The Green Climate Fund (GCF) has committed $15 million to Pakistani venture capital firm Sarmayacar, the venture fund said on Wednesday, so it can help startups tackle the impact of climate change in the country that has been at the forefront of extreme weather.
Flooding in Pakistan, which scientists said was aggravated by global warming, affected at least 33 million people and killed more than 1,700 from the beginning of the monsoon season in mid-June 2022 until mid-November that year.
At the same time, the country’s challenging macroeconomic and political situation means cash to address the problem is in short supply.
In particular, venture capital funding fell to $16 million during the first nine months of 2024, a 57% year-on-year drop from the $37 million recorded in the same period the previous year, according to data compiled by Data Darbar.
Set up more than a decade ago, the GCF is part of UN efforts to help the world’s poorer countries adapt to climate change.
The deployment of the $15 million hinges on Sarmayacar raising an extra $10 million, CEO and Founder Rabeel Warraich said, adding he expected the fund will be able to begin funding action by the first quarter of next year.
He said the GCF funding would have “an anchoring role” in the new fund that Sarmayacar has set up, which he said could have a maximum of $40 million in funding.
Its capital is earmarked for startups in areas including energy, electric mobility, water treatment, recycling, sustainable agriculture, and carbon accounting, Warraich said, and is investigating startups to invest in.
The GCF’s website said it had allocated $282.7 million in total to Pakistan across 10 projects. The GCF was not immediately available for comment on the latest pledge.
The International Monetary Fund, which last month agreed a bailout for Pakistan, has also agreed to hold talks with the country on financing under the Fund’s Resilience and Sustainability Trust (RST) to generate financing for projects related to climate change.
Reuters