Sindh to Earn $200-220 Million Through Carbon Credits

Federal Government has approved the provincial government’s request to allow the selling of carbon credits from the Indus Delta Mangrove Projects to the International voluntary carbon market till 2042. These projects will generate $200-220 million (Rs. 57-63 billion) by 2043 with 21,000 green jobs in addition to investments in afforestation and the re-vegetation of mangroves, reported DAWN. Sindh Government is working on Delta Blue Carbon 1 and 2 since 2015 and 2020 respectively in collaboration with a private entity selected by the department while 3.1 tons of carbon dioxide (CO2) from the first project has already been traded in international voluntary carbon markets for $14.7 million in revenue. With the mangrove project, the Sindh government seeks to earn $200-220 million by 2043 with 21,000 green jobs in addition to investments in afforestation and the re-vegetation of mangroves. Sindh Government has also argued that these revenues will enable biodiversity and climate benefits to coastal areas while committing all possible actions to reduce its share of greenhouse gas emissions of 55 tons by 2035. The Sindh Forest Department (SFD) asked for a no-objection certificate from the federal government to sell these carbon credits until 2042 which implied that these would not contribute to Pakistan’s Nationally Determined Contributions (NDCs) to International Community till 2043. The provincial government and SFD argued the said projects were started before the NDCs were made in 2021. It was also observed these projects would contribute less than one percent of 240 tons of CO2 of pledges made in commitments. Ministry of Climate Change submitted its NDCs to United Nations Fra­mework Convention on Climate Change in 2021 which constituted 15 percent of carbon credits equivalent to reducing 240 tons of CO2 in energy, industry, forests, agriculture, and the transport sector. It bears mentioning that NDCs are a primary part of the 2015 Paris Agreement and achieving the international goal of reducing carbon emissions by 40 percent at a minimum by 2023 and limiting global warming to 1.5 degrees compared to 1990. The Paris Agreement also enables private entities to generate carbon credits and trade those with international actors on voluntary carbon markets. But these credits cannot be counted under NDCs, so the private companies have to get certifications from their respective governments that they will adjust their commitments accordingly. The Climate Ministry is working on a carbon market policy and a net-zero framework with World Bank, but that would take two more years which is why an interim agreement is in the works.