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KARACHI, May 16 (APP):The Federal Minister for Finance and Revenue Senator Muhammad Aurangzeb on Friday announced the launch of Sovereign Domestic Green Sukuk (SDGS) for development of key water related infrastructure projects across Pakistan, one of the most climate change affected countries on the globe.
The Finance Minister, addressing online to the gong ceremony held here at Pakistan Stock Exchange Karachi to mark the launch of the first ever Green Sukuk, said the inaugural issuance of Rs 30 billion will be conducted through auction and be listed on PSX.
The minister highlighted the record closing of the PSX 100 index on the previous trading day and termed it the reflection of successes achieved by Pakistan in all the spheres of life while the nation is observing ‘Youm-e-Tashakaur’ (Thanksgiving day) with reinvigorated spirit and zeal as well.
Things on different fronts are progressing in a positive way and this listing on this day will prove beneficial for Pakistan and PSX as well, he said and also reflected on recent meetings with bilateral and multilateral partners and friendly countries as well as investors, who appreciated our financial performance and urged on continuity of major reforms.
In the wider context, climate is an existential threat for Pakistan and we have stressed on its financing, the finance minister stated adding that the government has taken various measures to ensure expansion of climate financing.
Senator Aurangzeb said that financing is expected from ADB at end December, Pakistan is in the 10 year country partnership with the World Bank while the most recent addition was release of $ 1.3 billion by IMF under the Resilience and Sustainability Facility (RSF)- an affordable longer-term financing to support low-income and vulnerable middle-income countries.
“This is all there for us, to use it for re-adaptation and financing and also taking very concrete reform measures which are required,” he stated, emphasizing on judicious utilization of available resources. The minister also urged the private sector to step ahead on this front as well.
The finance minister said that consultation for budget 2025-26 was initiated at the early stages and proposals received from all the stakeholders were being reviewed and evaluated. “We want the budget to reflect the strategic direction of travel of Pakistan’s economy very much in line with the homegrown economic agenda which was outlined by the Prime Minister”, he added.
Following the address of the Finance minister, Gong Ceremony to mark the launch of Green Sukuk was performed in the trading hall by Advisor to Finance Minister Khurram Schehzad, CEO Meezan Bank Irfan Siddiqui, chairperson PSX Shamshad Akhtar, CEO PSX Farrukh Sabzwari, and senior executives of SBP and other banks and financial institutes.
Advisor to Finance Minister Khurram Schehzad, speaking at the occasion, said that we are facing two enormous challenges: one is climate change and the other is a rapidly growing population.
Highlighting the significant improvements in Tax to GDP, Debt to GDP and Revenue to Debt Servicing ratios of Pakistan in previous 15 months, he termed the launch of green Sukuk as a shariah compliant, purposeful and market oriented initiative in climate financing that will put the country on the global map of green financing.
In a bid to attract more climate financing, Khurram Schehzad informed that Pakistan is also ready to launch in the next quarter the Panda Bonds focused on the Chinese market. He urged the private sector to invest in these new green financial products, particularly the Islamic Banks are anticipated to play their role in the success of this sharia compliant green instrument.
Chairperson PSX, Shamshad Akhtar termed issuance of Pakistan’s first sharia compliant green Sukuk as a historical milestone for PSX and hoped that it will help in development of green and sustainable infrastructure that will result in availability of more funds to the government to invest in renewable energy, green transport and housing, and sustainable agriculture and infrastructure projects.
Highlighting the severity of climate change induced challenges she stressed on the need of starting the Living Indus project right away and urged the provincial governments to become part of this journey.
CEO Meezan Bank, Irfan Siddiqui, noting gradual growth of Islamic banking in Pakistan said that Islamic finance was introduced five years ago in the country and it was received well by the banks. Availability of the Sukuk is the only issue for Islamic banks and demand is already there, he said, adding that we will oversubscribe this issue.
CEO PSX Farrukh Sabzwari, at the occasion, hinted at the arrival of more green Sukuk in the market by the private sector following the launch of Sovereign Domestic Green Sukuk by the government of Pakistan saying that green Sukuk were in great demand around the globe.