Policy as a catalyst in shaping mobility sector transition for developing countries

Abstract

Abstract This paper presents a modified technology innovation system (MTIS) approach applicable to developing countries. Evidence collected over three decades 1992–2022, shows how policy plays a catalytic role in managing multidimensional low-emission mobility transitions in developing countries such as Pakistan. This paper follows policy and the network of actors, institutions and technology in compressed natural gas (CNG)-based mobility transition in Pakistan. Event-based analysis helped in mapping the development of respective functions, which is later validated by expert consultation. Between 1992 and 2002, deliberate policies for early adoption were put in place to strategically manage a desired transition path. This involved providing guidance and knowledge diffusion through demonstration to increase entrepreneurial activities and market formation. The accelerated diffusion during the take-off period during 2003–2012 was due to the entry of private businesses and multinational companies speeding up entrepreneurial activity and market-formation functions. However, there was a clear policy-driven roll-back and deceleration during 2013–2022. Policies designed to ban CNG licence issuance and renewal resulted in detrimental effects on market and entrepreneurial activities. Social struggle arising from roll-back is now caught in a dilemma if policy innovation will lead to re-emergence of CNG or will support a new transition cycle through the emergence and adoption of electric vehicles in the mobility space of Pakistan. Rapid shifts in the global landscape of innovation and market conditions are creating a need for the effective handling of cascading transition management in developing countries. This paper outlines how lessons learnt from Pakistan’s CNG-MTIS can help in shaping electric vehicle MTIS not only in Pakistan, but also in many other developing countries. It is recommended that, in order to manage cascading transitions in developing countries, new approaches and strategies for reskilling, retraining and redirecting finances to address stranded assets be employed. This can mitigate the negative impacts on those affected by transformation and create an environment for a just transition that restores trust in policy and accelerates transformative change.