Due to increasing energy demand, efforts have been made in adopting renewable energy systems (RES) in South Asian countries over the past decade (Kumar et al. 2010; Iqbal and Tabish 2012; Shah et al. 2011). Given the energy crises in Pakistan, there is a dire need to introduce RES in the country. Despite several initiatives undertaken by the Government of Pakistan, successful implementation of RES is still very limited (Mirza et al. 2009). One core reason for this failure is the Government’s concentration on managing old, ineffiecent energy projects and spending heavily on traditional sources of producing energy instead of investing in renewable energy resources and technologies. Also, not much attention has been given to the exploitation of renewable resources, learning opportunities and exchange programmes from neighbouring countries in the region.

Most of the barriers that exist in Pakistan are similar to those in India, Bangladesh, Sri Lanka, and Bhutan. These barriers can be addressed more strategically if RES implemented in other SA countries, such as renewable energy certificates in India (Kumar and Agarwala 2013), are used as  models in Pakistan. Furthermore, collective efforts are required for institutional building at the regional level to address the growing energy demand  in individual countries of the SA region.

Existing research has endorsed that regional cooperation in South Asia plays the most significant role in securing environmentally sound and safe energy development (Alam 2006). This paper critically reviews literature on renewable energy products, technologies and policies in the South Asian region. Building upon existing models of regional cooperation in developed countries (Sawin 2006) such as the European Neighborhood Policy (Emerson 2004) and effectiveness of different policies for different types of renewable technologies (Busch and Jorgens 2012),  this paper offers policy directions for diffusion and adoption of renewable energy systems through regional cooperation in Pakistan.

The paper calls for a comprehensive policy analysis at the government level to identify policy types such as market based policies versus command and control policies to regulate the adoption of RES in the country. Policy instruments  are needed to improve the Feed-in-Tariffs (FIT) system and adopt green energy certificates for increasing electricity generation from RES. The latter can be traded and exchanged across countries such as Sri Lanka, India and Pakistan. There is a need to develop a common renewable energy market between Pakistan and other South Asian countries which promotes trade of renewable technologies and products (e.g. solar panels, wind turbines and hydrogen fuel cells) across the region, and determine a  national and regional tariff structure for importing RE products. South Asian countries can jointly work on RE investment projects, for example, India and Pakistan can mutually invest in developing wind and solar energy by using the Gawadar port in Karachi which provides one of the most potential platforms for generating wind and solar energy (Hameedi 2012; Hassan 2005). India, the fifth largest windmill producer in the world can help Pakistan in manufacturing the windmills by opening subsidiaries initially and then provide technical training to manufacture windmills locally (Hameedi 2012). India and Pakistan have significant potential to carry out RE projects together, but political and geographic disputes hinder such activities. A series of multilateral dialogues are needed to facilitate the trade and diffusion of RES.

Strengthening knowledge management infrastructure across the region to share technical and management issues in adopting RE technologies in individual SA countries; promote research and capacity building for handling RE projects, for example case studies on the issues of implementing RE certificates from India; and encouraging participation in regional and international seminars to understand latest renewable technologies can also be benefical.

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