SDPI conference: Pakistan recommends new global financial architecture
ISLAMABAD: Pakistan on Monday rejected what it termed “rented development” through further borrowing, calling for a new global financial architecture to address mounting debt, climate change and technological disruptions. Meanwhile, Bangladesh proposed a new South Asian development model based on industrial transformation, regional production networks and employment generation.
Addressing the 29th Sustainable Development Conference and 4th Sustainability Investment Expo, organised by the Sustainable Development Policy Institute (SDPI), Planning Minister Ahsan Iqbal said existing multilateral financial institutions lacked the capacity to address the development challenges of the 21st century, particularly climate change and the financial vulnerabilities of developing countries.
He said Pakistan, despite contributing less than one percent to global greenhouse gas emissions, suffered devastating climate consequences, including the 2022 floods that affected 33 million people. However, the international response remained largely confined to repurposing existing loans instead of providing fresh financing or grants for reconstruction.
Iqbal called for a new global dialogue to reform multilateral institutions, arguing that the international financial system established after the Second World War was no longer equipped to deal with today’s economic, environmental and technological challenges.
He said geopolitical conflicts and rivalries were increasingly affecting energy supplies, food prices, international trade and supply chains, with consequences reaching ordinary households.
“A conflict thousands of kilometres away can raise the cost of a Pakistani farmer’s fertiliser, a factory’s production, and a family’s daily meal,” he observed.
Highlighting Pakistan’s technological preparedness, the minister said the government had established centres of excellence in artificial intelligence, cybersecurity, big data and cloud computing to equip young people for the changing global economy.
He stressed that countries relying exclusively on low-cost labour would face growing challenges from automation and advanced robotics, urging investment in education, scientific research, technological absorption and institutional capacity.
Referring to the mounting global debt burden, Iqbal cited a UNCTAD report, saying 3.7 billion people lived in countries where interest payments on public debt exceeded spending on health or education.
He said Pakistan aimed to become a USD1 trillion economy by 2035 and a USD3 trillion economy by 2047, requiring policy continuity, institutional preparedness, diversified exports and stronger economic resilience.
He added that the impact of external shocks depended not only on their magnitude but also on a country’s preparedness, export diversity, skilled workforce and institutional strength.
Advisor to the Bangladesh Prime Minister, Professor Rashid Almehmood Titumir, called for a new South Asian development paradigm based on industrial transformation, regional production networks, decent employment and stronger social protection.
He said cooperation between Pakistan and Bangladesh could establish a new example for the region, proposing integrated production networks connecting South Asia, Southeast Asia and the Middle East and North Africa.
He stressed that developing countries should attract investment that builds domestic capabilities, transfers technology and generates employment rather than focusing merely on capital inflows.
Titumir also called for revitalising the South Asian Association for Regional Cooperation (SAARC) to promote regional integration and address emerging economic challenges.
He said Bangladesh aimed to become a manufacturing hub and export gateway, while planning to increase education spending to five percent of GDP by 2030 from around two percent currently.
Federal Minister for Climate Change Musadik Malik said Pakistan would no longer pursue development through additional borrowing, maintaining that the country was open to equity investment and debt swaps but not further debt.
“That shop is closed. Whatever development we undertake must be fair, durable and genuinely ours,” he said.
Malik said Pakistan collected around Rs16 trillion in revenue, of which approximately Rs8 trillion was consumed by debt servicing, accounting for 48-49 percent of total revenue.
He described debt-financed development as “rented development”, arguing that the country needed to build durable assets without increasing its debt burden.
He also called for treating extreme heat as a labour-rights issue, proposing paid leave for workers exposed to unbearable temperatures without loss of income.
Outlining climate priorities, Malik stressed the need for early-warning systems capable of identifying vulnerable households and communities ahead of floods and glacier outbursts. “A warning without an address is addressed to nobody,” he remarked.
He also proposed using artificial intelligence to create employment opportunities for young people by training them to develop AI systems in regional languages, including Balochi, Brahui, Sindhi and Urdu.
Malik announced a USD10 million Green Field programme to provide equity-based investment for young people to undertake scientific experiments and develop innovative solutions, with the first competition planned within three months.
At another session, Prime Minister’s Coordinator on Climate Change Rumina Khurshid Alam called for an urgent transition towards regenerative agriculture, warning that water scarcity, declining soil health and climate disasters were threatening food security and rural livelihoods.
She said agriculture contributed 23.44 percent to GDP and employed roughly one-third of the workforce, while per capita water availability had declined to around 1,000 cubic metres annually.
Parliamentary Secretary for National Food Security Dr Shaista Khan Jadoon said the proportion of households experiencing moderate or severe food insecurity increased to 24.3 percent in 2024-25 from 15.92 percent in 2018-19.
Addressing the Sustainability Investment Expo, SDPI Executive Director Abid Qayum Suleri urged greater private-sector participation in climate action, saying governments alone could not mobilise the financing, technology and expertise required for sustainable development.
Danish Ambassador Martha Morsing offered cooperation in green energy, energy-efficient technologies and sustainable industrial solutions.
Overseas Investors Chamber of Commerce and Industry representative Umar Ahsan said Pakistan required more than USD550 billion in climate-related investment through 2035, or approximately USD50 billion annually, highlighting the need for private investment and concessional financing.
The expo also featured sustainability awards recognising initiatives in climate resilience, circular economy, clean energy, regenerative agriculture, digital innovation and inclusive development.
Copyright Business Recorder, 2026