As the 29th edition of the Conference of Parties (COP29) prepares to kick off in Baku, India is set to maintain its strong stance on climate finance, according to The Hindu.
The country will continue advocating for developed nations to increase their financial contributions to support the developing world in adapting to the impacts of climate change. India insists that these commitments should align with the principles established in the Paris Agreement and not deviate from previously agreed-upon terms.
Also read: Climate finance at COP29 may settle in the ‘hundreds of billions,’ say key negotiators
The History of Climate Finance Commitments
At COP15 in Copenhagen, developed countries committed to mobilizing $100 billion annually to support climate action in developing countries by 2020. However, there has been ongoing confusion and debate over what constitutes “climate finance.”
Some countries argue that traditional investments in clean energy projects should count as climate finance. Others believe these investments should be separate from regular financial flows for economic development.
In 2022, the Organisation for Economic Cooperation and Development (OECD) declared that the $100 billion target had been met. But questions remain about whether this funding adequately addresses the climate needs of developing countries, especially in terms of adaptation measures.
Also read: COP29 Announces Key Goals for Climate Finance and Energy Storage Expansion
The Need for More Funding to Meet Paris Goals
Countries have recognized that more funding is needed to meet the ambitious climate goals of the Paris Agreement. The target to reduce global emissions by 45% by 2030 and limit temperature rise to 2°C requires significant financial support. Since 2022, discussions have focused on a new target called the New Collective Quantified Goal (NCQG).
The NCQG aims to provide clearer guidelines for climate finance, including its quantity and delivery by 2025. This new target is expected to be a key discussion point at COP29.
India’s Position on Climate Finance
According to a The Hindu report, India insists that climate finance should include more than just grants. It should also include concessional loans from multilateral banks and investments in green technologies.
Indian officials are concerned that some countries might present business-as-usual activities as climate finance. This is especially true if short-term profit motives drive the financing.
They also worry that rethinking terms like “major economies” could include countries like China and India under the NCQG. This would complicate financing discussions.