The Pakistan Banks’ Association (PBA) is nearing the completion of the ‘Methodology for Allocating Climate Smart Agriculture Financing (CSAF) Targets’, marking a significant step towards integrating Climate Smart Agriculture (CSA) practices within the banking sector. This initiative is part of the broader efforts to address climate change challenges and reduce carbon emissions through sustainable agricultural practices.
The methodology, currently being finalized by PBA’s dedicated CSAF working group, will serve as a guideline for banks in setting their Agricultural Credit Targets for the fiscal year 2023-2024.
Key Focus Areas under Climate Smart Agriculture (CSA) include:
- Solar Energy Utilization: Promoting the use of solar energy for all State Bank of Pakistan (SBP) eligible agricultural financing items.
- Afforestation: Converting fallow lands into forested areas.
- Biogas and Sulphuric Acid Generators: Implementing biogas plants and generators, along with sulphuric acid generators.
- Organic Farming: Encouraging chemical-free farming practices.
- Water Management: Adopting water conservation techniques such as drip and sprinkler irrigation.
- Agro Machinery for Waste Management: Introducing specialized machinery for managing crop stubble, especially from rice crops.
- Climate Certified Dairy/Livestock Industry: Promoting environmentally sustainable practices in the dairy and livestock sectors.
- Environmentally Controlled Farming: Implementing tunnel farming, greenhouse, and hydroponic systems.
- Technology Integration: Leveraging satellite-based farm advisory, weather forecasting, and drone technology.
- Modern Storage Solutions: Upgrading storage facilities to minimize post-harvest losses.
The initial strategy for CSAF was developed by PBA’s Agriculture Finance Sub-Committee, outlining a comprehensive action plan that includes the development of innovative CSAF products, setting specific financing targets, adopting key performance indicators (KPIs), promoting CSAF products, and allocating refinance limits to farmers.
By promoting and integrating CSA practices, PBA aims to foster a more resilient and sustainable agricultural sector, driving positive environmental and economic outcomes for Pakistan.
Source: PBA