KARACHI: The State Bank of Pakistan (SBP) has released the draft of the National Green Taxonomy prepared with the assistance from the World Bank.

As part of its efforts to promote green finance, the central bank released the draft for public consultation, said an SBP circular on Wednesday.

`The taxonomy draft has been developed in collaboration with Ministry of Climate Change and Environmental Coordination with technical assistance from the World Bank,` said the circular.

The SBP said the National Green Taxonomy provides clear definitions of green projects and activities enabling the policymakers, banks and financial institutions and investors to increase capital flows to the sectors for climate risk mitigation and adaptation.

This will also provide clarity to financial markets about the green projects and activities, increase transparency in green investments and financial products, mitigate climate-related financial risks, and help the financial sector direct capital flows to projects or activities that will meet the country`s environmental and climate objectives, it added. To ensure that the taxonomy reflects a holistic view of all market players, the draft has been uploaded on SBP official website for public consultation.

`The SBP encourages all the stakeholders including the environment professionals and banks and public at large to share their valuable feedback on the draft within two weeks, enabling it to issue and rollout the finalised taxonomy as per plan,` it added.