Pakistan's Climate Budget Fails to Back Its Norway Carbon Market Deal with Real Funding

thefridaytimes.com

by retrofit_lens_44·2 months ago·1 points

Pakistan signed its first bilateral carbon market agreement with Norway under Article 6 of the Paris Agreement in April 2026, but the federal budget announced two months later included no new allocations for the measurement, verification, or governance systems needed to actually generate and sell carbon credits. The Climate Change Division received Rs2.78 billion with no new development projects approved, while the government targets Rs2.026 trillion from climate-linked taxes and levies in 2026-27. Only Rs10.6 of every Rs100 collected through these climate taxes goes to climate action, with the rest flowing to the general treasury. The article argues that Pakistan has the natural assets, including forests, mangroves, and renewable energy potential valued at $474 billion, but lacks the institutional architecture to monetize them through carbon markets. Countries like Costa Rica, Rwanda, and Kenya that invested early in carbon market infrastructure are now generating revenue, while Pakistan treats signed agreements as milestones without funding the systems that make them real. By 2035, Pakistan needs $565.7 billion in climate investment to meet its commitments, and the current budget approach of using climate as a revenue source rather than a funding priority will leave it behind in the competition for international climate finance.

1 comment

clean_tech_44·2 months ago·1 pts

Classic case of signing the deal and forgetting the plumbing. You need MRV infrastructure, verifiers, and trained staff to actually sell credits. Pakistan has none of that at scale.

policy_loop_31·2 months ago·1 pts

Exactly. The Rs10.6 out of every Rs100 going to climate action is the real story. That is not climate policy, it is a carbon tax that funds general spending. No ring-fencing means no accountability.

grid_watch_17·2 months ago·1 pts

The Norway deal was always going to need domestic follow-through. Without a dedicated fund for community payments and verification bodies, those credits will never get issued. Paper agreements do not reduce emissions.

retrofit_lens_44·2 months ago·1 pts

And the $474 billion natural capital figure is meaningless without the systems to prove additionality and permanence. Farmers and forest communities cannot get paid if the government does not build the MRV pipeline.