By Ayesha Saba
ISLAMABAD, Oct 18 (Wealth Pakistan): Pakistan is engaging a wide range of international organizations, development partners, and private stakeholders to establish a national carbon-trading framework that will strengthen climate governance and monetize climate actions.
In an interview with Wealth Pakistan, Muhammad Saleem Shaikh, Climate Analyst at the Ministry of Climate Change and Environmental Coordination, said the initiative—driven by the Paris Agreement’s Article 6—allows countries to trade carbon credits to meet climate goals. For Pakistan, a nation with historically low emissions, this offers a major economic opportunity to generate revenue from its mitigation efforts.
Collaborative Work Underway on Carbon Governance
“The foundational work is underway. We are engaging with international non-governmental organizations and a broad array of stakeholders to build a robust carbon-governance system,” the analyst explained. He added that Pakistan sees strong potential for market development in energy, forestry, and construction sectors.
China Emerging as Strategic Partner
A key partner in the effort is China, which has become a global leader in carbon-market mechanisms.
“China possesses immense expertise and operational experience, particularly in the carbon-trading sectors of energy and transport,” Saleem Shaikh noted. Cooperation with China is expected to accelerate Pakistan’s readiness through shared best practices, regulatory tools, and technical expertise.
With the right mix of policy reforms, technical support, and regional cooperation, particularly with China, Pakistan hopes to position itself as a credible participant in the global carbon-credit system while advancing its Paris Agreement commitments.
Nature-Based Projects Support Carbon Goals
Pakistan has recently launched several nature-based initiatives aligned with carbon-sequestration objectives, including the planting of 14 million trees in mangrove forests. These projects enhance biodiversity while generating potential carbon-credit revenue.
Regulatory and Capacity Challenges Persist
The official acknowledged that building a functioning carbon market faces challenges such as regulatory gaps and limited institutional capacity.
“Lack of awareness, limited technical expertise, and policy ambiguity are key barriers,” he said. “Without structured carbon governance, private and international investors remain cautious.”
He added that the government is working to convene all stakeholders to identify obstacles and craft solutions that will create a transparent, efficient carbon-trading system supporting sustainable development and green investment.