The Competition Commission of Pakistan (CCP) has recommended a comprehensive package of fiscal and industrial incentives, including 10-year tax exemptions, subsidized industrial land, export rebates, and local content requirements (LCRs), to promote domestic manufacturing of solar panels.
The recommendations are part of the CCP’s latest study on Pakistan’s solar market, which highlights the country’s near-total reliance on imported solar panels as a key structural weakness limiting long-term affordability, market stability, and competitive growth.
The Commission has proposed the introduction of a Production-Linked Incentive (PLI) scheme, modeled on successful global practices adopted in countries such as India, China, and the United States, to encourage local production, improve efficiency, and attract investment into the manufacturing sector.
Under the proposed framework, manufacturers would receive financial incentives linked to output and performance, creating a competitive environment that rewards scale, innovation, and efficiency.
To further support localization, the CCP has recommended the establishment of dedicated Special Economic Zones (SEZs) for renewable technologies, offering long-term tax relief, access to low-cost industrial land, and reliable infrastructure aimed at lowering entry barriers for investors.
The study also emphasizes leveraging Pakistan’s strategic partnership with China under the China-Pakistan Economic Corridor (CPEC). The Commission proposes joint ventures between local and Chinese firms to facilitate technology transfer, skills development, and rapid scaling of domestic manufacturing capabilities.
Additionally, the CCP has called for export rebates and enforcement of local content requirements to ensure greater value addition within the country, alongside targeted support for research and development to enhance panel efficiency and innovation.
Easy and concessional financing through banks and development finance institutions has also been proposed to address capital constraints faced by potential investors in the manufacturing segment.
According to the CCP, developing a domestic solar manufacturing base would not only reduce import dependence but also create jobs, lower costs over time, and foster a more competitive and resilient energy market.