Pakistan has reaffirmed its commitment to advancing climate action by presenting a comprehensive 13-point reform agenda to the International Monetary Fund (IMF), aligning with the $1.3 billion Resilience and Sustainability Facility (RSF) program through 2027. The agenda lays out concrete measures to integrate climate considerations into infrastructure, energy, transportation, and water management sectors while enhancing disaster resilience.
Under the reform plan, Pakistan will strengthen disaster risk financing to better prepare for and manage natural disasters. All major infrastructure projects costing over Rs. 750 million will now require mandatory climate impact assessments, and at least 30% of expenditures on all infrastructure projects will be allocated to climate-related initiatives. A climate budgeting system will be introduced at both federal and provincial levels to track spending and ensure accountability in meeting sustainability goals.
A key element of the agenda is the introduction of an additional Rs. 5 carbon levy on petrol and diesel to discourage fossil fuel consumption and fund climate programs. Complementing this, the government has announced subsidies to promote electric vehicles, targeting 30% of new cars and 50% of new motorcycles to be electric by 2030. Electricity subsidies will be limited to deserving consumers, with support gradually phased out for higher-income users, while efforts to reduce line losses and electricity theft will be intensified. Energy labeling will become mandatory for major appliances, including refrigerators, fans, LEDs, motors, and air conditioners, with the sale of energy-efficient products actively promoted through June 2027.
Water management reforms are also a core part of the agenda. Future development projects will require climate impact assessments, and service charges will be introduced for efficient water use in Sindh, Khyber Pakhtunkhwa, and Balochistan. Provinces will enhance revenue collection from irrigation systems through a new water tariff adjustment system in Sindh and Punjab.
Financial oversight and reporting will be strengthened with the issuance of annual climate budget reports and improved planning for climate-related disasters at federal and provincial levels. Banks will be tasked with assessing climate-related financial risks, while green finance mechanisms and a green taxonomy will be introduced to align Pakistan’s financial sector with international sustainability standards.
This multi-pronged approach reflects Pakistan’s commitment to integrating climate resilience across its economic, environmental, and social policies, ensuring that sustainability and disaster preparedness are embedded in national planning through 2027 and beyond.
