event details - The Need to Switch towards a Greener Future: Lessons from China

Concept Note:

The depletion of natural resources, global warming, and environmental degradation are among the greatest challenges humanity faces today. Since it is a clean, safe, and sustainable energy source, renewable energy has the potential to protect the environment and mitigate the effects of climate change. China has made great strides in the research and production of renewable energy and has shown its support for renewable energy by investing heavily in the industry. It is the largest exporter of solar photovoltaic (PVs) and many of the top 10 wind turbine developers are Chinese companies.

Moreover, China has established a solid financial infrastructure to back up projects involving renewable energy sources. In addition to the Chinese government’s support for renewable energy, private companies have also contributed to the development of these technologies by investing in research and development and committing to long-term projects that focus on sustainable energy. These public-private partnerships (PPPs) have resulted in China's emergence as a global leader in renewable energy.

Furthermore, China is now taking the lead in promoting greater green overseas investments following the release of the “Green Development Guidelines for Overseas Investment and Cooperation” in July 2020, and the “Guidelines for Ecological Environmental Protection of Foreign Investment Cooperation and Construction Projects” in January 2022 by the Ministry of Commerce and the Ministry of Ecology and Environment of the People’s Republic of China. Under the Belt and Road Initiative (BRI), green energy engagement (including investment and construction) expanded from $2 billion in 2021 to $8 billion in 2022.

China’s investment rebirth in the green mould provides an immense opportunity for Pakistan to capitalise on. Under the China-Pakistan Economic Corridor (CPEC), which is a major energy and infrastructure corridor with $62 billion of pledged investment, and $23 billion realised investment in energy projects, it is imperative that the government should strive to create a green finance-friendly environment in order to maximise the potential of Pakistan's renewable energy sector. Thus, there is a need for a national green finance strategy under CPEC that clearly defines the goals and objectives for promoting green finance in the country.

As part of CPEC, Pakistan is also developing a number of Special Economic Zones (SEZs) to stimulate manufacturing and to spur economic development. There exists a huge opportunity for initiating indigenous manufacturing of solar PVs in these SEZs, as manufacturers can take advantage of the incentives on offer to establish complementary industries to create efficient, durable, and cost-effective panels.

Considering the urgency of such initiatives, Sustainable Development Policy Institute (SDPI), in collaboration with the Pakistan-China Institute (PCI) aims to conduct a high-level conference with participation from both Pakistani and Chinese policy makers, industry experts and academics.

The conference has the following objectives:

1. To assess the current status and potential of green finance for financing renewable energy projects under CPEC, and to explore innovative ways of mobilising green finance for such projects in Pakistan.

2. To evaluate the prospects of solar PV manufacturing in Pakistan under the Special Economic Zones (SEZs) of CPEC, including the analysis of key factors such as market demand, technological capabilities, and policy environment.

3. To make recommendations for policy and regulatory frameworks based on China's journey towards expanding renewable energy, including best practices, challenges, and solutions.