Etihad Rail, the developer and operator of the United Arab Emirates' (UAE) rail network, has launched a sustainable finance framework, it said on Wednesday, as a possible step towards issuing green bonds to finance lower carbon infrastructure.

Owned by $249 billion Abu Dhabi sovereign wealth fund ADQ, Etihad Rail connects industrial and commercial centres with terminals and major ports.

Once completed, it will have passenger services as well as the freight services already operating and be part of a Gulf-wide railway network, although the completion date has yet to be made public.

Etihad Rail said in a statement the framework launched on Wednesday provided guidelines around green loan and bond principles, the use of proceeds, project evaluation and selection, as well as proceeds management and reporting.

It said the framework would tie future financing to its environmental, social and governance (ESG) strategy, providing guidelines on investments in areas such as clean transportation, green buildings and pollution prevention and control. The UAE, which last year hosted U.N. climate talks and said it planned to invest $54 billion in energy and renewable sources through 2030, is aiming to reach a goal of net zero emissions by 2050.

Reaching the goal is complicated by the Gulf's reliance on hydrocarbons.

Bond-issuers in the region have sought to burnish their environmental credentials by issuing green bonds or other sustainability-linked debt.

Among those to have tapped into the green debt market, last month, Abu Dhabi state-owned renewable energy company Masdar raised $1 billion through a green bond, and major gas producer Qatar launched a $2.5 billion two-part green bond in May.

($1 = 3.6727 UAE dirham)

(Reporting by Federico Maccioni, editing by Jane Merriman and Barbara Lewis)