KARACHI: Pakistan is losing close to 1.0 per cent of its GDP every year to climate-related damages, speakers said at the Fourth Pakistan Climate Conference, as policymakers and business leaders warned that the country faces an escalating environmental and economic crisis.
Organised by the Overseas Investors Chamber of Commerce and Industry (OICCI), the conference brought together federal and provincial policymakers, international institutions, climate experts, journalists and corporate leaders to address the country’s mounting exposure to floods, heatwaves and economic disruption despite contributing less than one per cent to global emissions.
Addressing the conference via video link, Minister for Finance Muhammad Aurangzeb described climate change as one of the country’s most pressing challenges, saying Pakistan is “on the brink of a battle for survival” in the face of worsening environmental threats.
Recalling the devastating floods of 2022, which caused severe economic losses, Aurangzeb noted that in 2025 nearly all provinces were affected by flooding in three major rivers,. “Climate change is a serious challenge for Pakistan,” he said, adding that the government is taking various measures to address its impacts. However, he acknowledged that financing remains a major constraint. “We do have a funding issue, but we must effectively utilise the funds that are available,” he said.
The minister highlighted that Pakistan has access to a $1.3 billion climate facility from the International Monetary Fund, along with climate financing windows from the World Bank and the Asian Development Bank. He also pointed out that commitments made in Sharm el-Sheikh have not been implemented as originally agreed.
Aurangzeb said Pakistan has issued green bonds and sukuk in domestic capital markets and is planning to launch panda bonds to mobilise additional resources for climate-related initiatives. Emphasising the role of the private sector, he said businesses must play a central role in tackling climate change. “We need to utilise existing funds through capacity building and pursue concrete initiatives such as public-private partnerships to mitigate climate risks,” he added.
He further said that a proposed 10-year, $20 billion development package from the World Bank will help address Pakistan’s climate challenges. Minister for Climate Change and Environmental Coordination Dr Musadik Malik said Pakistan is on the frontline of a rapidly intensifying crisis. “I commend the OICCI for creating a platform where climate resilience is treated not as CSR, but as an economic imperative. From record 53 degrees C heatwaves to floods that displaced four million people last year, with over 13,000 glaciers melting and climate losses costing nearly one per cent of GDP annually, this is an existential challenge,” he said.
Referring to Pakistan’s updated climate commitments, Dr Malik said the country’s NDC 3.0 targets a 50 per cent reduction in emissions by 2035, but achieving a just transition will require $565.7 billion in investment. He called for climate finance that is sustainable, grant-based and rooted in climate justice.
Speaking at the conference, Regional Lead for Sustainable Finance, Asia and Pacific at the United Nations Development Programme (UNDP) Chongguang Yu (Charles) said the core challenge is no longer the availability of capital but fragmented systems. He advocated blended finance, risk-sharing mechanisms and programmatic investment pipelines to unlock scalable private-sector participation.
OICCI President Yousaf Hussain said the government of Pakistan is making tangible progress on its climate agenda. He cited efforts ranging from pushing for adaptation finance through public-private partnerships at the World Economic Forum in Davos to finalising the $20 billion, 10-year Country Partnership Framework with the World Bank and preparing to launch Pakistan’s first Green Panda Bond. “Together, these steps signal a clear and credible national commitment to climate resilience,” he said.
Senior Vice President OICCI Jason Avancena said, “Building on the momentum from COP30, our discussions focused on translating climate commitments into economic outcomes — from modernising Pakistan’s strained power grid and accelerating renewable energy to unlocking Blue Economy opportunities through coastal resilience and marine sustainability, while leveraging artificial intelligence to improve climate forecasting, reduce disaster losses and strengthen investment planning,” he said.
