The Ministry of Climate Change has sought Rs1 billion in seed funding to establish the Pakistan Climate Change Fund, a landmark initiative designed to finance projects focused on climate adaptation, mitigation, and sustainability.
According to documents obtained by Wealth Pakistan, the Fund is being created under Section 12 of the Pakistan Climate Change Act, 2017 to mobilize financial resources for climate resilience and environmental protection. Once operational, it will become Pakistan’s central financing vehicle to support both domestic and international commitments, including those under the Paris Agreement.
Officials confirmed that the proposal has already been forwarded to the Finance Division. The Draft Climate Fund Rules, which define the Fund’s structure and governance, are awaiting final approval from the ministry.
Under the proposed framework, the Fund will be managed by the Pakistan Climate Change Authority and governed through three key committees: the Fund Management Committee for decision-making, the Fund Technical Committee for project evaluation and monitoring, and the Fund Investment Committee for guiding financial and investment strategy.
The Fund will draw financing from multiple sources, including government allocations, endowments, donations, investment profits, and receipts from carbon and other revenue-generating projects of the Authority. The ministry expects that once the initial capital is secured, the Fund will attract participation from international development partners and private investors.
As outlined in the proposed disbursement plan, 40 percent of funding will be directed toward climate adaptation projects, 30 percent toward mitigation initiatives, and 20 percent toward capacity building, research, and communication, while up to 10 percent will cover administrative expenses.
To ensure wider inclusion, the Fund will operate a tiered grant system. Small grants of up to Rs5 million will support community-level and NGO projects, medium grants ranging from Rs5 million to Rs50 million will target scalable initiatives in the public and private sectors, and large grants exceeding Rs50 million will fund transformational, multi-sectoral projects with long-term impact.
A co-financing mechanism will also be introduced, allowing private sector participation at a 1:2 ratio, encouraging investment in green ventures.
Once launched, the Pakistan Climate Change Fund is expected to become a cornerstone of the country’s sustainability and economic resilience framework, channeling resources into initiatives that directly address the risks and impacts of climate change.
