KARACHI: Speakers at a research study launch on Monday said banks could help curtail pollution and improve the environment with prioritised funding to renewable energy (RE) projects, as fossil-fuel-based projects badly affect the atmosphere.
The study ‘In-depth analysis of Green Banking Guidelines of the State Bank of Pakistan’ was launched at the NED University premises. Department of Economics and Management Sciences, NED University conducted the study in collaboration with Indus Consortium.
Addressing the ceremony, head of the study group and chairman of Department of Economics and Management Sciences, NED University, Dr. Raza Ali Khan, said the purpose of green banking guidelines was to create environment-friendly banking and give importance to quality of life and society.
“Banking has an effective impact on the environment, as they are providing loans for the energy projects’ development. They can play a significant role to curtail pollution and improve the environment by limiting their funding to renewable energy projects.”
He said as academics or policymakers their job was to present recommendations only. “Sometimes they are adopted in policies, sometimes they are ignored.” Khan was of the view that some policies were adopted on political basis, as politicians prefer to consider policies for a short term of five years.
CEO of Indus Consortium Hussain Jarwar said civil society organisations were getting the research studies done by individuals, which were not worthwhile, as it was work of the professional researchers and academia.
He said Indus Consortium was collaborating with 30 major universities in the country including NED for development of research studies. “Energy sector alone is responsible for more than 50 percent of emissions of greenhouse gases and Thar coal development is one of the largest examples in Pakistan.”
Mirza Faizan Ahmed, a research associate and assistant professor at the Department of Economics and Management Sciences, said the State Bank of Pakistan (SBP) had issued green banking guidelines in 2016-17 with the SBP, commercial banks, and renewable energy developers as its stakeholders.
“However, the environmental aspect is the least prioritided in the public and private sectors. We need to motivate industry to implement these guidelines,” he said. The study’s research associate and teacher Shabbir Ahmed Baqai presented findings of the study, saying out of 32 commercial banks in the country, 18 banks had taken some initiative towards the implementation of the guidelines. The analysis focused on Habib Bank Limited as a model, which was disbursing more than 40 percent of funds out of total energy project development funding.
The SBP issued the Green Banking Guidelines (GBG) in 2017 intending to transform the country's economy and acknowledged the role of the financial sector towards a low-carbon and climate-resilient economy. It helps bring awareness among investors, and the banking industry to make its infrastructure, operations, investments, and products sustainable.
The guidelines provide details about the responsibilities, management, and organisation for the GBG implementation and construct three themes to work upon, which include environmental risk management, green business facilitation, and own impact reduction. The key stakeholders of the guidelines are the SBP, banks/development finance institutions, and customers /RE developers.
Fiza Qureshi, manager programs at Indus Consortium, said according to the guidelines, Pakistan’s energy transition should be 25 percent on renewable energy resources by 2025 and 30 percent by 2030.
She urged that climate change was demanding concrete measures to deal with it. “Due to climate change, 1,700 mm of rain was recorded this year in the country, which was not witnessed in the last 50 years and 33 million people were affected by it. Sindh is still under flood water.”
Qureshi said under climate change results, affected areas would either face droughts or floods. “We have to discourage energy produced through fossil fuels and have to bring green initiatives at the front by shifting towards solar and wind energy initiatives,” she emphasised. A large number of teachers, research fellows, and students were present at the launch ceremony.
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