IMF Flags Pakistan as One of the Most Climate-Vulnerable Nations, Approves $410 Million in Climate Aid
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Pakistan has been identified among the top 15 countries most at risk from climate change, as it faces a rapid increase in the number, strength, and scale of natural disasters, according to the International Monetary Fund’s (IMF) latest climate assessment.
As part of a newly agreed $1.4 billion climate financing framework, Pakistan is expected to receive $410 million in the upcoming fiscal year. This support falls under the Resilience and Sustainability Facility (RSF), which is linked to the country’s ongoing Extended Fund Facility (EFF) with the IMF.
The IMF noted that climate-related challenges have caused significant economic and developmental setbacks for Pakistan. One stark example is the devastating floods of 2022, which impacted over 33 million people and inflicted more than $30 billion in damages.
Policy Recommendations to Build Climate Resilience
To help the country build resilience against future climate threats, the IMF has recommended a series of policy actions. These include:
- Promoting electric vehicles
- Expanding renewable energy sources
- Initiating a decade-long tree plantation drive
- Putting limits on the construction of new coal-fired power plants
Pakistan's Commitment and IMF's Urgent Recommendations
Pakistan has pledged to cut its greenhouse gas emissions by 15% by the year 2030. To support this commitment, the IMF has urged:
- The implementation of green budgeting
- The development of disaster-focused financial planning
- The enhancement of institutional and legal frameworks aligned with Pakistan’s National Climate Change Policy
Challenges Ahead
While acknowledging progress in climate planning, the IMF cautioned that Pakistan's ability to cope with environmental crises remains fragile. These shocks not only put pressure on public finances but also hinder the execution of development programs across the country.
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