United Nations, February 14, 2025 – Pakistan has said that although private sector financing can play a key role in bridging the SDG financing gap, yet developing countries will be unable to attract sufficient private investment to achieve the SDGs unless they are able to build a pipeline of viable bankable projects, which are sufficiently profitable. Senator Farooq H. Naek stated this while delivering national statement at the 2025 IPU Hearing on the subject of ‘Private investment for the SDGs: The role of private long-term investment and of international finance’, at the UN headquarter today. Mr. Naek is heading a six-member parliamentary delegation to represent Pakistan during the two-day 2025 IPU Hearing. He highlighted the need for capacity building support to developing countries to enable them to formulate a pipeline of such projects. He, however, added that incentivising the private sector to invest in developing countries while mitigating its potential negative consequences, is a delicate balancing act. “On the one hand, private sector investment drives economic growth, innovation, and job creation. On the other hand, unchecked or poorly managed private investment can lead to environmental degradation, social inequalities, and economic volatility,” he explained. In order to incentivise private sector investment, the Pakistani Senator outlined several policy actions such as crafting clear, consistent, predictable and enforceable laws that outline the rules of investment; offering targeted tax breaks or subsidies to promote private investment in sectors that align with national development goals; investing in public-private partnerships (PPPs) and incentivising adherence to environmental, social and governance standards. He urged the governments to leverage blended finance mechanisms that combine public funds with private capital to support development projects that have a strong social or environmental impact but are perceived as too risky for private investors. “In order to foster innovation and job creation, they can support SMEs through low-interest loans and guarantees,” he held.