Pakistan Transport and Climate Profile 2026

Outline

PAKISTAN

TRANSPORT AND CLIMATE PROFILE

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Background

Pakistan, a lower-middle-income country in Central and West Asia, faces the challenge of maintaining economic growth for its 251.3 million people while reducing emissions from its transport sector. In 2024, the GDP (PPP) was about $1.6 trillion, with a per capita GDP of $6,287. The transport sector is a key environmental concern, accounting for 48.8 million tonnes of CO2 in 2024, roughly 9% of all GHG emissions across the economy. Before the Paris Agreement, sector CO2 emissions grew by about 3.7% annually, but this rate slowed to 0.7% per year after 2015.

The decoupling of transport emissions from economic growth is evident in the sector's emission intensity. In 2024, transport emission intensity stood at 30.9 gCO2e per USD, a marked improvement from 47.2 in 2015 and 67.1 in 2000. While this figure is higher than the average for low and lower-middle-income economies (23.8 gCO2e/USD), it remains lower than the Central and West Asia subregional average (35.6 gCO2e/USD). Beyond tailpipe emissions, the sector also accounts for roughly 1.6 million tonnes of CO2-equivalent in embodied emissions annually, linked to the 36.0 million tonnes of material required for infrastructure expansion and maintenance.

Pakistan's transport sector still relies heavily on fossil fuels for its energy needs. In 2023, the sector used 676,543 terajoules of energy, with oil products making up 97% of this, a notable rise from 79% in 2010. Although energy intensity per GDP has improved—decreasing to 0.45 MJ per USD in 2023 from 0.93 MJ in 2000—it is still well above the Asia-Pacific average of 0.37 MJ per USD. Progress in shifting to alternative fuels remains stagnant; by 2023, biofuels and electricity represented <1% of transport energy consumption, highlighting a significant gap in adopting cleaner energy sources.

Road transport remains the primary mode, accounting for 96% of total emissions and and 98% of energy use. Rail and domestic flights each produce only 2%, with domestic navigation having a negligible effect. The vehicle fleet is mainly composed of two-wheelers (60%), followed by light-duty vehicles (13%) and three-wheelers (9%). Motorization has increased to 156 vehicles per thousand people in 2024, from 101 in 2000, but still lags compared to the Asia-Pacific average of 317, indicating a large potential for increased mobility.

Pakistan's geographic and climate characteristics render its transport infrastructure highly vulnerable. Since 2000, the country has experienced 156 natural disasters—mostly floods (56%) and storms (12%)—impacting over 90 million people and costing at least $54 billion. The transport sector could face average annual losses of around $218.7 million, predominantly affecting the road network (96%). National road vulnerability ranks 26th globally, signifying a high risk of systemic failure if critical segments are affected by natural hazards. Additionally, under a 4.5-degree warming scenario, over 4% of road and rail infrastructure will be exposed to extreme rainfall, and 1% of the population in low-elevation coastal zones is at direct risk from sea-level rise.

The fiscal environment for transport in Pakistan is characterized by increasing fossil fuel subsidies and decreasing tax income. Subsidies rose from $2.4 billion during 2010–2015 to $7.8 billion from 2016–2023, resulting in significant societal external costs, such as road crashes (71%), congestion (16%), and road damages (12%). Simultaneously, fuel taxes contribute about 1% to the government's total revenue and are likely to decline further due to electrification progresses.

The shift towards electric mobility (e-mobility) is gaining momentum. From 2017 to 2024, EV imports reached $289 million, representing 7% of the total road vehicle imports for that period. Most of these imports are light-duty vehicles (78%) and goods vehicles or buses (21%). Meanwhile, domestic bus production has decreased from 773 units in 2015 to 565 in 2024. Pakistan's E-mobility Readiness Index score is 76 out of 100, indicating moderate progress. However, progress is limited by a relatively high grid emission factor of 398 gCO2 per kWh, which has improved more slowly (0.9% annually) than the Asia-Pacific average (1.4%).

Urban mobility continues to be a significant challenge for sustainable growth. Despite an increase in rapid transit infrastructure from 0.7 km per million urban residents in 2015 to 1.1 km in 2024, the overall network remains small, with only 98 kilometers of BRT. Public transport access is very limited: in 69% of Pakistan's 55 urban areas, 80% of residents do not have easy access to services within 500 meters. Only 2% of these cities offer a level of service where half the population can reach these services easily. Active transport infrastructure also suffers from under-investment, with bicycle imports totaling just $58.8 million over ten years.

Funding for this sector has shifted toward official development assistance (ODA), which increased to $1.3 billion from 2011 to 2023, with 96% allocated to roads. Meanwhile, Public-Private Partnership (PPP) investments have dropped sharply from $2.2 billion in 2000–2010 to $240 million in 2011–2023, mostly focused on ports (98%).

Pakistan's policy framework is based on its 2025 NDC 3.0, aiming to cut projected emissions by 50% by 2030—15% from domestic sources and 35% depending on international support. However, the NDC does not include a transport-specific GHG target or a net-zero goal. Among 22 relevant policy documents, such as the National Transport Policy 2018 and the National Clean Air Plan, only 14% address climate adaptation. The overall policy emphasis is on mitigation (81%), focusing on improving public transportation, vehicle emission standards, and rail systems expansion.

Pakistan's strategic focus on "Avoid" measures aims to reshape urban structures to reduce the need for motorized travel. The 2018 National Transport Policy advocates for optimizing transport demand via integrated urban planning and "Transit Oriented Design," with goals to curb urban sprawl and foster compact city growth. This approach is supported by Pakistan 2025, which envisions transforming urban areas into "eco-friendly sustainable cities" through better city governance and enhanced local mobility infrastructure. Additionally, the National Freight and Logistics Policy intends to lower negative externalities by segregating intra-city and inter-city freight traffic, while encouraging e-communication and teleworking to cut down physical trips.

The core of the "Shift" strategy involves revitalizing the railway sector and expanding high-capacity public transportation to reduce traffic on high density corrdors. According to the Pakistan Updated NDC 2021 and Pakistan's Intended Nationally Determined Contribution, there has been successful deployment of Bus Rapid Transit (BRT) systems in major cities such as Islamabad, Lahore, Peshawar, and Multan, including Karachi's "zero-emission" metro line. To improve freight movement, the National Freight and Logistics Policy and Pakistan NDC 3.0 focus on upgrading the railway network—particularly Mainline-1—to shift freight share from road to rail, aiming for an increase from 4% to 22% by 2030. Furthermore, Pakistan's 2018 National Transport Policy promotes the development of walking and cycling infrastructure as key components of urban streets to reduce reliance on private motor vehicles.

The "Improve" pillar emphasizes shifting towards cleaner energy sources and more efficient vehicles. The draft Electric Vehicle & New Technology Policy 2020-2025 and the Auto Industry Development and Export Policy 21-26 are central to this effort, targeting electric passenger vehicle market shares of 30% by 2030 and 90% by 2040. These policies offer generous fiscal incentives, such as customs duty exemptions on EV-specific components and lower sales taxes for domestically produced electric vehicles. At the same time, the National Clean Air Plan requires a move to Euro-5 and Euro-6 fuel standards by 2030 and implements digital emission data monitoring for better compliance. In addition, the National Climate Change Policy promotes bio-fuels and the introduction of fuel-efficient aircraft to reduce the aviation sector's environmental impact.