National Climate Finance Strategy (NCFS)

Pakistan’s vulnerability to climate change necessitates a robust financial strategy to support adaptation and mitigation efforts. The National Climate Finance Strategy (NCFS) provides a comprehensive framework for mobilizing and deploying climate finance, aligning with national priorities and international commitments. The strategy recognizes the escalating costs of climate change and the even higher price of inaction, emphasizing the need for a coordinated approach to create fiscal space for climate-resilient and low-carbon development. The Strategy aims to identify key climate investment sectors including renewable energy, agriculture, water management, disaster resilience, sustainable urban development, solid waste management and to implement and leverage key climate finance sources including public, private, local and global climate finance. It also sets annual climate finance targets which need to be implemented vigorously.

Green Climate Fund (GCF)

The GCF, established under UNFCCC, is the world’s largest climate fund. Pakistan has a current funding of 304.2 Million USD in ten different approved projects to help in achieving its NDC targets. Since GCF operates through accredited entities, Pakistan is currently seeking to expand the number of its accredited entities with the GCF Secretariat from two i.e JS Bank & NRSP to ten which will lead to a high volume of GCF funding per year.

The Green Climate Fund (GCF) is a fund within the framework of the UNFCCC, which envisages the mechanism to redistribute the money from the developed to the developing world. This money is meant to assist the Developing Countries in adaptation and mitigation efforts to counter effects of Climate Change. It is governed by a Board of 24 members and supported by a Secretariat. The Fund also provides support for readiness and preparatory activities to enhance country ownership.

The further detail on the ongoing approved projects in Pakistan can be found here .

Pakistan’s Current Portfolio of the GCF

Currently, Pakistan has a portfolio of USD 249 Million with the GCF. Following are the 7 projects that have been approved by the Fund for Pakistan.

1. Scaling up of Glacial Lake Outburst Flood (GLOF) Risk Reduction in Northern Pakistan (UNDP; USD 37.5 Million; GCF Grant USD 37 million, co-financing 0.5 Million )
2. Transforming the Indus Basin with Climate Resilient Agriculture and Climate Smart Water Management (FAO; USD 47 Million; GCF Grant USD35 million; Co Financing USD 12 million )
3. Green BRT Karachi (ADB; USD 583 Million; GCF Grant USD 11.8 Million)
4. Pakistan Distributed Solar Project (JS Bank; USD 54 million ; GCF grant USD 1 Million; USD 9 Million Guarantee)
5. Recharge Pakistan: Building Pakistan’s resilience to climate change through ecosystem based adaptation for integrated flood risk management (WWF; USD 77.8 Million; GCF Grant USD 66 Million)
6. Community Resilience Partnership Regional Program (ADB; GCF Financing USD 120 Million; Pakistan’s share is USD 20-25 Million )
7. Acumen Climate Action Pakistan Fund (Grant USD 3 Million; Equity USD 25Million)

Global Environment Facility (GEF)

Through the availability of GEF funds, Pakistan is striving to meet the objectives of international environmental agreements. Pakistan has mobilized $ 41.1 Million USD from this facility till date.

The further detail on the ongoing approved and past projects in Pakistan can be found here .

The Global Environment Facility (GEF) is a family of funds dedicated to confronting biodiversity loss, climate change, pollution and strains on land and ocean health. Its grants, blended financing and policy supports helps developing countries address their biggest environmental priorities and adhere to international conventions. The fund has organized its work around five focal areas – biodiversity loss, chemicals and waste, climate change, international waters, and land degradation.

Pakistan’s Current Portfolio of the GEF

Pakistan has to date accessed USD 80.0 Million in funding from GEF. The GEF Funds are replenished every four years by System for Transparent Allocation of Resources (STAR).

Projects under Implementation:

1. Mainstreaming Climate Change Adaptation through Water Resource Management in Leather Industrial Zone Development (UNIDO; USD 3.3 Million)
2. Addressing the Drivers of Deforestation: Reducing the pressure on the High Conservation Value Forests of Chilghoza Pine of Pakistan (FAO; USD 4.5 Million)
3. Transforming the Leather Processing Industries towards Low Emissions and Climate Resilient Development Paths in Pakistan (UNIDO; USD 2Million)

Project Approved under GEF-7 Cycle (2018-2022)

1. Combating Climate Change through the Promotion and Application of Sustainable Biomass Energy Technologies in Pakistan (PASBET) (UNDP; USD 3.9 Million)
2. Accelerating Clean Technology Innovations for Integrated and Sustainable Waste Management Solutions for GHG Emission Reduction from Municipal and Industrial Solid Waste (UNIDO; USD 3 Million)
3. Combating land degradation through integrated and sustainable range and livestock management to promote resilient livelihoods in Northern Punjab (FAO; USD 2.5 Million)

Apart from the above approved projects, the GEF has allocated USD 17.7 Million for Pakistan under its country (STAR) allocation for 2022-2024.

Adaptation Fund (AF)

The Adaptation Fund, established in 2001, was initially financed with the share of proceeds of two percent of certified emission reductions (CERs) issued from activities under the Clean Development Mechanism (CDM) of the Kyoto Protocol. The Fund has financed $16 Million USD to Pakistan’s adaptation projects against adverse effects of climate change.

The further details on the projects of AF in Pakistan can be found here .

Global Shield Against Climate Risks

Pakistan has submitted the Request for Support document to the Global Shield Secretariat for financial support against climate risks. To develop country support package, the in-country process was carried out by UNDP and the Stocktake and Gap Analysis Report was launched by MoCC&EC in collaboration with UNDP on October 24, 2024 in Islamabad. Furthermore, proposals were requested from different government and private entities to gauge the interventions required for Pakistan’s country support package. The following areas of interventions will be covered:

1. Sovereign Finance
2. Livelihood Protection
3. Agricultural Finance
4. Public Assets
5. Risk Analytics

Climate Budget Tagging

A framework that tracks and reports government expenditures related to climate change adaptation and mitigation. It aims to integrate climate change considerations into fiscal policy and public finance management, ensuring that sufficient financial resources are allocated toward addressing climate-related challenges. With continued development, it can play an important role in helping Pakistan adapt to and mitigate the impacts of climate change while promoting sustainable development.

Green Taxonomy

MoCC&EC is co-partnering with the State Bank of Pakistan for framing the National Green Taxonomy of Pakistan for sectoral adaptation and mitigation goals, to achieve environmentally sustainable economic activity. The framework will guide investments in sustainable activities and support in developing environmentally friendly regulations.

Loss and Damage Fund

Pakistan Country Framework for Green Growth Initiatives (GGGI)

Pakistan Country Framework for Green Growth Initiatives (GGGI) is a strategic approach aimed at fostering sustainable development in Pakistan by integrating environmental sustainability with economic growth and addressing the country’s growing environmental challenges. The framework aligns with Pakistan’s commitment to climate change mitigation and adaptation. This initiative encourages the adoption of green technologies, sustainable practices, and climate-resilient development across multiple sectors.

Debt for Climate Swap

Being a debt stressed country, Pakistan has the potential to enter into an agreement with a lending country for social uplift through sustainable and green projects by investing the debt amount in climate action. This mechanism will allow Pakistan to swap its debt for a commitment to invest in its socio-ecological transformation, benefitting Pakistan and the global community.

NCQG and Pakistan

Pakistan has played a proactive role in negotiations on the New Collective Quantified Goal (NCQG) The NCQG is a goal to triple climate finance for developing countries from $100 billion annually to $300 billion annually by 2035. The goal was adopted at the UN Climate Change Conference COP29 in Baku, Azerbaijan on November 24, 2024. The NCQG aims to balance adaptation and mitigation, while taking into account the needs of developing countries.

Coordination with Development Partners

Climate Finance Wing plays a critical role in coordinating with international development partners to mobilize financial resources for climate-related projects. The wing is actively engaged with various Development Partners including ADB, WB, GIZ, FCDO, KOICA, JICA, AIIB, UNDP and UNIDO etc. to secure climate finance for both mitigation and adaptation initiatives. Through concerted efforts, the Wing ensures that Pakistan receives the necessary funding to address the impacts of climate change and pursue a sustainable, low-carbon development pathway as well as fill the financial gaps.