manufacturers have proven effective EV development

While certain policies have proven effective in specific countries, it is important to consider exogenous variables, such as median household income, vehicle market, and political regime, that might impact EV policy and success in Pakistan. While this report does not examine those factors in detail, it examines EV policies on a country-by-country basis to provide context that might otherwise be omitted. 

Read the report, here!  

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