Pakistan declares climate change an ‘existential threat,’ secures billions in funding: says Finance Minister

Pakistan climate change existential threat—these were the urgent words echoed by Finance Minister Muhammad Aurangzeb during his 2025 federal budget speech on June 10 in Islamabad. The minister labeled climate change as not just a developmental or ecological issue, but as a survival-level crisis for Pakistan, one of the world’s most vulnerable nations to global warming and environmental degradation.

He cautioned that the nation is already seeing the devastating impacts of rising temperatures, extreme heatwaves, prolonged droughts, and record-breaking floods. Unless urgent action is taken with robust international partnerships, the country faces a catastrophic future.

Climate Funding Breakthroughs

Over the past 16 months, Pakistan’s government has made strategic progress in securing transformational climate finance, aligning with both domestic adaptation goals and global sustainability mandates.

Aurangzeb confirmed that the government’s climate finance strategy had unlocked over $40 billion in long-term development partnerships and grants. Most notably, a multilateral collaboration was established with the World Bank and International Finance Corporation (IFC), focusing on sustainable infrastructure, disaster resilience, and green innovation across a ten-year period.

A $40 Billion Green Commitment

This decade-long, $40 billion funding program represents the largest climate-focused development initiative in Pakistan’s history. The agreement with the World Bank and IFC covers climate-smart agriculture, urban resilience, clean energy, nature-based solutions, and early warning systems for climate disasters.

Aurangzeb stressed,

“These commitments are not merely symbolic—they are tools for survival. This money will build resilience into our systems and shield millions from the devastating effects of climate change.”

Resilience Through IMF’s $1.4 Billion Facility

After a year of negotiations, Pakistan also secured a $1.4 billion Resilience and Sustainability Facility (RSF) from the International Monetary Fund (IMF). This facility is specially designed to help climate-vulnerable nations build institutional capacity and risk preparedness, especially in the wake of recent floods and heatwaves.

The IMF praised Pakistan’s Climate Resilience Framework, a policy platform emphasizing emission mitigation, social inclusion, and disaster risk governance.

Sustainable Sukuk and Local Climate Projects

To expand local funding avenues, the federal government introduced a new line of green bonds (sukuk) targeted at environmentally friendly projects. These Islamic-compliant financial instruments allow local investors to support reforestation, renewable energy, flood barriers, and clean water infrastructure in vulnerable areas.

By blending faith-aligned finance with sustainability goals, Pakistan is pioneering a hybrid approach to climate resilience that taps into community-level participation.

Why This Matters: Pakistan’s Climate Vulnerability

Despite contributing less than 1% to global greenhouse gas emissions, Pakistan consistently ranks among the top 10 countries most affected by climate change, according to the Global Climate Risk Index.

The country has suffered:

• The 2022 super floods, displacing over 33 million people
• Severe crop failures in Sindh and Punjab due to extreme heatwaves
• Accelerated glacial melt in Gilgit-Baltistan and Chitral
• Chronic urban smog in Lahore, Karachi, and Peshawar

External Link: Germanwatch Climate Risk Index

Global Recognition and Internal Climate Strategy

Aurangzeb noted that the success of these funding deals is also due to Pakistan’s emerging role as a global climate advocate. The government has actively participated in forums such as:

• COP28 (Dubai)
• UN Climate Action Summit
• Green Climate Fund board meetings

Domestically, Pakistan is fast-tracking the National Adaptation Plan (NAP) and Nationally Determined Contributions (NDCs) in line with the Paris Agreement. Ministries have been instructed to climate-proof all development planning, especially in infrastructure, agriculture, and energy.

Internal Link: Read more: Pakistan’s National Adaptation Strategy

The Road Ahead

Pakistan’s declaration of climate change as an “existential threat” is not political rhetoric—it is a scientific and humanitarian reality. As the country takes bold strides to secure billions in green financing, the government must also prioritize transparency, execution, and community engagement to ensure that funds are effectively deployed.

The urgency is clear. With projections of up to 5°C rise in average temperature by the end of the century and increased likelihood of massive monsoon disruptions, Pakistan cannot afford to delay.

Aurangzeb concluded,

“This is our defining challenge. Either we act now—or we risk the future of generations to come.”

Key Takeaways

• Pakistan has declared climate change an “existential threat” and placed it at the heart of national policy.
• Over $40 billion secured through partnerships with World Bank, IFC, and IMF.
• A new $1.4 billion IMF Resilience Facility will support green governance and infrastructure.
• The government has launched green sukuk bonds for local climate investment.
• Pakistan continues to rank among the most climate-vulnerable countries globally.

Final Thoughts

The narrative is shifting: from vulnerability to action, from crisis to resilience. By leveraging international funding, launching innovative local instruments, and amplifying its voice on the global stage, Pakistan is transforming its climate struggle into a story of hope and determination.

External Link: IMF’s RSF Details

Internal Link: Explore: How Pakistan is coping with climate-induced disasters