Pakistan to set up carbon markets to cut emissions, lure investment

New ‘Carbon Neutral Pakistan’ initiative seeks to generate domestic green technology industry says government minister 

(pic; http://www.qasolar.com/)

(pic: http://www.qasolar.com/)

By Aamir Saeed in Islamabad

Pakistan will set up a carbon market with technical assistance from China to cut greenhouse gas emissions and lure foreign investment.

The ‘Carbon Neutral Pakistan’ project will receive 7.752 million rupees (US$76,205) in state funding out of its total cost of 313.96 million rupees (US$3.85m) in next year’s Public Sector Development Programme.

Pakistan’s parliament gave final approval to the project in next year’s budget  on June 23 along with 39.752 million rupees ($390,779) in the programme to combat climate change.

The developing country is vulnerable floods, droughts and extreme weather and needs up to US$15 billion a year to climate-proof its economy and cut emissions.

Pakistan pumped out nearly 150m tonnes of CO2 in 2008, which are rising at 6% a year, according to its climate change ministry.

Chinese advice

Arif Ahmed Khan, Secretary at the Ministry of Climate Change, told RTCC in an exclusive interview that local carbon markets would be set up with technical assistance from China for internal adjustment of carbon emissions and carbon credits.

“The carbon markets would help industrialists and other sectors to sell and buy carbon credits locally besides initiating a competition for greener technology,” he said.

The secretary said the project is being designed to meet future requirements that international community may impose on developing countries if an international deal on climate change is reached in COP-21, Paris summit in December of this year.

“Pakistan can also lure foreign investment in emission cuts in the coming years if we succeed in setting up the carbon markets to facilitate industrialists and people from other sectors,” he said.

The United Nations carbon market has spurred $356 billion of investment in emission cuts, encouraging climate-protection policies in at least 10 nations including China, India and Brazil, according to the Washington-based policy institute, Center for American Progress.

The secretary admitted creating a market was complicated, and said the ministry is working to simplify it for industrialists and investors with help of relevant experts and specialists. “We will also seek help from China to determine a viable carbon pricing formula,” he said.

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The ministry has initiated the process of hiring relevant specialists and experts to materialise the goal of setting up the carbon markets and make them operational as soon as possible, he said.

“We are planning to make the carbon markets operational in next couple of years but this is not an easy task to do,” he said, “it’s a complicated process and we also need financial and technical support from rich countries to make it happen.”

The impact of the project cannot be quantified in a short span of time rather its positive outcome on the country’s greenhouse-gas emissions cut may be significant in the coming 10 to 15 years, the secretary said.

Under the project, the ministry would also initiate capacity-building projects for all the sectors that contribute in the greenhouse-gas emissions including industry, livestock, forests and agriculture, he said.

“Officials and individuals will be coaxed to cut the carbon emissions by adapting to green technologies and new techniques,” he said.

Interview: Fear of floods, droughts dominate Pakistan climate plan 

Environment and climate change experts, however, remain skeptical about capability of the ministry to carry out the project and suggest the government to first focus on capacity-building of the relevant officials.

“Carbon Neutral Pakistan” sounds a good project in theory but the ministry does not have the capacity to work withother departments to design viable projects to cut the emissions, said Qamar-uz-Zaman Chaudhry, author of Pakistan’s climate change policy and the UN Secretary General’s Special Advisor for Asia with the World Meteorological Organisation and the Asian Development Bank.

He said that Pakistan’s carbon emissions will reach 400 million tonnes of carbon dioxide equivalent per year by 2030 if the government fails to initiate a viable project to cut the emissions.

Pakistan should tap Green Climate Fund and other available international financing resources to initiate projects like carbon neutral Pakistan and cut the emissions in different departments like industry, forestry and agriculture, he said.

“The government should encourage the industrialists to convert to green technologies by offering them incentives in taxes and duties,” he said, urging the rich countries to help Pakistan acquire cheap and green technology from the international markets.

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