The Sovereign Sustainable Finance Framework proposed by the Government of Pakistan to draw funds by using sustainable financial instruments, such as green bonds, social bonds, sustainability bonds, and international sukuks. The framework will enhance the involvement of Pakistan in the global sustainable finance market and benefit the ESG (Environmental, Social, and Governance) objectives of the country.
The new Pakistan Sustainable Finance Framework will help Pakistan issue green, social, and sustainability bonds in line with international standards. It follows the ICMA guidelines for green, social, and sustainability bonds, the Loan Market Association guidelines for green and social bonds, and blue bond guidelines from major global institutions.
The framework was developed with the assistance of Citibank and Deutsche Bank as Joint Sustainability Coordinators and is a structured approach to sustainable financing in Pakistan. It covers all future sustainable financing instruments, including bonds and sukuks that the Government of Pakistan will issue.
Sustainable Fitch has also made Second Party Opinion (SPO) of the framework to ensure credibility and transparency. The framework was given an excellent rating by the Fitch sustainable which indicated that it was highly aligned with global sustainable finance practices. Investors and stakeholders can access the SPO on the ministry of finance Pakistan.
The Sovereign Sustainable Finance Framework Pakistan will remain in effect and the authorities will revise it, periodically, to reflect the changing ESG needs and market practices.
Based on this model, Pakistan can foster its green bond market, provide the possibility to invest in social bonds, and fund the projects aimed at climate action, renewable energy, and social development. The framework is also a part of the strategy of Pakistan to create a more resilient and inclusive economy with the help of sustainable financing instruments.
