EV Import Duty Cut Proposed from 89% to 37% in New Draft Policy
News Summary
Bangladesh's Ministry of Industries drafted a new Electric Vehicle (EV) policy to boost adoption, reduce emissions, and attract local manufacturing. Key proposals include: Cutting EV import duty from 89.08% to 37%. Reducing duties on imported EV components for assembly to 15.25%. Waiving AIT and halving registration fees until 2030, plus offering up to 8-year bank loans covering 60% of the cost. Setting a target for 30% of government/corporate vehicles to be electric by 2030. Industry experts project a 20-25% EV price reduction if implemented. The policy also includes a council for oversight and incentives for exports.
* This summary was assisted by using AI
The Ministry of Industries has drafted a new policy to promote electric vehicle (EV) adoption and manufacturing in Bangladesh, proposing a major reduction in import duties — from 89.08% to 37% — alongside export incentives and other financial benefits.
The policy aims to make EVs more affordable, reduce carbon emissions, and attract global automakers to invest locally. It also outlines plans to form a 32-member Electric Vehicle Industry Development Council to oversee implementation.
Under the proposal, the duty on imported EV components for local assembly will drop to 15.25%, while the duty on lithium-ion battery production materials is set at 26.20%.
“If implemented, the policy could reduce EV prices by 20–25%, expand the market, and bring foreign investors,” said Imran Zaman Khan, Divisional Director at RANCON Motors.
Buyers will also benefit from easier financing — with bank loans covering up to 60% of a vehicle’s cost and repayment terms of up to eight years. Additionally, registration fees may be halved and advance income tax (AIT) fully waived until 2030.
To support local manufacturing, the policy includes bonded warehouse facilities and cash incentives for EV and component exports.
According to NBR data, 178 electric cars were imported in FY 2024–25, up from 77 the previous year. In the first three months of FY 2025–26, 30 units have already arrived. Globally, EV sales crossed 17 million in 2024 — a 25% increase from the previous year, according to the International Energy Agency (IEA).
“Lower tariffs will encourage imports of new EV models,” said Imtiaz Naosher, Chief Marketing Officer of BYD Bangladesh.
The draft also sets a goal for 30% of government and corporate vehicles to be electric by 2030, alongside reducing dependency on fuel-based transport.
“Currently, raw materials and components for EV production face about 61% total tax,” said Mir Masud Kabir, Managing Director of Bangladesh Auto Industries Ltd. “We expect this new policy to ease the tax burden and stimulate local production.”
Bangladesh Auto Industries Ltd., the country’s first EV factory, has completed construction in Chattogram’s National Special Economic Zone with a Tk 1,440 crore investment, awaiting a gas connection to begin production.
“We’ll consult NBR, BUET experts, and industry stakeholders through November and December,” said Rashidul Hasan, Additional Secretary at the Ministry of Industries. “The final policy will be approved as soon as possible.”
