Access to climate finance and technology in developing countries is a “must-have” to protect the earth and humanity from apocalyptic changes, India said at the ongoing UN climate summit in Egypt on Monday.
Making an intervention at the High-Level Ministerial Dialogue on Climate Finance at COP27, Union Environment Minister Bhupender Yadav said a clear definition of climate finance is needed to promote transparency and trust in all multilateral discussions to address climate change.
“Access to finance and technology in developing countries is a must-have if we expect to protect our earth and ourselves from apocalyptic changes. The commitment made by the developed countries to mobilize USD 100 billion from diverse sources by 2020 was a meager amount and remains unachieved till now. The current needs of developing countries are estimated to be in the order of trillions,” a statement quoted him as saying.
At COP15 in Copenhagen in 2009, developed countries committed to jointly mobilize USD 100 billion per year by 2020 to help developing countries tackle the effects of climate change. Rich countries, however, have repeatedly failed in delivering this finance.
Developing countries, including India, are pushing rich countries to agree to a new global climate finance target — also known as the new collective quantified goal on climate finance (NCQG) — which they say should be in trillions as the costs of addressing and adapting to climate change have grown.
India also sought clarity on the definition of climate finance — the absence of which, experts say, allows developed countries to greenwash their finances and pass off loans as climate-related aid.
“There are several estimates of climate finance. The OECD (Organisation for Economic Co-operation and Development) estimates the flows to be USD 83.3 billion in 2020 and USD 79.9 billion in 2018, while Oxfam estimates the mobilized amount to be USD 19 to 22.5 billion per year in 2017-18. Other estimates from UNFCCC are USD 45.4 billion in 2017 and USD 51.8 billion in 2018.
“Evidently, there is no understanding of what really comprises climate finance. Having a clear definition of climate finance will promote transparency and trust, vital for furthering constructive deliberations. While we take note of the work carried out by the Standing Committee on Finance, there is a need to further work in arriving at a meaningful definition of climate finance,” Yadav said.
The minister said slow disbursements, lack of flexibility and long complex approval procedures with stringent eligibility criteria make access to climate finance difficult.
“It is not the absence of a bankable project pipeline, but the procedures, inflexibility in approach, and lack of trust with respect to direct access entities that is a problem,” Yadav said.
He said the NCQG for the post-2025 period needs to be an ambitious mobilization target at “grant/concessional” terms.
“We require an ambitious flow of financial resources from various sources – public and private – with the developed countries playing a pivotal role in incentivizing flows to the developing countries so that finance – the key means of implementation – is at grant/concessional rates.
“The nationally determined contributions and the needs determination reports could be a good basis to estimate the requirement,” the minister added.
Coming into COP27, Yadav had said that India does not recognize loans to be climate finance because it pushes vulnerable countries further into debt. “Our focus at COP27 during our negotiations is thus on concessional and climate-specific grants,” he had said.