The 197 Parties to the UN Framework Convention on Climate Change (UNFCCC) decided to make it possible to finance loss and damage for those who most need it.
Loss and damage (L&D) fund
- Loss and damage (L&D) refers to the negative effects that vulnerable communities and nations experience as a result of a changing climate.
- Making wealthy nations pay: Rich nations had long rejected L&D payments. They were under so much pressure that they had to accept their accountability.
COP27: Agreement between all parties
- Creation of the Transition Committee: As part of the COP27 agreement, a Transition Committee for L&D was created, with equal representation from wealthy and developing nations.
- Operationalizing the funding arrangement: By COP28 in the UAE next year, the committee must set up institutional arrangements, identify and expand sources of funding, and coordinate with current funding arrangements.
Role India can play in facilitating the Loss & Damage
- Create a Global Vulnerability Index: CEEW created a Climate Vulnerability Index for India last year. It was discovered that more than 80% of Indians are extremely vulnerable to severe weather calamities. These publicly available data aid in the mapping of key vulnerabilities and the development of strategies for enhancing resilience through the climate-proofing of infrastructure, communities, and economies.
- India would be wise to bring professionals together and support the creation of a South-led research consortium that is focused on the scientific investigation of “event attribution” science. This would advance climate research, raise awareness of sensitive areas, increase research capacity in poor nations, and reinforce the L&D framework.
- Promote the Early Warning Systems Initiative: The Early Warnings for All Executive Action Plan, unveiled at COP27. Within five years, it wants to guarantee that early warning systems will protect every individual on Earth. In order to prevent annual losses of $3-16 billion due to natural disasters in developing countries, it has called for targeted investments of $3.1 billion between 2023 and 2027.
- Utilize the CDRI (Coalition for Disaster Resilient Infrastructure): India established the CDRI “to promote the resilience of new and existing infrastructure systems to climate and disaster hazards in support of sustainable development.” In order to facilitate the creation of a comprehensive disaster-risk financing plan in more than 35 nations and multilateral organisations, CDRI is now conducting a Fiscal Risk Assessment research.
Other strategies for Loss & Damage funds
- Pressuring the developing nations: With rising emissions, pressure must also be applied to the major emerging economies to contribute to L&D financing. Increasing adaptation spending is necessary to limit L&D compensation.
- Global Resilience Reserve Fund: To build an insurance buffer against catastrophic physical and macroeconomic shocks that climate threats would impose, the global resilience reserve fund is capitalised using IMF Special Drawing Rights.
- Enhanced and expedited emissions mitigation: Although the world’s nations this week revealed their long-term low-carbon emissions development strategies, they must employ scientific techniques to quantify their long-term targets in order to provide guidance to business and investors.
Conclusion
Loss and damage financing is really a temporary fix. By 2030, global emissions must be cut by 50%, but there is no condemnation for not putting out convincing strategies to do it. India’s Lifestyle for Environment programme promoted sustainable living. Because it is now too late, the world needs to adjust its perspective on climate change.