Bangladesh can earn $1b a year from carbon market: analysts

Bangladesh has the potential to generate up to $1 billion annually from the global carbon market, but a lack of clear national policy continues to limit investment in the sector, analysts said at a discussion.

Despite some progress, including $17 million earned since 2006 through projects like improved cooking stoves and solar home systems, the analysts stressed the need for stronger policy direction to unlock the country's full potential.

The discussion, titled "Catalysing carbon financing in Bangladesh: private sector pathways and policy readiness," was held today in Dhaka and organised by international consultancy firm LightCastle Partners.

The event was organised to raise awareness among private sector leaders and investors about the country's readiness for carbon market participation and the implementation of Article 6 under the Paris Agreement.

At the event, Lincoln Teo, managing director of ZERO13, in his presentation emphasised Bangladesh's commitment to combating climate change, citing national goals to produce 16 percent of energy from renewable sources by 2030 and to reduce annual carbon emissions by 89.47 metric tonnes of CO₂e.

He said that achieving these targets would significantly support sustainable agriculture, water management, and overall economic growth.

"While we've set green financing targets and launched refinancing schemes, we must now strengthen public-private cooperation and follow international best practices, with strong banking sector support," said Ahmed Zubaer Mahmud, Additional Director of the Sustainable Finance Department of Bangladesh Bank.

Bijon Islam, CEO of LightCastle Partners, called for innovative financing models aligned with environmental and social impact.

"Carbon financing can unlock new investment channels. But we must rethink how we mobilise capital to support a low-carbon, inclusive economy," he added.