InfraZamin Pakistan, Pakistan’s premier credit enhancement guarantor, in collaboration with the State Bank of Pakistan (SBP), Pakistan Banks’ Association (PBA), and the Private Infrastructure Development Group (PIDG) hosted a seminar titled Enabling Green Financing and Green Bonds via Credit Enhancement Solutions today at a local hotel.
The high-profile event brought together top officials from the State Bank of Pakistan and Ministry of Finance, CEOs, and investment heads from leading commercial banks in Pakistan, to discuss the potential of green financing, particularly green bonds, to accelerate sustainable economic growth in the country through support from the private sector.
The seminar featured notable speakers including Jameel Ahmed, Governor of the State Bank of Pakistan, Muneer Kamal, CEO of Pakistan Banks’ Association, Maheen Rahman, CEO of InfraZamin Pakistan, and Philip Skinner, Head of the Middle East, North Africa, and Pakistan at GuarantCo, and Origination Lead for Nature at PIDG.
Expressing his views at the occasion, Jameel Ahmed, Governor, State Bank of Pakistan said: “The SBP is leading from the front to provide a conducive environment to the financial industry and businesses to achieve the common objective of achieving climate resilience. For this purpose, SBP has taken both direct and indirect measures.”
Under the direct measures, SBP has introduced refinancing schemes for renewable energy, whereby financing of Rs. 94.7 billion has been disbursed by end June 2024.
The scheme has provided financing to more than 4,500 renewable energy projects, having a cumulative energy generation capacity of almost 2,061 MW. Whereas, under the indirect measures, the SBP aims to improve the capacity of the regulated entities to support uptake of green financing and enhance their resilience. In this regard, SBP issued ‘Guidelines on Green Banking’ with a view to enabling our regulated entities to recognize and prepare for managing environmental risks emerging from their businesses and operations.
Maheen Rahman, CEO, InfraZamin Pakistan said that for Pakistan to unlock the full potential of green financing, it is vital that we bring the private sector on board alongside government and regulatory bodies.
“At InfraZamin, our mission is to bridge financing gaps by providing credit enhancement solutions that reduce investment risk and make it feasible for the private sector to support green bond issuance and other sustainable projects,” she added.
The insights shared by these speakers underscored the importance of advancing green finance through structured frameworks and strategic initiatives. They highlighted Pakistan’s need to build on existing regulatory efforts, such as the State Bank of Pakistan’s ongoing work on developing a green taxonomy, which aims to provide a common language for identifying and supporting green projects. Additionally, they discussed the role of SBP’s Green Banking Guidelines in shaping sustainable finance practices. Drawing on lessons from other emerging markets, the speakers explored ways to incentivize green financing, reduce associated costs, and derisk green projects to encourage private sector participation. The discussions also emphasized the need for capacity-building to support the growth of green finance and to navigate the ever-evolving landscape of sustainable investment.
The speakers also proposed practical ways to support issuers in adopting green financing solutions. PIDG suggested offering grants to help cover the costs of global certifications, while InfraZamin highlighted the potential of credit enhancements to reduce balance sheet burdens on issuers and lower investment risk for investors.
In his talk, Philip Skinner, Head of MENA and Pakistan, GuarantCo further highlighted: “With the right support the private sector can lead the way in the development of the market for certified green, social and sustainability bonds and loans. GuarantCo and the PIDG has supported the first corporate green bond issuances in Bangladesh, Vietnam, Cambodia, Kenya and Zambia and have seen first-hand that the barriers to entry are much lower than perceived, whilst the potential for societal benefits as countries respond to the climate change challenge can be enormous.”
