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Solar Panel And Allied Equipment Manufacturing Policy


The Engineering Development Board (EDB) is all set to submit
its policy document on Solar Panels and Allied Equipment’s
Manufacturing to the Government by the end of this month. EDB
initiated working on this policy formulation some time back under
directions from its parent ministry, the Ministry of Industries &
Production and the EDB’s Board of Management. Over the last few
months, extensive consultations have been held with stake-holders
which include local manufacturers of solar panels, provincial energy
departments, research organizations, academia, users, and other
relevant organizations & departments in the federal and provincial
governments. The draft policy was presented in the 51st Board of
Management meeting of EDB held in June 2022 and EDB was
advised to hold a consultative workshop on the matter before
submission of the policy document to the government. The Policy is
expected to dovetail with the national solar energy policy being
prepared by the Ministry of Power and the Renewable Energy Task
Force under the leadership of the Prime Minister of Pakistan.
Today , Pakistan, is facing serious energy shortages with record
prices that had directly and indirectly affected all sectors of the
economy .The country’s electricity demand has reached almost
29,000 MW total whereas generation is about 22,000 MW creating a
considerable gap between generation and demand, resulting in load
shedding. With the present Government’s focus on setting solar set
ups it becomes imperative to promote localization & indigenization
of solar panels and its allied equipment in the country to save huge
out flow of foreign exchange.
The country’s power sector has a structural issue as its energy
generation mix is 40% based on indigenous resources while 60%
comprises imported oil fuel. The government has planned to increase
local share to 90% by 2030, out of which the targets set for
renewable energy is 20% to 30% which is currently around only

1.4% of the total installed capacity. Roof top solar system in
particular needs to be encouraged and incentivized as it is the
cheapest source of electric generation available today. In anticipation
of the upcoming government policies for incentivizing renewable,
especially solar energy, local industry has already made huge
investment for building local manufacturing capability and capacity
for solar panels and allied equipment whereas several other local as
well as foreign investors are waiting for the appropriate policies to
come out before they invest on the ground. Local manufacturing of
solar panels and allied equipment not only saves valuable foreign
exchange through localization, but also brings in investment and
provides skilled job opportunities for engineers and technicians.
The industry is currently using imported raw materials,
however in the coming years once local volumes build up, the
industry is planning to use local raw materials to further bring costs
down and decrease the country’s import bill. Glass and Aluminum
frame for the Panels in particular can easily be manufactured in
Pakistan due to the strong presence of this allied industry within the
country. If the industry is able to meet local demand for solar panels
in line with the government’s plans, the expected volumes can bring
local manufacturing costs down to a level where exports can also be
generated from the sector.
EDB has invited the panel manufacturers, provincial energy
departments, local EPC contractors, solution providers, foreign
consultants working in this field, research organizations, Academia,
users, and other relevant organizations / departments in the
federation. The highlights of the draft policy document shall be
shared in the workshop to get inputs from the stakeholders for
firming up the requisite recommendations.

Photovoltaic solar panels installation and blue sky with few clouds
BoM

51st  MEETING OF EDB BOARD OF MANAGEMENT

51st Meeting of EDB Board of Management was held on 20th June, 2022 at NFC Lahore under the chairmanship of Mr. Almas Hyder and attended by majority of the Board Members.

CEO-EDB briefed the Board on progress on assignments discussed in the previous Board meeting. He briefed on the development activities in respect of AIDEP (2021-26), Mobile Device Manufacturing Policy, Solar Panel and Allied Equipment Manufacturing Policy and Agriculture Implements Manufacturing Policy.

The Board was apprised that AIDEP encompassed promotion of small cars, promoting localization, incentivizing introduction of new products in tractors and motorcycles segments, consumer protection, promotion of new technologies i.e. EVs and Hybrids, export targets for OEMs etc. Major achievements include issuing EV manufacturing license issued to (10)ten 2/3 wheeler companies, updation of SRO 693(1)2006, implementation of WP-29 Safety Regulations through legislation w.e.f. July 01, 2022, payment of late delivery charges by OEMs to customers @ KIBOR + 3 percent. It was further informed that EDB has taken up the unimplemented recommendations of AIDEP with FBR.

The Board appreciated the success of Mobile Manufacturing Policy under which in the very first year, i.e. 2021, 70% handsets were manufactured locally whereas in the first four months of current year, i.e. Jan-Apr 2022, local manufacturing of mobile phones has reached 92% of total handsets sold in the country. He informed that the mobile manufacturing companies are facing problems in import of CKD/SKD due to recent restrictions by State Bank of Pakistan for establishing letter of credit which may result in halting of operation and even shut downs. The Board directed to take up the matter with concerned quarters on priority basis.

The Board was also informed that EDB has initiated the work on formulation of Policy to promote local manufacturing of “Solar Panels and Allied Equipment Manufacturing” and “Agricultural Machinery and Implements Manufacturing”. Several meetings, in this regard, have been held with the concerned stake-holders at federal and provinces levels to get suggestions for the proposed policies. Accordingly, based on the inputs / comments Policy documents are being finalized. The Board advised to hold consultative workshops on these policies in order to benefit from collective wisdom of concerned stakeholders.

 

 

MEETING ON MEDICAL DEVICE MANUFACTURING POLICY

A meeting was held on 29th July, 2022 in Lahore SMEDA office to define future policy framework for development of   Medical Device Manufacturing in Pakistan. The meeting was attended by representatives of EDB, NPO, TUSDEC, SMEDA and PBC. CEO-EDB highlighted that existing surgical instruments industry has multiple issues relating to branding, productivity, certification, MDR compliance, etc and suggested a coordinated approach to address their issues to increase their competitiveness and exports. Pakistan Business Council (PBC) gave a presentation on the joint EDB-PBC study on “Enhancing the Competitiveness of Pakistan’s Surgical Instruments Industry.” Subsequently GM (BDG)-EDB shared the policy brief highlighting the world scenario and Pakistan’s position, major imports of medical equipment under various H.S Codes and the proposed policy framework for import substitution and export enhancement. CEO SMEDA opined that the issues of the existing surgical instruments industry need to be dealt separately from the futuristic scenario of enabling development of a local Electro-Medical Device industry, while ensuring the engagement of SIMAP in both exercises. CEO-NPO offered to help the industry to improve productivity issues alongside improving wastages & rejections highlighted in the study. Director TUSDEC opined that new players in electro medical devices require being encouraged to enter this sector. Provincial Chief, SMEDA stressed the importance of addressing the MDR issue for exporters and countering the reverse trade problems in the sector. CEO-EDB also highlighted that development of a local Electro-Medical Device industry requires extensive consultation for which a National Consultative Workshop may be arranged so that all pertinent stakeholders should brainstorm and come up with a way forward.

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ribbon cutting

EDB ATTENDS PAKISTAN AUTO SHOW 2022

The Pakistan Auto Show, organized by the Pakistan Association of Automotive Parts & Accessories Manufacturers (PAAPAM), was held from 29th July to 31st July, 2022 at Lahore International Expo Centre. The three day event showcased the entire Auto engineering sector under one roof.

Syed Murtaza Mahmud, Minister of Industries & Production inaugurated the Auto Show 2022. The ribbon cutting ceremony was attended by Mr Almas Hyder Chairman EDB, Mr Raza Abbas Shah, CEO-EDB, Chairman and office bearers of PAPAM and renowned business leaders. A number of speakers highlighted different aspects of auto industry i.e. role of OEM’s in capacity building, electric vehicles and tractor industry, price competitiveness and indigenization of automotive industry. The various stalls showcased cars, motorcycles, commercial vehicles and automotive parts which are manufactured in Pakistan. Engineering Development Board also participated in the event by setting a stall for general Information and facilitation for engineering industry as well as for specific guidance with reference to AIDEP (2021-26).

Minister of Industries & Production assured the industrialist regarding all possible government support to resolve the issues related to auto sector. Chairman EDB spoke about the need of local raw materials, machine and tools and highlighted that if industry wants to remain stable against the volatile political and economical situation of the country then the auto parts manufacturers have to increase the exports. It is made obligatory in the AIDEP (2021-26) to export as a ratio of total import by an OEM’s. CEO-EDB highly appreciated PAAPAM for introducing the automotive market’s most recent technology, services, and solutions, as this exhibition provides excellent opportunities for leading brands and automotive accessories.

MEETING ON FREQUENT PRICE INCREASE BY LOCAL AUTOMOBILE MANUFACTURERS/ASSEMBLERS

A meeting of Auto Industry manufacturers was convened under the chairmanship of CEO-EDB on 3rd August, 2022.The Meeting was attended by Joint Secretary LED-MOIP, GM-Policy-EDB and representatives of OEMs . The purpose of the meeting was to discuss matter of frequent price increases, progress on compliance to WP-29 Regulations, bookings & late delivery issues and exports.

CEO-EDB informed that Government is receiving numerous complaints due to price increases and consumers continue to suffer from delayed deliveries. Auto industry representatives were of the view that recent price escalation factors included PKR depreciation against USD, rise in freight cost, increase of input material cost in international market, and increase in cost of doing business. All these factors have a compound effect, which is causing continuous increase in prices of locally manufactured vehicles. CEO- EDB acknowledged that these factors have contributed to overall price hike however a mechanism of sharing of price revisions with EDB needs to be put in place whereby OEMs may share justification with EDB whenever they are constrained to increase prices.

The issue of non-compliance of AIDEP 2021-26 booking guidelines and late delivery of vehicles was discussed in the meeting and it was decided that  OEMs/Association to present their comprehensive proposals on booking & delivery mechanism for consolidation by EDB and discussion in next meeting to be chaired by Secretary MoIP.

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MEETING ON THE PREPARATION OF IMPORT SUBSTITUTION ITEMS FOR REVERSE ENGINEERING

A meeting on localization of engineering goods through reverse engineering was held on 11th August, 2022 at EDB which was attended by representatives of EDB, TUSDEC, KTDMC and PITAC. The objective of the meeting was to prepare a list of items for import substitution. General Manager EDB highlighted that after the import of petroleum products, Pakistan imports a huge volume in electrical machinery, power generation equipment, transport equipment, plastic material, and in Iron & Steel.

Different steps are involved in reverse engineering i.e. information extraction, modeling through CAD & CAM, testing and review. Agricultural machinery, surgical implants and electro medical devices are the area where import substitution can be done for which 3-D printing facility can be utilized to get the prototype of reverse engineering. During the meeting, sectors were identified where imports can be substituted through local production through the process of reverse engineering. However, there is a need of feedback from local manufacturers/association for exploring the possibility of localization and capacity enhancement in the areas of import substitution.

 

 

 

MEETING ON SUPPORT FOR ENHANCEMENT OF PRODUCTIVITY AND EXPORTS OF SURGICAL INDUSTRY

A meeting on Support for Enhancement of productivity and Exports of Surgical Industry was held on 12th August, 2022 at SIMAP office, Sialkot. The meeting was attended by President and senior officials of SIMAP, CEO EDB, CEO NPO, Provincial Chief SMEDA, GM TUSDEC and other officials.

CEO-EDB informed that the Federal Minister for Industries & Production has desired that the four MoIP organizations (EDB, NPO, SMEDA and TUSDEC) to should jointly work with the surgical industry to address their issues and support the surgical devices industry to improve its productivity and exports.

President of SIMAP informed that the industry has been adversely affected by the unilateral decision of the government to reduce Duty Drawback rates from 4.86% to 1.58% and submitted their proposals to IOCO for enhancement of the same to 8.9%.CEO-EDB informed that they have also taken up with M/o Commerce to provide DLTL to this industry as is being done for other major export oriented sectors.

Some of the issues identified by the industry included MDR Training & Compliance, Laboratories & Certification, Productivity improvement, Common Facility Centre, Marketing & Branding, Exhibitions, National Expo, Surgical City & EPZA.

It was decided that SIMAP should submit a comprehensive proposal addressing all the issues mentioned in the meeting which would then be taken up with concerned government ministries and departments for resolution. SMEDA and TUSDEC would jointly meet PCSIR to ascertain their capability and readiness to support the comprehensive testing requirements of the industry. The President of the Association appreciated the efforts of EDB and other organizations in facilitating the surgical industry which is expected to lead to greater value addition, imports substitution, employment generation and export enhancement.

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3rd CEO’s Committee Meeting

The 3rd meeting of CEO’s Committee was held on 15th August, 2022 at Ministry of Industries & Production, Islamabad, chaired by the Federal Minister for Industries & Production. Meeting was attended by Parliamentary Secretary for I&P, Secretary I&P, Chairman EDB, senior officials of I&P and CEOs.

Secretary I&P gave background and rationale behind constitution of CEO’s Committee and emphasized on its regular meetings to facilitate the working of I&P Division. CEO EDB gave an overview of the decisions of the 2nd CEO Committee meeting related to EPZA, productivity improvement initiatives for surgical and cutlery sectors, feasibility of revival of Pakistan Gems & Jewelry Company, import substitution through reverse engineering, Medical device industry and export enhancement of Potato starch and Mango pulp.

Federal Minister advised that alternate export destinations of surgical industry be explored and many Central Asian states are interested to import surgical instruments from Pakistan. He mentioned that there was a gap between our industry and Commercial Councilors posted abroad which needs to be bridged in order to facilitate Pakistani exporters’ access to these foreign markets. He appreciated the idea of a national expo on Surgical/Medical devices, however he advised to also identify potential countries for trade shows in collaboration with TDAP. Federal Minister also directed to involve all stakeholders including TDAP in the proposed workshop on medical devices industry.

Chairman EDB remarked that for import substitution areas Electrical power equipment, solar, agricultural implements and mobile phone manufacturing have huge potential. Local demand for electricity would be around 50,000 Mega Watts in the coming years. He requested support of the Minister for supporting PC-1 prepared for addressing equipment needs of  Rawat Lab which has a critical role in the meeting the testing requirement of the industry.

The Federal Minister also desired proposals for reducing barriers to entry in different industrial sectors. He showed keen interest in localization of Agriculture Implements and Solar Panels and desired EDB separately present what has been done so far in this regard.

It was decided that the next CEO committee meeting would be on September 05, 2022 at Sialkot to specifically focus on issues of industry there. Concerned departments i.e. EDB, TUSDEC, NPO, SMEDA, and EPZA will attend. In addition provincial departments like Punjab Small Industrial Corporation, TEVTA, NAVTEC, and district administration officials may also be invited to attend.

 

2nd MEETING OF AUTO INDUSTRY DEVELOPMENT COMMITTEE

The 2nd meeting of the Auto Industry Development and Export Committee (AIDEC) was held on 16th August, 2022 at Engineering Development Board under the chairmanship of Mr. Raza Abbas, CEO- EDB.

Syed Murtaza Mahmud, Honorable Minister for Industries and Production also graced the occasion with his presence. Meeting was attended by senior officials from Engineering Development Board (EDB), Federal Board of Revenue (FBR), Pakistan Association of Automotive Parts and Accessories Manufacturer (PAAPAM), Higher Education Commission, Ministry of Commerce and Ministry of Science & Technology along with representatives from automotive industry.

CEO-EDB informed that Government is receiving numerous complaints due to price increase by various OEMs and lack of safety features in the locally manufactured vehicles. Auto consumers of Pakistan continue to suffer from delayed deliveries, frequent price revisions, menace of premium on money and lack of choices among affordable cars in the market. Auto Industry representatives were of the view that factors for price increases are Pak Rs. depreciation, increase in freight costs, increase in prices of raw materials and enhancement of taxes by government, in particular FED. All these factors have a compound effect, which is causing continuous increase in prices of locally manufactured vehicles.

Syed Murtaza Mahmud, Minister of Industries and Production remarked that Pakistan is passing through challenging times and the government has taken measures to control trade deficit. However, PKR is appreciating again due to government efforts and industry should accordingly consider decrease in prices. Secretary AIDEC informed the house that few companies have recently decreased prices which sent a positive signal and that similar steps are expected from other OEMs. He added reduction in prices due to decrease in input cost is a positive step for customer welfare.

The Federal Minister emphasized that Pakistan cannot depend on imports. He explained that Uzbekistan has only one automotive manufacturer and they are making high value parts like engine, transmission etc. Pakistan needs to focus on import substitution and export enhancement. The Federal Minister asked EDB to coordinate with PAAPAM & PAMA and submit proposal for localization and exports of high value added parts as well as safety features compliance report to the Ministry by 31st December, 2022 for implementation in Finance Bill.