A delegation from the International Monetary Fund (IMF) is set to begin negotiations with Pakistan today for the release of $1-1.5 billion in climate financing. The discussions will span three weeks and involve key government departments, including the finance, planning, climate change, petroleum, and water resources ministries, along with provincial governments and disaster management agencies.
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IMF Climate Funding Talks Underway
The talks aim to assess Pakistan’s efforts in climate resilience and sustainability. These discussions are a precursor to the IMF staff mission’s visit in early to mid-March for the first biannual review of the $7 billion bailout package.
To align with IMF recommendations, the government has integrated climate-responsive projects into the upcoming Public Sector Development Programme (PSDP). The focus will be on high-impact infrastructure, foreign-funded projects, and developments in the 20 least-developed districts to enhance climate adaptation.
Balancing Climate Investments & Economic Stability
The IMF acknowledges that such investments can strengthen Pakistan’s ability to withstand climate shocks and promote economic recovery. However, the lender has also cautioned that additional borrowing for climate resilience could increase debt levels. To counterbalance this, the IMF has urged Pakistan to pursue fiscal consolidation and structural reforms to maintain long-term economic stability.
The negotiations come at a crucial time as Pakistan navigates both economic challenges and climate vulnerabilities, making these talks key to securing sustainable financial support.
