Pakistan Unveils Ambitious Carbon Market Policy to Tackle Climate Change
— December 28, 2024
ISLAMABAD (AIA) In a historic move to combat climate change, Pakistan’s Federal Cabinet has approved the nation’s first-ever Carbon Market Policy. Spearheaded by the Ministry of Climate Change and Environmental Coordination, the policy represents a bold step toward aligning the country’s development goals with global climate commitments under the Paris Agreement.
The policy outlines a framework for operationalising carbon markets in Pakistan, targeting key sectors such as energy, agriculture, waste management, and forestry to achieve emissions reductions. According to a spokesperson from the Climate Ministry, the initiative aims to attract domestic and international investments while prioritising social equity and environmental integrity.
Built on three key pillars—environmental integrity, economic development, and equitable benefit sharing—the policy ensures that carbon market projects produce measurable and verifiable emission reductions while delivering economic and social benefits to local communities. The ministry also emphasised simplified approval processes and minimal fees to encourage investor participation.
A Corresponding Adjustment Fee (CAF) allocates 12% of net revenues to provincial and national climate funds, while 5% of the credits generated will count toward Pakistan’s voluntary climate commitments.
The initiative has garnered support from global organisations, including USAID, the World Bank, UNEP, and GIZ, which are collaborating with Pakistan to build robust carbon market regulations, a carbon registry, and a project pipeline. Federal officials anticipate that these partnerships will mobilise capital and expertise, driving impactful actions toward climate resilience.
“This policy marks a decisive step forward for Pakistan’s climate ambition. It’s a call to action for both domestic and global partners to join hands in creating a resilient, low-carbon future for Pakistan