Scaling Pakistan’s carbon markets for economic resilience: lessons from regional peers

The 2024 Carbon Market Policy Guidelines, launched in November 2024 at COP29 (29th Conference of the Parties to the United Nations Framework Convention on Climate Change (UNFCCC)), establish Pakistan’s first national framework for structured carbon trading, building on limited credit activities since the Kyoto Protocol’s ratification in 2005 (Ministry of Climate Change, 2024). This study analyses Pakistan’s carbon market framework by comparing it with India’s Carbon Credit Trading Scheme (CCTS) and China’s National Emissions Trading System (ETS) to propose policy enhancements for economic and environmental outcomes. Using a qualitative content analysis approach, the study evaluates policy documents from Pakistan, India, and China, focusing on regulatory frameworks, monitoring and verification standards, sectoral coverage, and economic impacts such as job creation and GDP growth. While global carbon market studies are predominant, comparative analyses of South Asian and East Asian systems, particularly involving Pakistan’s emerging market, remain limited. By addressing this gap, the study aims to suggest actionable policy recommendations to strengthen Pakistan’s carbon markets. Beyond supporting NDCs, an effectively implemented carbon market can enhance Pakistan’s economic stability by attracting international finance and fostering sustainable development. The broader objective is to contribute to global climate co-operation while promoting economic sustainability domestically.