$300 billion climate finance target by 2035 is insufficient: Centre

The government has expressed its disappointment with the outcome of COP-29 at Baku, saying the new global climate finance target of $ 300 billion annually by 2035 is "substantially insufficient" to meet the financing needs of developing nations.

Responding to a question in the Lok Sabha, Minister of State for Environment Kirti Vardhan Singh said that the New Collective Quantified Goal on climate finance "does not address the needs and priorities of developing countries" and is "incompatible with the principle of Common but Differentiated Responsibilities and Respective Capabilities (CBDR-RC) and Equity".

He cited estimates of the Standing Committee on Finance under the UN Framework Convention on Climate Change (UNFCCC), which place these needs between $ 5.1-6.8 trillion (equivalent to $ 455-584 billion) per year for up to 2030.

 

The minister said that the categorisation of climate-related outflows and financial efforts by multilateral development banks as contributions to the $ 300 billion goal would include inputs from developing countries themselves, even though the UNFCCC and its Paris Agreement require that "developed countries provide and take lead in mobilising climate finance for developing countries".

He said India has submitted its view on the "Baku to Belm Roadmap to 1.3T", emphasising that the roadmap "must reflect the perspectives and concerns of developing country parties" and that its suggestions "must adhere to the principles of the UNFCCC and its Paris Agreement, including equity, common but differentiated responsibilities and respective capabilities and the principles of Article 9.1 of the Paris Agreement".

COP-29 or the 2024 United Nations Climate Change Conference was held in Baku, Azerbaijan, in November last year. A key item on the agenda was agreeing to a New Collective Quantified Goal (NCQG) on climate finance to replace the $ 100 billion-per-year pledge made by developed countries in 2009.

Parties adopted a target of mobilising at least $ 300 billion annually by 2035, from a mix of public, private, bilateral, multilateral, and alternative sources.

Several developing countries have argued that the $300 billion annual goal is far below the scale of resources required to respond to climate change impacts and transition to low-carbon economies.

Their position is based on UNFCCC assessments, which estimate that their combined needs amount to at least $ 455-584 billion per year until 2030.

Critics also point out that a portion of the $ 300 billion could come from private investment or loans, rather than new and additional public finance from developed countries, which could increase debt burdens instead of providing concessional or grant-based support.

The "Baku to Belm Roadmap to 1.3T" refers to the proposed plan to scale up global climate finance flows to $ 1.3 trillion per year by 2035.

It is meant to guide discussions and technical work between COP-29 in Baku and COP-30 in Belem, Brazil, in November this year. The roadmap is expected to outline milestones, timelines and the balance between public and private finance, and to address the allocation of funds for mitigation, adaptation and loss and damage in developing countries.

India, along with several like-minded developing countries, has sought a higher mobilisation goal of $ 1.3 trillion per year till 2030.

It has said that such a target should be met through public finance from developed countries, should adhere to equity and CBDR-RC, and should avoid counting contributions that originate from developing countries themselves.

Article 9.1 of the Paris Agreement states: "Developed country Parties shall provide financial resources to assist developing country Parties with respect to both mitigation and adaptation in continuation of their existing obligations under the Convention."  This provision makes it a legal obligation for developed countries to take the lead in providing climate finance, reflecting the Convention's principle of CBDR-RC.

The principle of CBDR-RC means all countries share the responsibility to address climate change, but not equally.

Developed countries are expected to take the lead because they have contributed more to the problem historically and have greater financial and technological capacity, while developing countries' responsibilities are adjusted to their capabilities and development needs.