Pakistan will require an estimated $331 billion in climate financing by 2030 to build resilience against climate change and limit rising economic losses, according to the State Bank of Pakistan, which warned that the country faces a massive funding shortfall despite being among the world’s most climate-vulnerable nations.
In a recent report, the central bank said Pakistan would need about $47 billion annually from 2024 to 2030 for climate adaptation and mitigation measures. That amount is equal to nearly 10 percent of the country’s cumulative GDP over the period, underscoring the scale of investment needed to safeguard infrastructure, livelihoods and long-term economic growth.
The estimate, based on figures from the Climate Policy Initiative, comes as Pakistan continues to face increasing pressure from extreme weather events while contributing only around 1 percent of global greenhouse gas emissions.
The report noted that Pakistan ranked as the 15th most affected country by climate-related disasters between 1995 and 2024. Government estimates cited by the central bank put the country’s climate financing needs between $200 billion and $348 billion by 2030 for climate-resilient development and implementation of its Nationally Determined Contributions.
It added that the Pakistan Climate Prosperity Plan envisions investments of $1.6 trillion by 2050, highlighting the long-term scale of the challenge.
Climate-related disasters have already caused an estimated $58.8 billion in economic losses in Pakistan. Of that amount, $29.3 billion was recorded between 1992 and 2021, while the 2022 floods alone caused around $28 billion in damages. Another $1.5 billion in losses was linked to the 2025 floods.
Despite the rising need, climate finance inflows into Pakistan have remained far below required levels. The report said the country received only $1.4 billion to $2 billion annually over the past decade, with inflows reaching a peak of about $4 billion in 2021.
The State Bank said the financing gap has been driven by multiple factors, including the global preference for mitigation projects over adaptation, recurring macroeconomic instability, elevated sovereign risk, political uncertainty, underdeveloped financial markets and weak institutional capacity.
It also pointed to Pakistan’s limited ability to develop bankable climate projects, as well as bureaucratic delays that have slowed the implementation of internationally funded programs.
The report warned that the economic cost of inaction could be severe. Citing World Bank projections, it said climate change could reduce Pakistan’s GDP by 4.5 percent to 6.5 percent by 2050 under an optimistic scenario, and by 7 percent to 9 percent under a more severe scenario.
Agriculture and industry are expected to face the heaviest impact, adding to concerns that climate change will increasingly weigh on growth, jobs and economic stability unless financing gaps are addressed.
