PSC Exams
Latest Exam Update
Coaching
UPSC Current Affairs
Syllabus
UPSC Notes
Previous Year Papers
Mock Tests
UPSC Editorial
Books
Government Schemes
Topics
Bilateral Ties
New Collective Quantified Goal(NCQG) on Climate Finance | UPSC Editorials
IMPORTANT LINKS
|
Analysis based on |
Editorial Interests of some getting prioritised, say developing nations, draw ‘super red line’ published in The New Indian Express on November 21st, 2024 |
|
Topics for UPSC Prelims |
Green Climate Fund (GCF), Climate Investment Funds (CIFs), New Collective Quantified Goal (NCQG), Paris Agreement, Copenhagen Accord, Global Climate Conferences |
|
Topics for UPSC Mains |
Role of UNFCCC and COP conferences, Climate Change, Climate finance, The role of climate finance in achieving SDGs |
What is New Collective Quantified Goal (NCQG)?
The New Collective Quantified Goal refers to the next stage of the financial commitment of developed countries to developing nations in advancing the climate action of the latter. This would be the follow-up commitment to mobilize $100 billion annually by 2020, a commitment undertaken under the Copenhagen Accord in 2009 and reiterated in the Paris Agreement of 2015. The NCQG seeks to revise and step up this financial pledge to meet the changing demands for climate mitigation and adaptation post-2025.
Read the article on the BASIC Countries!
Background of the New Collective Quantified Goal (NCQG)
The concept of the NCQG arose from a common understanding that the initial annual target of $100 billion was not adequate for addressing the holistic needs of developing countries. Today, with the catastrophic impacts of climate change intensifying by the hour, there is an urgent imperative to strengthen financial flows supporting resilient infrastructure, clean-energy transitions, and adaptive measures across vulnerable regions. This NCQG is designed as the more aggressive and responsive financial goal, consistent with the Paris Agreement's sense of urgency and scale to restrict global warming to below 2°C.
Read the article on the UNFCCC COP26!
Significance of the New Collective Quantified Goal (NCQG)
The NCQG carries important implications for global climate governance. It is also a collective expression of the financial scale required to meet climate challenges and is an accountability and transparency mechanism when it comes to climate finance. To developing countries, a strong NCQG is important, as it can help bridge the gap in finances between what is currently possible and the investments required in sustainable development. Moreover, it ensures that the principle of "common but differentiated responsibilities" remains integral to climate negotiations, reflecting the varying abilities and historical responsibilities of countries.
Read the article on the COP 24 UNFCCC!
What is Climate Finance?
Climate finance can be characterized as local, national, or transnational funding from public, private, and alternative sources in support of actions that mitigate or adapt to climate change. Strong climate finance ensures the derivation of solutions to reduce greenhouse gas emissions, as well as for adapting to the impacts of climate change that inevitably occur. Many channels and mechanisms exist for climate finance, including grants, concessional loans, private sector investments, and innovative financial instruments such as bonds and insurance schemes.
Read the article on the UNFCCC COP 28!
Ongoing Disagreements in Climate Finance
The disagreement at COP29 underscores several significant points of contention in climate finance:
- Finance quantum: The Like Minded Developing Countries (LMDCs) group, which includes India and China, demand a significant escalation of financial commitments to at least $1.3 trillion annually after 2025. They consider those devised by developed countries ($200-$300 billion) paltry.
- Expanding the contributor base: The developed nations argue for a much broader contributor base, with emerging economies such as China mobilizing their own climate finance. This proposition has received much resistance, mainly because historically, greenhouse gas emissions had been associated with the developed nations.
- Focus on Mitigation vs. Adaptation: Another noted imbalance is in negotiations, with too much emphasis on the fight to reduce emissions (mitigation) rather than how to adjust to climate impacts (adaptation). The developing countries point out that adaptation is crucial for their survival and development, and so requires equitable financial support.
- Equity and Responsibility: The doctrine of equity, based on the Paris Agreement, stipulates that developing countries have a greater responsibility to share costs owing to their past emissions. Attempts to transfer responsibilities to the developing world violate this doctrine and add to the stresses.
Read the article on the Difference Between the Paris Agreement and Kyoto Protocol!
India's Initiatives for Climate Finance
India has actively engaged in climate finance at both the national and international level:
- Domestic Investments: India has invested very heavily in renewable energy investment and aims at 450 GW of renewable energy capacity by 2030. That involves huge public and private financing.
- International Advocacy: India has been prominent in the international arena, persuading for a more ambitious NCQG, focusing more on equity in climate finance. India is one of the co-founders of the International Solar Alliance (ISA) to support development and deployment of solar energy, mobilizing resources for its member countries.
- Innovative Financial Instruments: India has pioneered green bonds and sovereign green bonds as part of attraction for private investments in sustainable projects.
Read the article on the World Climate and Climate Change!
Global Initiatives for Climate Finance
Several global mechanisms and funds have been established to channel climate finance:
- Green Climate Fund (GCF): It is set up under the UNFCCC; the GCF would support developing countries in their efforts towards climate mitigation and adaptation. It aims to invest in low-emission and climate-resilient development.
- Climate Investment Funds (CIFs): These funds leverage significant financial contributions from donor countries and manage programs such as the Clean Technology Fund (CTF) and the Strategic Climate Fund (SCF) whose funds are used in clean energy and climate-resilient projects.
- Private Sector Engagement: Through initiatives like the Task Force on Climate-related Financial Disclosures (TCFD) and platforms such as climate finance, Climate Action 100+, private sector investments are mobilized through enhancement of transparency and accountability in climate-related risks and opportunities.
Read the article on the COP 24 UNFCCC!
Conclusion
The debates over the New Collective Quantified Goal at COP29 unequivocally unveil the complexity and the geopolitical play of climate finance negotiations. A growing urgency is evident not only in the requirement of climate finance but also in the need for fair and open mechanisms. Developing countries, which are immediately and seriously affected by climate change, demand strong financial support to shift towards more sustainable and resilient economies. As the clock runs down on COP29, the world holds its breath for an outcome that manifests true global solidarity and commitment toward a sustainable future. The results of these deliberations will profoundly influence the future course of international climate action and the ability of nations to rise to the grave threats confronting the planet.
We hope your doubts regarding the topic have been addressed after going through the above article. Testbook offers good quality preparation material for different competitive examinations. Succeed in your UPSC IAS exam preparations by downloading the Testbook App here!