KARACHI — Finance Minister Muhammad Aurangzeb has warned that climate change has emerged as one of Pakistan’s most serious challenges, saying the country is now facing a fight for survival due to its growing economic and environmental impact.

In a video address to the fourth Pakistan Climate Conference in Karachi, the finance minister said recent years of extreme weather had caused widespread destruction and heavy economic losses. He recalled that floods in 2002 dealt a major blow to the economy, while in 2025 flooding across three major rivers affected nearly all provinces.

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Aurangzeb said the government is taking multiple steps to manage climate risks despite fiscal constraints. He noted that Pakistan has secured access to about $1.3 billion in climate-related financing from the International Monetary Fund, in addition to climate support facilities from the World Bank and the Asian Development Bank.

Financing gaps and green instruments

The finance minister acknowledged that commitments made at the Sharm El-Sheikh climate summit had not materialised as expected. However, he said Pakistan is exploring alternative avenues to mobilise resources, including green bonds, green sukuk, and the issuance of panda bonds in international capital markets.

He added that the State Bank of Pakistan is supporting climate-focused initiatives, while public-private partnerships could play a critical role in delivering practical and scalable solutions.

Aurangzeb also highlighted ongoing coordination with the National Transmission and Despatch Company and stakeholders in the energy sector to strengthen resilience and support the country’s transition toward cleaner and more sustainable energy systems.

He stressed that addressing climate change requires sustained international cooperation, domestic policy alignment, and innovative financing mechanisms to protect livelihoods and ensure long-term economic stability.