Faiza Tehseen

Pakistan needs to roll out bankable sectoral strategies to attract climate finance, Muhammad Saleem, media spokesperson for the Ministry of Climate Change and Environmental Coordination, said this while talking exclusively to WealthPK.

“Ranked among the most climate-vulnerable countries, Pakistan urgently needs substantial financial resources to implement effective climate strategies focusing on agriculture, water, energy, health, and education. Concerning mitigation, climate finance involves funding initiatives to reduce greenhouse gas (GHG) emissions. Regarding adaptation, climate finance helps communities cope with the shifting weather patterns and its adverse impacts on various socio-economic sectors.” He said that despite contributing minimally to global emissions, Pakistan faces disproportionate climate impacts.

So, climate finance is vital for the country to implement resilience-building projects, promote sustainable development and protect the vulnerable population. “Despite international commitments, a significant gap persists between the required climate finance and the available one. Recently, at the UN climate conference, a commitment was made to pay US$300 billion per annum by 2035, but it was only a fraction of the estimated US$1 trillion per annum, required by the developing countries to address climate commitments,” he said.

“The said shortfall in the climate funding gap indicates the need for an increase in climate finance and it should be managed as a grant, not as a loan. Otherwise, it will become another burden for the countries already facing the worst climate impacts and under an unbearable burden of foreign debt,” Saleem said. Recently, the government launched its first National Climate Finance Strategy (NCFS) to combat environmental challenges. The main purpose of this strategy was to mobilise financial resources for both climate mitigation and adaptation efforts.

NCFS will prove itself a milestone in Pakistan’s commitment to the Paris Agreement. It will provide a roadmap to systematically secure climate finance for the targeted errands. To fulfil this task, the possible supporting financial bodies may include the domestic financial systems, international climate finance agencies, and private sector. Saleem further told WealthPK that to leverage various financial instruments concerning climate resilience activities, NCFS will also help identify sectoral priorities.

It will also accompany the national flow of climate finance. Input from all the stakeholders will also be a part of it. About 33 million people were directly affected by floods in 2022. The calamity caused socio-economic loss of US$ 30 billion. NCFS will also help bridge the climate finance gap Pakistan faces. The gap is estimated to be US$348 billion by 2030 to achieve climate resilience and low carbon goals. The ministry official said, “Under NCFS, a climate finance framework will be aligned with the smart economic approach to allocate resources for the most vulnerable climate sectors and communities.

Pakistan’s Climate Resilience Vision 2050 encompasses resilient infrastructure, agriculture, climate smart cities, and ecosystems. To effectively manage climate finance, Pakistan needs to foster public-private partnerships, and integrate climate change adaptation and mitigation strategies into macro-fiscal policies. There is also a dire need to scale up climate-smart technologies.” The recent funding pledges and requests indicate progress, but substantial challenges have yet to be addressed.

To bridge financial gap and to build a climate-resilient future along with the domestic strategies, Pakistan needs enhanced international cooperation to be climate-resilient, he added. Talking to WealthPK about the importance of climate finance and its proper management for successful climate mitigation and adaptation efforts, Dr. Muhammad Akbar, an environmentalist from Gilgit-Baltistan (GB), said, “At the global climate risk index, Pakistan ranks among the top 10 countries considered most vulnerable to environmental changes.

The country is regularly facing extreme weather events including floods, heatwaves, and glacier melt (also causing and increasing the risks of glacial lake outburst floods (GLOFs).” He said without sufficient funds, Pakistan spends billions annually in recovery efforts after the natural disasters. To tackle these issues, development funds are also used, due to which the economy suffers, hindering long-term growth and poverty alleviation.

So, to address the adaptation and mitigation needs, Pakistan requires significant funding from international agencies.  Sufficient climate finance is not only a necessity but also a matter of survival for Pakistan. It will make the country more active and crucial in meeting the global climate goals and securing a sustainable future for its citizens. To leverage effective domestic policies and effective climate finance management, collaboration of all the stakeholders at both national and international levels is direly needed.

Credit: INP-WealthPk