Statistics reveal that the world’s top 1 per cent of emitters produce over 1,000 times more CO2 than the bottom 1 per cent. That number gets starker, as studies reveal, with the richest 0.1 per cent of the world’s population emitting 10 times more than the entire top 10 per cent combined. These figures make one thing explicitly clear: if these top emitters globally continue to maintain such carbon levels, there is no way we can decarbonize fast enough.
Statistics reveal that the world’s top 1 per cent of emitters produce over 1,000 times more CO2 than the bottom 1 per cent. That number gets starker, as studies reveal, with the richest 0.1 per cent of the world’s population emitting 10 times more than the entire top 10 per cent combined. These figures make one thing explicitly clear: if these top emitters globally continue to maintain such carbon levels, there is no way we can decarbonize fast enough.
With COP28 on the horizon, organisations around the world are assessing the progress and challenges in the climate mitigation process. As we know, the Paris Agreement rolled out a framework for developed nations to provide financial, technical, and capacity-building support to the countries that need it. This framework is what gave rise to the concept of climate finance.
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With COP28 on the horizon, organisations around the world are assessing the progress and challenges in the climate mitigation process. As we know, the Paris Agreement rolled out a framework for developed nations to provide financial, technical, and capacity-building support to the countries that need it. This framework is what gave rise to the concept of climate finance.
The United Nations Framework Convention on Climate Change (UNFCCC) defines climate finance as local, national, or transnational financing that helps countries reduce greenhouse gas emissions by funding renewable power such as wind or solar. The uptake of solar power as a renewable resource was slow to begin with due to large upfront costs and availability issues. Over time, however, after governments began awarding tax credits to industries for adopting solar energy systems, an increase in production and government subsidies led to a decrease in the direct costs of solar energy for consumers. Today, renewable energy is more cheaply produced than fossil fuels in some markets. Due to the increasing competition in the solar energy industry, installation costs have also seen a sharp decline, making it a fiscal win for both consumers and large companies globally.
Another form that climate financing takes is through carbon trading and carbon taxes.
Carbon trading involves the buying and selling of credits that allow a company or other entity to emit a certain amount of carbon dioxide. So, for a nation that buys carbon, it buys the right to burn it. While the nation that sells carbon surrenders the right to burn it.
For example, the UNFCCC awarded the Delhi Metro Rail Corporation (DMRC) with carbon credits for reducing greenhouse gas emissions in the city. However, this idea has its own critics and supporters. While cumulatively, greenhouse gas emissions may be reduced and some countries reap economic benefits, critics do not endorse this system as it can create an exploitative environment.
Despite this, the success of DMRC is one example of the many initiatives India has taken to use climate finance in its fight against climate change. While India is on the roster of receiving climate funds from developed nations, many of India’s climate actions have been financed domestically, including the government’s budgetary allocations, market mechanisms, fiscal instruments, and policy interventions. In fact, according to a report submitted to UNFCCC, India’s domestic mobilisation of finance almost completely overshadows the sum of total international funding.
India has been seen taking the lead in representing developing nations’ needs in global summits and forums. Developed nations were required to mobilise $100 billion per year by 2020, which, while far from having been met, has also proved simply insufficient. In lieu of this, India has taken the lead at the UNFCCC to advocate for climate finance in the form of grants instead of loans that many developed nations tend to provide in the name of support. These loans can potentially harm local communities, adding to the heavy debts of countries, especially when interest rates are on the rise. Additionally, India is also insisting on new climate finance targets by 2024, asserting that the required amounts be set in trillions to meet the actual needs of climate change mitigation.
Representatives and experts across the globe will assemble once again at the COP28 UAE soon to rethink, reboot, and refocus the climate agenda. It is crucial for India to emphasise that tackling climate change and financing it is a collective responsibility. Transparent funding mechanisms and fair assistance for developing nations are necessary as they work towards achieving a balance between economic growth and environmental sustainability amid the challenges posed by climate change.
And global leaders need to listen and act before the planet reaches an irreversibly high temperature.
Aishwarya Bhatia is Content Strategist & Writer at Sambodhi Research & Communications, a multidisciplinary research organisation offering data-driven insights to global social development organisations.
