During the recently concluded COP27 summit, United Nations delegates established a ‘Loss and Damages’ fund, aiming to compensate countries most affected by climate disasters. This move marks a significant step in global efforts to address the impacts of climate change.
‘Loss and Damage’ Funding – What Is It?
‘Loss and Damage’ pertains to the irreversible impacts of climate change which are beyond prevention through either mitigation strategies (reducing greenhouse gas emissions) or adaptation measures (altering ways to withstand climate change effects). It constitutes not just economical property damages but also involves loss of livelihoods, biodiversity devastation and damage to culturally significant sites. This definition expands the compensation claim possibilities for affected nations.
Evolving Notions of Loss and Damage
Debate about climate change-induced loss and damage has been ongoing since the inception of the United Nations Framework Convention on Climate Change in the early 1990s. The Least Developed Countries Group has consistently strived for accountability and compensation for climate-related loss and damage, often met with indifference from affluent nations, who are largely responsible for the climate crisis. In 2013, the Warsaw International Mechanism on Loss and Damages (WIM) was established without funding, driven by pressure from developing countries. The 2021 COP26 climate summit took a step forward by creating a task force to examine loss and damage fund arrangements, sparking interest from nations like Canada, Denmark, Germany, New Zealand, Scotland, and Wallonia province of Belgium.
Concerns Surrounding Fund Establishment
Regarding future COP negotiations, the commitment extends only to creating a fund, leaving the setup details and contributor identities open to discussion. While certain nations have pledged nominal amounts, the estimated Loss & Damage consider already exceeds USD 500 billion. During COP27 negotiations, the European Union strongly urged China, Arab states, and “large, developing countries” (possibly including India) to contribute, given their massive emissions output. There remains no consensus on what constitutes “loss and damage” caused by climate change, which further complicates matters.
Climate Funding and Global Warming
Historically, climate funding has predominantly focused on carbon dioxide emission reduction to halt global warming, with only about a third allocated to projects helping communities adapt to anticipated impacts.
India’s Initiatives Toward Addressing Climate Change
India has launched several initiatives to address climate change. The National Adaptation Fund for Climate Change was established in 2015 to cover the climate change adaptation costs for Indian States and Union Territories especially vulnerable to climate change. The National Clean Energy Fund works to promote clean energy, funded initially through an industry carbon tax on coal use. Governed by an Inter-Ministerial Group with the Finance Secretary as Chairman, its mandate includes funding research and development of innovative clean energy technology in both fossil fuel and non-fossil fuel sectors. The National Adaptation Fund, created in 2014 with a starting corpus of Rs. 100 crores, aims to bridge the gap between climate-related needs and available funds. This fund operates under the Ministry of Environment, Forests, and Climate Change.
Maintaining Momentum and Looking Forward
While the establishment of a ‘Loss and Damages’ fund represents progress, countries must continue striving for effective COP meetings to ensure they’re not just token victories. Sustaining political commitment to securing new finances is essential, as is targeting these funds at reducing emissions and vulnerability. Lessons must be learned from recent experiences, particularly as the Green Climate Fund enters operation.
UPSC Civil Services Examination, Previous Year Questions
Potential questions related to this topic have appeared in the UPSC Civil Services Examination, including a 2019 question regarding ‘methane hydrate’ deposits, and questions from the 2021 examination about the Green Grid Initiative launched at the COP26 UN Climate Change Conference in Glasgow.
Last Modified: February 18, 2024