ISLAMABAD - Experts and stakeholders on Wednesday called for a more enabling financial and policy ecosystem to accelerate Pakistan’s industrial energy transition, particularly for small and medium-sized enterprises (SMEs) that face barriers in accessing finance, preparing viable projects, and adopting clean energy technologies. Speaking during a consultative discussion hosted by the Sustainable Development Policy Institute (SDPI) under its Pakistan Industrial Decarbonization Program (PIDP) and Network for Clean Energy Transition (NCET) in collaboration with International Network of Energy Transition Think Tanks (INETTT), on “Making the Industrial Energy Transition Investable: Mobilizing Capital for Renewable Energy”, the experts emphasized that the challenge extends beyond the availability of capital.
What is needed is an integrated ecosystem that can make clean energy investments commercially viable, financially bankable, and accessible to a broader range of industrial consumers, said a press release.
Ms. Saleha Qureshi, Lead Pakistan Industrial Decarbonization Program, at SDPI, emphasized the importance of appropriate financing mechanisms, including de-risking instruments, guarantees and concessional finance, particularly for industrial sectors undertaking the transition to cleaner technologies.
She noted that Pakistan’s estimated financing requirements of approximately $565 billion under its Nationally Determined Contributions (NDCs 3.0) are pitched at the level of the overall economy, and do not disaggregate what industry specifically would need, underscoring the point that climate and energy financing cannot be addressed without a sector-specific approach that reflects the realities of industrial businesses.
Ms. Kajol, Project Lead at Agora Industry, highlighted that businesses and industries assess clean energy investments primarily through the lens of business viability, including profitability, payback periods, policy predictability, and the ease of navigating regulatory requirements.
She noted that many SMEs and smaller businesses lack the financial and technical capacity to independently develop and pursue clean energy projects, making it difficult for them to attract developers and financiers.
Mekaeel Malik, Founder, Climate Finance Pakistan, pointed to broader constraints within Pakistan’s financing landscape, including limited access to private-sector credit, risk aversion within the financial sector, and challenges faced by entrepreneurs and clean technology businesses in raising capital.
He emphasized that financing needs should be accompanied by stronger technical competence so that promising ideas can be developed into scalable and commercially viable ventures.
Muhammad Sheraz Aamir, Associate (Energy and Climate) at Renewables First, highlighted the challenges faced by SMEs that often operate with limited working capital, insufficient collateral and restricted access to conventional bank financing. He pointed to credit guarantees and concessional finance as important instruments for enabling smaller industrial consumers to participate in the energy transition.
Modern farming helps Mohmand farmers extend growing season
Mashhood Urfi, Energy Transition Officer, at Alternate Development Services, emphasized that many of the puzzle pieces required for industrial climate finance are already present, but greater prioritization is needed to make existing instruments accessible to businesses. He raised the question of whether available financial mechanisms are effectively reaching SMEs and MSMEs, particularly in sectors such as textiles.
In conclusion, Arfa Ijaz, Researcher at SDPI’s Energy Unit, drew together the threads raised through the session, noting that the conversation had moved from the specific challenges facing individual SMEs to the reforms needed to support them at scale, from demand aggregation and de-risking instruments to policy predictability and stronger coordination between financing institutions.
The discussion concluded that Pakistan does not necessarily need to create an entirely new financing architecture. Rather, existing financial instruments, institutions and policy mechanisms need to be better connected through project preparation support, demand aggregation, risk-sharing mechanisms, appropriate financing products, predictable policies and stronger institutional coordination.
© 2026 SDPI. All Rights Reserved Designed and developed by NKMIS WEB Unit
