Pakistan to Float Rs. 30 Billion Green Bonds on PSX as Part of IMF-Backed Climate Finance Strategy
In a significant move toward climate finance and sustainable economic development, the Government of Pakistan is preparing to issue green bonds worth Rs. 30 billion on the Pakistan Stock Exchange (PSX). The initiative is aimed at securing the initial tranche under the International Monetary Fund’s (IMF) Resilience and Sustainability Facility (RSF), according to sources from the Ministry of Finance.
This issuance is part of a broader framework developed in coordination with the IMF to ensure transparency and accountability in the allocation of climate-related funding. The funds raised through the green bonds will be channeled exclusively into projects targeting climate change mitigation and environmental sustainability. The IMF will actively monitor both the fundraising process and the execution of related projects to ensure they align with the agreed-upon climate objectives.
The green bond issuance is anticipated to take place either later this month or by next month, depending on final approvals and market readiness. This step reflects the government’s growing emphasis on integrating climate finance into its broader fiscal planning, particularly under the terms set forth by global financial institutions like the IMF.
Originally slated for release during the current fiscal year, the timeline for the green bond offering was recently revised. The change comes as the government works to fine-tune its financial instruments and ensure alignment with international sustainability standards and investor expectations.
In addition to the domestic green bond initiative, the government is also planning to issue Panda bonds — yuan-denominated securities sold in China by foreign issuers — worth $300 million. These are expected to be floated in the Chinese financial market by November or December of the next fiscal year. The Panda bonds are part of Pakistan’s multi-channel approach to meet the structural requirements set by the IMF for unlocking future tranches under the RSF.
The Resilience and Sustainability Facility is a special IMF program aimed at helping vulnerable countries address long-term challenges like climate change through access to affordable, long-term financing. For Pakistan, tapping into the RSF is a critical step toward climate adaptation and resilience-building in the face of intensifying environmental risks such as floods, droughts, and rising temperatures.
By leveraging capital markets to finance green initiatives, the Pakistani government aims to not only meet its international climate commitments but also strengthen its position as a responsible participant in the global green economy. Experts suggest that this move could catalyze further green investment from private and institutional investors, both domestically and internationally.
The strategic alignment of bond issuances with climate finance goals signals a new chapter in Pakistan’s economic policy — one that increasingly integrates sustainability with fiscal prudence and global cooperation. As the green bond market gains momentum globally, Pakistan’s entry into this space marks a progressive step forward in attracting climate-focused capital to support national development objectives.