Pakistan has officially launched its first National Carbon Market Policy at the COP29 global climate summit, marking a significant step in the country’s efforts to tackle climate change, promote green investments, and reduce emissions.
Announced at the sidelines of the COP29 global climate summit in Baku, the policy is set to make carbon markets a cornerstone of Pakistan’s climate strategy. It is designed to create a framework for carbon markets, incentivizing businesses and industries to adopt cleaner technologies and practices to meet climate goals under the Paris Agreement.
Romina Khurshid Alam, Coordinator to the Prime Minister on Climate Change, introduced the policy during a high-level event held at the Pakistan Pavilion, where she highlighted the pivotal role carbon markets will play in Pakistan’s transition to a low-carbon economy.
“Pakistan is ready to lead, innovate, and collaborate with both local and international partners to develop carbon markets, driving investment in green initiatives that will help us meet our climate targets,” said Romina Khurshid Alam during her keynote address.
She emphasized that the launch of the policy represents the beginning of a broader commitment to supporting sustainable development through carbon trading. Romina made the announcement at high-level event ‘Launch of Pakistan’s Carbon market Policy & Panel on Coordinated Access to Net Zero Development Financing Through Paris-Aligned Carbon Markets’ held at Pakistan Pavilion on the sidelines of COP29 global climate conference in Baku, Azerbaijan.
What are Carbon Markets?
Carbon markets are mechanisms that allow businesses to buy, sell, or trade carbon credits, which represent the reduction or removal of greenhouse gas emissions. By engaging in these markets, Pakistan aims to accelerate clean technology deployment across high-impact sectors, including energy, agriculture, waste management, and forestry.
Why are Carbon Markets important?
These markets help incentivize businesses and governments to adopt cleaner practices, aiming to transition economies to net-zero emissions by 2050. Carbon credits are generated through projects that follow carbon standards, ensuring verified emission reductions.
Carbon markets are critical for attracting private investment in climate action, especially in developing countries that face significant financing gaps. They provide a flexible mechanism to support climate goals, fund clean technologies, and enhance resilience to climate impacts. As the IPCC warns, achieving global climate targets requires urgent action and sufficient investment—carbon markets offer a vital solution to bridge the funding gap and accelerate the transition to a low-carbon future.
Pakistan’s Carbon Market Policy 2024
A key feature of Pakistan’s Carbon Market Policy is the introduction of both voluntary and compliance-based carbon markets. This dual approach will encourage private sector involvement and foster climate-resilient projects, helping Pakistan reduce its carbon footprint while generating economic and social co-benefits.
“The development of a regulated carbon pricing system will empower businesses to invest in green technologies, helping to address emissions and accelerate sustainable growth,” said Romina Khurshid Alam.
“The success of Pakistan’s carbon market will depend on collaboration—within our borders and across them. We welcome partnerships with international investors, organizations, and governments to ensure that this market becomes a regional and global success story,” she added.
Aisha Humera Moriani, Secretary of Pakistan’s Ministry of Climate Change, explained that the policy is the result of two years of rigorous work and aims to establish clear guidelines for carbon market activities that adhere to international standards. She added that the policy will serve as a model for future climate action, offering opportunities for both domestic and international investors to engage in the country’s green transformation.
“We are not just introducing a policy; we are laying the foundation for a robust carbon market that can drive long-term sustainable development in Pakistan,” said Moriani. “By launching this policy, we signal Pakistan’s readiness to engage with global carbon markets and open doors for international partnerships.”
The policy also aligns with Pakistan’s commitment to the Paris Agreement, allowing the country to monetize emissions reductions while contributing to global climate action. As the world confronts the urgent need for climate solutions, the launch of the National Carbon Market Policy positions Pakistan as a key player in the global effort to combat climate change.