ISLAMABAD, Oct 22 (APP):Pakistan must approach the 31st United Nations Climate Change Conference (COP31) with a clear demand for grant-based climate finance, a pipeline of investment-ready programmes and a strategy to prevent rising debt from undermining its climate ambitions, experts said on Thursday. They stressed that the country's ability to meet its climate commitments would depend not only on the availability of international funding but also on whether financial assistance …
Experts call for grant-based, programme-oriented climate finance ahead of COP31
ISLAMABAD, Oct 22 (APP):Pakistan must approach the 31st United Nations Climate Change Conference (COP31) with a clear demand for grant-based climate finance, a pipeline of investment-ready programmes and a strategy to prevent rising debt from undermining its climate ambitions, experts said on Thursday.
They stressed that the country’s ability to meet its climate commitments would depend not only on the availability of international funding but also on whether financial assistance reaches the institutions responsible for implementing projects at the national, provincial and local levels.
The experts highlighted these priorities during an online webinar titled “Financing Pakistan’s Climate Priorities at COP31”, organised by the Sustainable Development Policy Institute (SDPI) in collaboration with the Pakistan Renewable Energy Coalition (PREC). The discussion focused on the financing terms Pakistan should seek at the conference in Antalya, Türkiye, and the measures needed to translate national climate priorities into funded and implementable programmes.
A key concern was Pakistan’s Nationally Determined Contribution (NDC) 3.0, under which 33 percentage points of the country’s 50 per cent emissions reduction target are conditional on international support. The experts emphasised that without predictable and accessible climate finance, Pakistan’s ability to deliver on its commitments would remain constrained.
Saleha Qureshi, Senior Research Associate at SDPI, presented the mitigation position paper prepared for PREC, stressing that climate ambitions must be supported by adequate financing and should contribute to employment, exports and the protection of vulnerable communities.
She cautioned against turning global climate goals into compulsory national quotas without considering countries’ individual circumstances and financial capacities. Pakistan, she said, should seek recognition for progress in delivering its commitments without accepting binding national benchmarks that could place additional pressure on its development priorities.
Qureshi identified four key demands for Pakistan at COP31: recognition of climate action without rigid national benchmarks, grants instead of loans, investment in implementation rather than further diagnostic studies, and trade measures that do not penalise developing countries for pursuing economic growth.
She also highlighted Pakistan’s target of generating 60 per cent of its energy from renewable sources by 2035, noting that achieving it would require substantial investment in transmission infrastructure and energy storage to accommodate the growing share of renewable power in the national grid.
Dr Omais Abdur Rehman, Senior Associate in Renewable Energy Technologies and Lead Coordinator for PREC, presented Pakistan’s climate finance priorities on behalf of the paper’s author, Zainab Babar, a Research Associate at SDPI, who was unable to attend the webinar.
He said Pakistan faced the dual challenge of recovering from climate-related disasters while financing the transition towards a more sustainable economy. Meeting these demands would require climate finance that was accessible, predictable and suited to the country’s economic circumstances.
He called for grant-based assistance, programme-based financing instead of fragmented project support, and direct access to international climate funds. He also underscored the importance of debt sustainability, transparent disbursement mechanisms and clear language in international climate negotiations.
Discussing the Bridge mechanism, he noted that it was not yet an operational fund and that Pakistan was among five pilot countries. He said developing countries also needed clear regulatory frameworks, financially viable projects and blended finance arrangements capable of attracting private investment.
Mohammad Hassan Dajjana, Intergenerational Research Fellow on Energy with the World Economic Forum’s Future 26 and Associate Industrial Liaison at Renewables First, drew attention to the quality of climate finance and the difficulties developing countries face in accessing funding without increasing their debt burdens.
He observed that public climate finance over the past decade had largely consisted of loans rather than grants, raising concerns about the long-term financial implications for vulnerable countries already struggling with the costs of climate disasters.
Dajjana stressed that different climate interventions required different financing arrangements. Early warning systems, for instance, should not be expected to satisfy conventional bankability requirements, given their public safety benefits, while utility-scale energy storage projects could be suitable for concessional loans.
He urged Pakistan to approach international donors with a range of financing options, including grants, concessional loans, debt-for-climate swaps and long-maturity funding for loss and damage. Such a diversified approach, he said, could help the country match financing instruments with the needs and financial viability of individual programmes.
The country’s energy infrastructure requirements also featured prominently in the discussion, with experts warning that the cost of the transition to cleaner energy could place additional pressure on public finances if it relied heavily on foreign borrowing.
Faizan Ali Shah, Energy Advisor and Board Member at iSCOPE, said the recently approved Transmission System Expansion Plan required approximately Rs3 trillion, or around $10 billion, over the next seven to 10 years.
He noted that the Power Division had received an allocation of around Rs88 billion under the Public Sector Development Programme (PSDP) for the current financial year, of which Rs76.6 billion was foreign assistance, highlighting the gap between available public funding and the scale of infrastructure investment required.
Shah warned that dollar-denominated foreign loans exposed electricity consumers to exchange-rate risks because debt-servicing costs were ultimately recovered through power tariffs. This made the financing structure of energy infrastructure projects as important as the investments themselves.
He said the government was increasingly turning towards domestic banks and capital markets to mobilise resources, citing a Rs1.2 trillion financing facility signed with 18 banks in 2025 to address circular debt in the power sector.
According to Shah, bank deposits had reached Rs40.8 trillion in September 2026, making the estimated Rs3 trillion transmission investment requirement equivalent to about seven per cent of those deposits. He suggested that domestic financial resources could play a greater role in supporting the country’s energy transition.
However, he stressed that Pakistan needed stronger technical capacity to develop competitive grant proposals and translate climate priorities into fundable programmes. Think tanks and academic institutions could support government agencies in preparing proposals and strengthening their engagement with international financing institutions.
He also proposed establishing a dedicated wing within the Ministry of Climate Change to coordinate climate finance across ministries and set clear targets for mobilising grants.
Sohail Malik of the Climate Resourcing Coordination Center, a technical expert on climate finance, said one of Pakistan’s biggest challenges was converting adaptation needs into proposals that financing institutions could assess and provincial authorities could implement.
Citing figures from 2022, he noted that 69 per cent of climate finance had been provided in the form of loans, reinforcing concerns about the growing debt burden on developing countries.
Malik outlined four steps for improving Pakistan’s access to climate finance: prioritising investments using risk-based evidence, securing funding for project preparation rather than relying solely on concept notes, connecting priority programmes with accredited entities and potential financiers at an early stage, and designing implementation arrangements before projects receive approval.
He said Pakistan should focus its COP31 negotiations on obtaining support to turn climate risks and priorities into measurable programmes, securing assistance for feasibility studies, safeguards and financial structuring, and improving practical access to the Green Climate Fund (GCF) and the Adaptation Fund.
He also emphasised the need for Pakistan to arrive at the conference with a prioritised pipeline of provincial programmes, enabling international commitments to be translated into projects with clear objectives, financing requirements and implementation arrangements.
The discussion underscored that Pakistan’s climate finance challenge extends beyond securing pledges at international conferences. The country must also develop credible programmes, strengthen institutional capacity, improve coordination between federal and provincial authorities, and ensure that funding reaches communities and institutions most exposed to climate risks.
For Pakistan, the experts suggested, success at COP31 would depend on securing financing that supports climate resilience and the transition to cleaner energy without deepening the country’s debt vulnerabilities. A shift towards grants, stronger project preparation and a clearly defined pipeline of provincial priorities could help bridge the gap between climate commitments and practical action.
