Pakistan Unveils Sovereign Sustainable Finance Framework to Boost Green Investment

The Government of Pakistan has launched its Sovereign Sustainable Finance Framework, marking a major step toward integrating sustainability into the country’s financial strategy and expanding its presence in the global sustainable finance market. Announced by the Finance Division on September 30, the new framework is designed to guide the issuance of a range of sustainable financing instruments, including green, social, and sustainability bonds and loans. The initiative aims to foster a robust ecosystem for sustainable finance in Pakistan, supporting the country’s transition to a more resilient and inclusive economy. The framework was developed in collaboration with Citi Bank and Deutsche Bank, who served as Joint Sustainability Coordinators. It is aligned with leading international standards, including the International Capital Market Association (ICMA) principles for green, social, and sustainability bonds, as well as guidelines from the Loan Market Association and global blue bond standards. To ensure transparency and credibility, the framework received an independent Second Party Opinion (SPO) from Sustainable Fitch, a global leader in ESG ratings. Sustainable Fitch rated Pakistan’s framework as “Excellent,” highlighting its strong alignment with global best practices. The SPO is available to the public on the Ministry of Finance’s website. The framework will apply to all sustainable financing instruments issued by the Government of Pakistan, including bonds and international sukuks, and will be updated periodically to reflect evolving market standards and Pakistan’s environmental, social, and governance (ESG) agenda. Officials say the move is expected to improve Pakistan’s access to international sustainable finance, attract new investment, and accelerate the country’s efforts to build a greener, more sustainable future.