Key Takeaways
- The World Bank has allocated USD 22.65 million, or 32.35 percent, of the Connected Punjab project’s total financing to climate-related interventions.
- Climate finance is overwhelmingly geared towards mitigation, with 97.73 percent of the allocation linked to such measures.
- USD 10 million has been assigned to expanding broadband connectivity under Disbursement Linked Indicator-2.
The World Bank has classified nearly one-third of the USD 70 million financing for Pakistan’s Connected Punjab digital transformation project as climate finance, allocating a significant USD 22.65 million towards climate-related interventions.
According to the World Bank's IBRD/IDA Climate Finance Assessment Sheet, this allocation underscores the increasing integration of climate objectives into digital infrastructure and public sector modernisation initiatives in Pakistan.
Of the total climate finance, 97.73 percent is dedicated to mitigation measures, while only 2.27 percent supports adaptation-related activities, highlighting a strong focus on reducing emissions through digital connectivity.
The largest allocation of USD 10 million has been made under Disbursement Linked Indicator-2 (DLI-2), which focuses on increasing the number of people covered by fixed broadband internet, recognizing its role in reducing emissions and supporting climate-resilient development.
USD 1.5 million has been earmarked for DLI-5 to establish a regulatory framework for point-of-sale system providers in Punjab, while USD 5.5 million supports the operationalisation of a Digital Invoice Management System (DIMS) under DLI-6, with all three activities categorized as mitigation finance.
USD 5 million has been assigned to DLI-7, which seeks to expand the use of digital payment platforms integrated with DIMS across business sectors, also classified as mitigation finance.
In contrast, several core digital development activities received no climate finance allocation. These include DLI-1 for identifying urbanised areas for broadband coverage and DLI-3 promoting the use of compute-as-a-service for localised artificial intelligence applications.
The project’s Investment Project Financing (IPF) component includes a marginal USD 0.65 million in climate finance, with approximately USD 0.63 million in mitigation finance and a minimal adaptation component of USD 0.01 million.
Climate finance is calculated using the Joint Multilateral Development Banks’ methodologies for tracking adaptation and mitigation investments, ensuring that dual benefits are appropriately accounted for.
