Pioneering carbon credit trade

Sindh has set a precedent for the rest of Pakistan by successfully entering the global carbon credit market. Through its Delta Blue Carbon-1 project, the Sindh government has sold approximately three million tonnes of CO2 equivalent credits, earning $40 million. This milestone truly brings to light the potential of leveraging nature-based solutions to combat climate change while generating much-needed revenue.

The project is a public-private partnership between the Sindh Forest Department and Merlin's Wood Private Limited. The private firm shouldered the initial costs of verification and monitoring, and the government received a 40% share amounting to $14.747 million. This revenue, while modest compared to global transactions in the carbon credit market, marks a significant step forward for a country grappling with climate vulnerabilities and limited financial resources. The project has already restored over 100,000 hectares of mangroves, with a target to expand this to 225,000 hectares by 2030. This restoration is critical for sequestering carbon and maintaining biodiversity. Mangroves, referred to as "blue carbon", are one of the most efficient carbon sinks. Their preservation and expansion serve both ecological and economic purposes, especially as the demand for high-quality carbon credits continues to rise, with prices projected to increase from $13 to $20 per credit.

Nonetheless, the road ahead requires vigilance and sustainable planning. The revenue from carbon credits is promising and must be reinvested transparently to ensure long-term ecological benefits and community development. The next step is to look towards scaling similar projects across the country and then approaching relevant investors. To fully realise the potential of such projects, Pakistan must market it internationally and advocate for a fairer global climate finance system.