Bangladesh is accelerating its transition towards electric mobility through the proposed Electric Vehicle Industry Development Policy 2026, a comprehensive framework designed to increase electric vehicle (EV) adoption, promote local manufacturing, attract investment and position the country as an EV manufacturing nation.

The policy was discussed during a stakeholder consultation held on July 9th and jointly organised by the Ministry of Industries and GIZ Bangladesh in Dhaka. The consultation brought together policymakers, government officials, representatives of the automotive industry, climate experts, international development partners and other stakeholders to review the draft policy and the roadmap for developing Bangladesh's EV ecosystem.

The initiative forms part of the government's broader strategy to reduce greenhouse gas emissions, decrease dependence on imported fuel and establish a domestic EV industry capable of participating in global electric vehicle supply chains.

Policy expected to be finalised this year

According to Md Nuruzzaman, Additional Secretary (Administration) at the Ministry of Industries, the government aims to finalise the long-awaited Electric Vehicle Industry Development Policy within the next three months and complete the process during 2026.

"The industries minister has instructed us to finalise the EV Industry Development Policy in 2026. The policy was originally scheduled to be completed in 2023-24, but it was not. We now aim to finalise it in the next three months," Nuruzzaman said during the consultation.

He added that although the Ministry of Industries is leading the policy formulation process, successful implementation will require coordinated efforts involving relevant ministries, government agencies and private-sector stakeholders.

Officials stated that the proposed policy is intended to support the government's target of achieving 30% EV penetration across transport modes by 2030, in line with the Electric Motor Registration and Operation Guideline 2023.

Bangladesh seeks to become an EV manufacturing nation

Presiding over the consultation, Industries Secretary Abdun Naser Khan stated that Bangladesh must act promptly to capitalise on the rapidly expanding global EV market.

"If Bangladesh fails to prepare adequately today, we will not only miss out on an emerging industrial sector, but also risk falling behind in the Global Value Chain, our target is not merely to become an importer of electric vehicles. Our ultimate goal is to establish Bangladesh as an EV manufacturing nation," Khan said.

Officials stated that the proposed policy aims to establish the legal, institutional, administrative and industrial framework required to support a formal, standards-compliant EV ecosystem while encouraging domestic assembly and manufacturing.

The government views electric mobility not only as an environmental necessity but also as an industrial opportunity that could enable local companies to move beyond vehicle imports and participate in global EV supply chains.

Fiscal incentives proposed to encourage investment

The draft policy includes a range of fiscal incentives intended to promote local manufacturing, assembly and charging infrastructure development. Under the proposal, the total tax incidence (TTI) on imported completely built-up (CBU) electric passenger vehicles and electric motorcars will remain fixed at 37% until 2030.

For vehicles imported in completely knocked-down (CKD) form, the TTI will be fixed at 15.25% until 2035, providing a significant tax advantage intended to encourage domestic assembly and manufacturing activities. The policy also proposes a 10-year income tax exemption for businesses and institutions establishing EV charging stations as part of efforts to accelerate the nationwide deployment of charging infrastructure.

Officials from the Ministry of Industries stated that the Power Division and the National Board of Revenue are working on complementary measures to encourage both public and private investment in EV manufacturing and infrastructure development.

Transport emissions driving the transition

Government officials and participants at the consultation highlighted the importance of transport electrification in achieving Bangladesh's environmental objectives.

According to officials, road transport accounts for approximately 81% of emissions generated by the country's transport sector, making the transition to electric mobility a key component of Bangladesh's climate strategy. The proposed policy is therefore intended to support both emissions-reduction and industrial-development objectives simultaneously.

Power grid readiness and infrastructure development

The consultation also reviewed Bangladesh's preparedness for the increased electricity demand expected to result from wider EV adoption. Participants were informed that the national electricity grid would be capable of accommodating rising EV demand through targeted grid planning, smart charging systems and the gradual deployment of smart-grid technologies.

Officials stated that electricity generated from low-carbon sources accounted for approximately 2% of Bangladesh's total power generation in 2025. Despite this, the authorities believe that the country's power infrastructure can support large-scale EV adoption through ongoing grid improvements and technology deployment aimed at maintaining network stability as electricity demand increases.

International support and stakeholder collaboration

Representatives from the German Embassy and Deutsche Gesellschaft fur Internationale Zusammenarbeit (GIZ) Bangladesh reaffirmed Germany's support for Bangladesh's transition to sustainable mobility through the Transition to Sustainable e-Mobility (Trans2SMo) project. The programme is providing technical assistance to the Ministry of Industries in the development of the Electric Vehicle Industry Development Policy.

The Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ, 'German Society for International Cooperation') is the main development agency of Germany. GIZ is working in Bangladesh on behalf of the German Federal Ministry for Economic Cooperation and Development and the European Union (EU). The priority areas of cooperation are:

- Energy, climate and urban development
- Sustainable economic development, education and employment
- Conserving biodiversity

Mark Gombert, Country Director of GIZ Bangladesh, stated that Bangladesh has an opportunity to establish a competitive and sustainable electric mobility industry through coordinated policymaking, investment and public-private collaboration.

He also reaffirmed Germany's continued support through GIZ's technical and advisory assistance to the ministry. Additional Secretary (Policy, Law and International Cooperation) AKM Benjamin Riazi and Additional Secretary (Administration) Md Nuruzzaman also addressed the consultation.

Officials stated that, before the policy is finalised later this year, the Ministry of Industries will continue consultations with the Power Division, the Road Transport and Highways Division, the Bangladesh Road Transport Authority, the National Board of Revenue, the Local Government Division and other stakeholders to ensure the coordinated implementation of the country's EV development strategy.