IN the face of Pakistan’s growing climate challenges, securing fair climate investment is more critical than ever. The World Bank estimates a staggering $348 billion is needed from 2023 to 2030 — $152bn for adaptation and resilience and $196 billion for decarbonisation. This surpasses our historical annual development budgets, emphasising the financial hurdle we must overcome.

Ensuring equitable climate finance is now pivotal. Govern­ments, businesses, and international stakeholders must unite to mobilise resources on a scale matching the challenge. Inclusive financing mechanisms are crucial to ensuring no community is left behind in our quest for a sustainable and climate-resilient economy for Pakistan.

Amidst these challenges, innovative business models offer hope. The private sector sees climate action as a compelling business opportunity. Environmental sustainability is no longer just a matter of ethics; it has become a strategic imperative for businesses.

Companies that take proactive steps to address climate change, minimise their environmental impact, and invest in resilience strategies are not just doing the right thing but also safeguarding their long-term financial stability and sustaining their competitive edge. Embracing climate action is a smart business decision.

Private sector climate financing in Pakistan currently stands at just 5pc, compared to India’s 51pc

However, private sector climate financing in Pakistan lags, currently standing at just 5 per cent. In comparison, Nigeria stands at 10pc, Kenya at 14pc, and India at an impressive 51pc, according to a UK International Develop­ment Report ‘Accelerating Green and Climate Fina­ncing in Pakistan’.

This financing gap calls for the active involvement of both local and international private investors. To pave the way forward, Pakistan must embrace green financing tools that incentivise investments in sustainable infrastructure, attracting both domestic and international investors to support climate-positive projects and ensure the nation’s economic stability in the long run. We must foster sustainable development and resilience, leaving a lasting impact on the country’s future.

The way forward for Pakistan must include adopting green financing tools to incentivise investments in sustainable infrastructure. When we put the right financial mechanisms in place, we attract domestic and international investors to fund the climate positive projects that Pakistan needs to safeguard its economy for the long term.

Finally, policy and regulatory consistency is crucial for providing a stable and predictable environment for sustainable development. The government must ensure that policies and regulations are aligned with long-term sustainability goals and provide clear guidelines for investors and businesses.

These measures will not only contribute to the country’s economic growth but also help mitigate climate change and improve the well-being of its citizens.

We continue to advocate that the private sector plays a vital role for positive climate impact, with businesses driving green transitions through innovative technologies and sustainable practices. Despite their efforts, tackling this challenge requires a collective approach. Public-private partnerships and global collaborations are necessary for inclusive investments and financing, which are vital to building resilience in our economies.

It is for all these reasons that the participation of the Overseas Investors Chamber of Commerce and Industry (OICCI) leadership at the Conference of Parties (COP), in collaboration with the government, sends a powerful message, which is that we need the combined efforts of the public and private sectors to tackle climate change.

Climate justice is not only a moral imperative for countries like Pakistan, but it also presents a significant business opportunity. To unleash its full potential, concerted efforts in leveraging private sector climate financing, both locally and globally, are essential. This approach can pave the way for a resilient and sustainable future for Pakistan.

The writer is the president of the Overseas Investors Chamber of Commerce and Industry

Published in Dawn, The Business and Finance Weekly, December 4th, 2023