The Decoupling Imperative

As the World Bank notes, “Environ-mental degradation costs Pakistan around 6% of its GDP each year.”

For eons, humans have relied heavily on natural resources for survival and development, harnessing them to maximize energy output. However, this pursuit has led to over-extraction and misuse of resources, resulting in ecosystem depletion and environmental degradation. These consequences present a new conundrum for humankind, as an established maxim decrees that material growth is not infinite. The finite nature of these resources necessitates a reevaluation of our approach toward economic progress. The traditional model prioritized expansion over sustainability, leading to deforestation, water pollution, mineral extraction, soil erosion, and biodiversity loss - an ominous sign for a sustainable future. As this approach falters, so does environmental sustainability, and an essential strategy called “decoupling” is needed.

Lately, the longstanding tension between economic advancement and ecological constraints has been addressed through the concept of “decoupling.” This notion, not in the context of US-China relations and global trade, posits that economic growth can be delinked from material expansion and environmental harm. Essentially, growth separated from ecological degradation paves the way for sustainable growth that further reconciles human prosperity with environmental stewardship. So, decoupling involves breaking the traditional link between economic expansion and environmental damage, enabling us to build a sustainable future.

A prime example of decoupling in action is the transition to renewable energy sources such as solar and wind power. Countries like Germany, Denmark, Australia, Costa Rica, and several others, particularly the global north, have significantly reduced their impact on climate change while maintaining robust economic growth. Despite a supply glut and price collapse, solar energy production in Germany continues to soar, illuminating a path forward for a low-carbon economy, and thus decoupling. A staggering 87% price cut for producers was observed during peak production hours in Germany, with prices plummeting even into negative territory. Likewise, according to Ember’s Statistical Review of World Energy (2023), in 2020 alone, wind power contributed 56% of Denmark’s total electricity generation, with the country aiming for its 100% utilization by 2030. By decoupling energy production from fossil fuels, these nations have demonstrated that economic progress and environmental stewardship are not mutually exclusive but complementary aspects of a resilient future.

While countries like Germany and Denmark continue to encourage renewable energy consumption, Pakistan is set to see another marked increase in prices of solar panels in the upcoming budget of FY24 despite merely 7% of its total energy production coming from renewable energy sources. Despite such a geospatial advantage, the solar energy sector is set to experience a sudden price surge yet again, failing to decouple the country from environmental survival, let alone revival. Anticipated additional taxes on solar panels with an expected hiked price of Rs.8 per watt to meet IMF conditions demeans hopes for decoupling.

Notwithstanding this hopelessness, one must take into account all the facts. Pakistan’s geographical location lies between 23° and 37° north latitude, with a significant portion of its landmass lying within the tropics, providing an advantageous position for harnessing solar and wind energy. With an average annual solar irradiance of 1,829 kWh/m², Pakistan receives some of the highest levels of solar radiation in the world, comparable to countries like Saudi Arabia. Pakistan, with its proximity to the equator and abundant solar resources, is poised to reap significant benefits from solar energy, making it imperative for the country to recognize and capitalize on its geographical advantage to transition towards a clean energy future. According to the World Bank, harnessing a mere 0.071 percent of the nation’s landmass for solar photovoltaic (solar PV) power generation would be sufficient to fulfill Pakistan’s existing electricity requirements. Wind is another abundant resource for the country’s energy conundrum as Pakistan has several well-known wind corridors with average wind speeds of 7.87 m/s in the 10 percent of its windiest areas stretched along Karachi, Ormara, Pasni, and Gwadar. However, despite such advantages, the installed capacity of solar and wind energy in Pakistan, at just over 1,500 megawatts, is only 4 percent of the total capacity, equal to around 2 percent of total power generation.

Pakistan needs to rapidly decouple its development trajectory from environmental degradation, with a sense of urgency that surpasses other countries, due to pressing reasons. First, over-dependence on fossil fuels has crippled the decoupling narrative, as according to NEPRA, 59% of Pakistan’s energy production comes from fossil fuels. Second, Pakistan ranks among the top 10 countries most vulnerable to climate change worldwide. Energy security concerns and water scarcity are few of the other reasons why Pakistan needs to decouple development from environmental harm rapidly. The country ranks 14th among the “17 extremely high water risk” countries globally, a list that includes hot and dry countries like Bahrain, Kuwait, and Lebanon. Over 80 percent of the total population in Pakistan faces “severe water scarcity” for at least one month of the year. Rapid urbanization and population growth further exacerbate the situation. With such dark clouds looming over the head, decoupling is the only way forward now.

Furthermore, we have now exceeded the point of diminishing returns, where environmental degradation no longer fuels development, but instead hinders it. Pakistan’s economy is heavily reliant on natural resources, and environmental degradation is already impacting economic growth too. As the World Bank notes, “Environmental degradation costs Pakistan around 6% of its GDP each year.” Hence, for Pakistan, decoupling is not only environmentally necessary but also economically imperative.

Achieving decoupling requires policy reforms and behavioral changes that prioritize environmental protection. Governments must adopt policies that support sustainable development, such as carbon pricing, eco-taxes, and subsidies for renewable energy sources. Taxation over the only good omen of development is certainly not the way forward. As the renowned environmentalist, Greta Thunberg emphasizes, “We need to start treating the climate crisis like the crisis it is.” As Pakistan stands at the crossroads of sustainable development, the clarion call of decoupling beckons. In decoupling lies the genesis of the country’s future prospects.

Danish Bhutto
The writer is an author, researcher and columnist based in Lahore. He can be reached at danishalee017

Danish Bhutto
The writer is a researcher and columnist based in Lahore. He can be reached at

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