Environmental Governance and Sustainability (EG&S)
Course Code: EPGP16
Instructor: L. Venkatachalam
venkat@[Link]
Mobile: 7358546655
Objectives of the Course
To acquaint the students with various environmental issues using an interdisciplinary approach,
To enable the students, who are on the threshold of becoming active participants in society as
citizens, decision-makers and leaders (LIFE!)
To develop a framework to analyze the public policy issues related to environment and to prepare
them to find appropriate ?grand? policy solutions
Session 1: Introduction to Environmental Management and sustainable Development
A critique of sustainable development (SD) ?the concept of SD, different forms of capital and role of
?natural capital? in achieving SD;
Local, regional & trans-boundary water issues and how these issues affect SD in India (and how
such framework can be extended to other environmental resources ?e.g. forests, biodiversity, etc)
Course Outline
Session 2: Scope of market mechanism in environmental management
Institutions for environmental management
Institutions and transaction costs (government, markets and NGOs such as, legal system)
Role of Property rights in achieving SD
Course Outline
Session 2 (Contd.): Collective action & property rights for sustainable development
Various types of property regimes ? Public, private, common property & open-access resources
Collective action and social capital
Elinor Ostrom?s work on commons
Common property, local livelihoods & land acquisition
Course Outline
Session 3: Institutional failures (market and governments) and environmental problems, and
internalization of environmental externalities
Reasons for market failures
Public goods, externalities
Correcting market failures
Command and control
Market-based instruments
Government failure; failure of other institutions
Public Interest Litigation (PIL)
Course Outline
Session 4: Environmental Issues and Policy Measures
Case Studies on Economic Instruments for Environmental Management ?Social benefit-cost
Analysis -Economic Valuation of Ecosystem Services
Economic Instruments for Environmental Management ?Payment for Ecosystem Services (PES)
Course Outline
Session 5 and Session 6: Presentation and Discussions on Term Papers
Course Outline
Evaluation
Online Assessment (3 Quizzes ?best 2 out of 3: MCQ)? 20%
Term Paper (Group Project)? 30%
Final Examination ? 50%
Objective type questions ?Shor Answer (5 marks) and Long Answer (10 marks) Questions
Term paper presentation
A group of 5-6 students; the members will be selected randomly;
Analyze local / regional / national / international environmental issues (remedial
policies/interventions) & opportunities (i.e., new business opportunities, nature-based solutions, etc)
Evaluation based on the application of theoretical concepts/ analytical frameworks discussed in
Sessions 1 to 4.
Evaluation of term paper
ORIGINAL PIECE OF WORK- NO PLAGIARISM : Write the source of literature referred to as
footnotes/endnotes
REFERENCING IS THE KEY!
Kumar, A. and Irfan, Z.B., 2018. Assessment of the Sustainable Livelihood Security of the
Ecologically Vulnerable Indian State? Uttarakhand. Asian Journal of Geological Research, 1(3),
pp.1-8.
All in a group will present? random call of a group for presentation, followed by discussion
Report size ? Maximum 3000 words
Two model reports are available on the Moodle.
Session 1: Environmental Management and Sustainable Development
Environmental Governance
All environmental problems are due to ?anthropogenic factors? (?human behavior?) and therefore,
human behavior has to change!
Current pattern of consumption is a major culprit.
EG seeks policies, rules and norms that alters the human behavior and bring collective action
towards sustainable development;
Addresses who makes decisions, how decisions are made and the scientific information (Natural
Resource Accounting, Environmental Impact Assessment, Environmental Performance Index,
economic valuation, etc) needed for decision-making; and
Identifying the major stakeholders and making them participate in the decision-making (e.g.
Payment for Ecosystem Services)
Growth ?GOOD! But at what cost?
India to become US$ 7 trillion economy by 2030! What about the environmental consequences of it?
Economic Growth ? Necessary or sufficient condition for human well-being?
But, high growth causes serious environmental problems that constrain further growth
FIVE environmental challenges: Air Pollution, Climate Change, Water Pollution, Biodiversity Loss,
Nature of Development
Lancet Committee Report (2019): nearly 16.70 lakh deaths per year in India due to air pollution
(water pollution killed another 5 lakh)
Cost of lost productivity due to air pollution: US$ 36.8 billion (Rs. 2870.4 billion)
Cost of treatment: US$ 11. 96 billion (Rs. 932.88 billion)
How many still carry the diseases caused by air and water pollution?
With changes in climate conditions?
Devastating floods in many states in 2021;
Frequent cyclones (Fani, Gaja, Okki, etc) causing wide range of damages to agriculture, properties,
human lives and wildlife!
Prolonged droughts (Vidharba, etc) causing farmers? suicides across the country
Acute water scarcity in Chennai, Bengaluru, etc affecting industry, service sector, household
activities, etc
Heat waves (China, UK, Iran, Qatar, etc) and floods (Pakistan, Bangladesh, etc) across the globe
In what way do environmental problems affect business and economic growth?
Who faces the brunt of depletion, degradation and devastation?
In what way the human behavior responsible for the above issues can be changed?
Inter-generational Equity: Environmentalism of Poor
Poor depends largely on CPRs (Jodha, 1985)
Based on data from over 80 villages in 21 districts in dry regions of seven states in India, the study
reveals significant contribution of CPRs (village forests, pastures, wastelands, etc) towards the
employment and income generation for the rural poor
Between 84 and 100 per cent poor collect food, fuel, fodder and fiber from CPRs
Income from CPRs contributed more than 80 percent of the income of rural poor
The size of income from CPRs is much higher than the income from all poverty alleviation
programmes
But, the area of CPRs has declined by 26 to 52 per cent due to privatization, decline in productivity,
etc.
Do you think absolute poverty is eliminated from India?
Business-Environment Linkage
Business is all about acquiring and deploying diverse resources for producing goods and services
and then reaching them to consumers to meet their needs while earning economic surpluses
Extraction, production/consumption, disposal are essentially interlinked components
So are the factor markets: land/Natural Capital, labour/Human capital, Financial capital
Processes are governed by larger market forces, policy environment that governs national and
international exchanges (rules-of-the-game)
State of the environment affects, conditions, enables and also becomes raison d?etre for the above
processes - Business is hence not immune to the environmental concerns
Sustainable Development
?Development that meets the needs of the present without compromising the ability of future
generations to meet their own needs? (Bruntland Commission, 1987).
The above definition insists on both intra-generational and inter-generational equity in terms of
management of environment
Protecting the environment (such as forests) should not deny the opportunities for current
generation depending on the forest benefits (Intra-generation equity)
Improving the well-being of the current generation (by using up environmental resources) should not
deny the opportunities for the future generations (Inter-generational equity).
So, Sustainable Development (SD) implies!
Development versus environment argument?is no longer valid
SD prescribes development and environment to go hand-in-hand
Environmental and development benefits will have to expand
Protecting environment is the pre-requisite for sustainable development!
Criticisms of SD:
Criticisms of the above definition:
How do we define 'needs?- my needs are different from your needs?
Whose needs?
Which future generation are we concerned about ?the immediate next generation or 10th
generation?
Tastes and preferences are not constant across generations (therefore, their preference over
environment may be different from that of the current generations)
So, operationalizing SD is difficult!
Alternative definition of SD
Income-based definition: that part of income which a person can consume during a week and still
expect to be well-off at the end of the week (Hicks, Nobel Laureate in Economics, 1972)
Meaning: Economic welfare should be at least constant over a period of time (Hicks, 1946)
Alternative definition of SD
Economic Welfare is measured mainly in terms of real income (inflation adjusted)
The above implies that the ?real income? of the nations (i.e. net domestic product (NDP) at constant
prices) should not decline over a period of time
How to sustain ?real income? or NDP?
Sustainable Development
Economic welfare can be maintained only if capital stock of an economy can be maintained
Total Capital Stock of an economy consists of:
Man-made capital (produced capital, financial capital, etc) = MC
Human Capital (education, knowledge, skills, etc) =HC
Natural capital (all natural resources, ecosystem services, etc) =NC
Social Capital (trust, cooperation, reciprocity, etc) =SC
Issue
Should we maintain total capital stock to achieve SD, which implies increase in one form of capital
(e.g. MC) to compensate decrease in another form (e.g. NC)? ? Are the capitals substitutable?
Should we maintain each form of capital independent of each other?
Should maintain Natural Capital stock intact?
There are four different views on the above questions!
SD: Maintenance of capital
For simplicity sake, let us
consider only the man-made
and natural capital
Four major forms of SD:
Very Weak Sustainability
Hartwick-Solow Rule: Development requires that part of the proceeds from the mining of natural
capital be invested in other forms of capital so that development can be sustained.
Economic value of the overall capital to be maintained ?no need to maintain the value natural capital
stock as long as the value of man-made capital stock grows
Reduction in natural capital can be compensated by increasing mad-made capital stock
(deforestation is good as long as we build cement factories that can more than compensate the
income loss from reduced forest cover)!
Very Weak Sustainability
Substitution between man-made capital and natural capital, and technology play a role in enhancing
SD
Environment system is a subset of the economic system and any crisis in the sub-system will be
offset by the economic system
Human beings are rational and therefore, they are capable of finding solutions to environmental
problems (Julian Simon)
We have brains to launch Chandrayaan 2 but can?t we have the brains to solve the water scarcity
problem?
Very Weak SD is based on Environmental Kuznets Curvey Hypothesis!
Grow now Environment later- Environmental Kuznets Curve (EKC) Hypothesis (Simon Kuznets
?Nobel Laureate in Economics, 1971)
EKC suggests?
During initial level of development, we need to accept certain level of environmental problems
Income growth is important for achieving poverty reduction and other development goals
Once we achieve an high level of per capita income, then we will be able to improve the
environmental quality
Problems with EKC assumption
EKC does not hold true for many environmental problems
That level of PC income required for reversing the environmental deterioration is either not known or
very high which cannot be achieved
Irreversibility problem with many environmental resources
Indeed, improving the environmental quality leads to increased income
Very Weak SD:
Induced Innovation Hypothesis: Esther Boserup found that when population growth leads to food
crisis, people try to innovate and produce more food. Similarly, when the environmental sector is in a
crisis a better solution will be found!
Weak Sustainability
The welfare potential of the overall capital (combined man-made and natural capital) remains intact
but, due attention for the natural capital stock is to be given
Emphasize on the irreversibility of natural capital and hence, the principle of ?precautionary
principle? and ?polluter-pays principle?
Precautionary Principle: ?Where there are threats or potential threats of serious social impact, lack
of full certainty about those threats should not be used as a reason for approving the planned
intervention or not requiring the implementation of mitigation measures and stringent monitoring.?
Vanclay F., 2003. SIA Principles - International Principles For Social Impact Assessment. Impact
Assessment and Project Appraisal, 21(1):5?11. Beech Tree Publishing,: Surrey, UK.
Weak SustainabilityContd?..
Polluter Pays Principle: "The full costs of avoiding or compensating for social impacts [that will result
from the planned intervention] should be borne by the proponent of the planned intervention.?
Prescribes ?property rights? for protecting the environment
Recognizes not only monetary value but also values of non-consumptive uses (e.g. existence value)
because there are environmental values which cannot be measured in money terms
Weak SD: Compute Green GDP to monitor SD
GDP (Gross Domestic Product) does not include the value of the economic benefits of the
environment
GDP does not make any allowance for depreciation of natural capital
GDP still contains ?environmental damage costs?
GDP includes market goods and services enhanced by negative environmental impacts (more
disease caused by water and air pollution leads to more purchase of medical services which in turn
?increase? GDP)
Computing ?Green GDP? ?the Framework
Green GDP = conventional GDP ? Depreciation of man-made capital + non-market environmental
benefits ?environmental damage cost ? environmental defensive expenditures
GDP ?depreciation of man-made capital =Net Domestic Product (NDP)
Non-market envl. Benefits = Environmental benefits not sold and purchased but used in production
and consumption activities (e.g. recreational service of forests)
Envl. damage cost: health cost, loss of biodiversity, groundwater over-exploitation, etc
Envl. Defensive expenditure: precautionary expenditure against environmental pollution, etc
Economic Damage: GDP adjustment Brandon and Homman (1996)
Mani, Muthukumara (2013) ?Greening India?s Growth: Costs, Valuations, and Trade-offs?,
Routledge, London
Around 5.5 per cent of India?s GDP (Rs. 2.18 trillion in 2015) is treated as damage cost
Can we sustain GDP growth with a significant environmental destruction?
Strong Sustainability
Natural capital to be maintained independent of man-made capital (no substitution!)
Man-made and natural capitals are complements, not substitutes
Trawlers as man-made capital can function only if you have adequate fish (natural capital) in the
ocean
Sawmills as man-made capital can function if forests (natural capital) exist
Strong SustainabilityContd?.
Technology is not a solution but is problematic for the environment
Air conditioners and refrigerators cause global warming problems!
Bio-physical/ecological limits of the environment to be recognized
Rate of regeneration and rate of extraction to be equal- dynamic steady state
Very Strong Sustainability
Malthusian framework: Population is the cause for all environmental problems ?food scarcity is a
major issue
Like human beings, the nature also has equal right for survival and therefore, don?t use them!
?Intrinsic values? do matter and not ?instrumental values?
Natural capital should not decline at all!
Economic system is a sub-set of environmental system
Essential consumption, equitable distribution income, and control of population are the solutions
Global warming is ?public bad? ?caused by all and affecting all ?but disproportionately
i) For a given global emissions trajectory, the distribution of impacts across the nations is
independent of emissions profile of each nation,
ii) The impacts are felt over a long time horizon due to the long life of greenhouse gases in the
atmosphere
So, Intergenerational and intra-generational equity are important
[Link]
Global Environmental Change/Climate Change
Eternal dilemma
Life, Livelihoods, Technology, Business, Politics, Policy all at stake
How do we address?
Who addresses and at what scale?
ECONOMIC LOSSES
Global Context: Climate Change/Economic value/Global value/World
GDP by 2050
Indian Context: Climate Change/Climate relevant events/ Flood and
Rainfall impact/Economic Loss/Human loss
Indian Context: Climate Change /People facing risks/Sea level rise -
Agriculture sector and fisheries and water stress and poor water supply
Economic Impacts of Climate Change ? Average real GDP loss by 2050
Cost of Climate Change on GDP ? Comparison between World level and
India level
The cost of Global Warming
Breakdown of Recorded Economic Losses (US$) Per disaster type 1998-
2017
IPCC - Risks in the near term (2021?2040)
IPCC - Mid to Long-term Risks (2041?2100)
World's most polluted countries & regions -Most polluted country and
region ranking based on annual average PM2.5 concentration (?g/m³)
How Climate change can impact GDP and jobs
The Climate and Biodiversity Crisis
Global Goal for Nature: Nature Positive by 2030
Race to Zero
References
Global Context: Climate Change/Economic value/Global value/World GDP by 2050
The Global cost of Climate Change damage is estimated to be between $1.7 trillion and $3.1 trillion
per year by 2050 (World Economic Forum -WEF, 2023).
Over the past 20 years, extreme weather events, like hurricanes, floods and heat waves, have cost
an estimated $2.8 trillion, according to a new study (WEF, 2023).
Damages from 185 studied events from 2000 to 2019 averaged around $143 billion per year, which
breaks down to around $16.3 million per hour (WEF, 2023).
Per year, the damage costs ranged from the low of $23.9 billion in 2001 to the highest annual cost
of $620 billion in 2008 (WEF, 2023).
Human-related climate change could be linked to a net of $260 billion in damages from the 185
studied events, or about 53% of total damages (WEF, 2023).
The majority of the climate change-related damages were connected to storms like hurricanes, while
16% of damages were linked to heat waves (WEF, 2023).
Flooding and drought each made up 10% of net damages, and wildfires were linked to 2% of
damages (WEF, 2023).
The largest impact of climate change is that it could wipe off up to 18% of GDP of the worldwide
economy by 2050 if global temperatures rise by 3.2°C, the Swiss Re Institute warns (WEF, 2023).
Indian Context: Climate Change/Climate relevant events/ Flood and Rainfall impact/Economic
Loss/Human loss
The IPCC Working Group (WG)-II (IPCC, 2022b) report states that multiple channels through which
climate change impacts the Indian economy has been documented in the literature, which is still
evolving. India, being among the top 10 economies in terms of vulnerability to climate risk events, is
already witnessing the adverse impact of climate change on its people?s lives and livelihood.
For instance, in 2019, India lost nearly US$ 69 billion due to climate related events, which is in sharp
contrast to US$ 79.5 billion lost over 1998-2017 (UNISDR, 2018).
Floods in India during 2019 affected nearly 14 states causing displacement of around 1.8 million
people and 1800 deaths.
Overall, around 12 million people were impacted by the intense rainfall during the monsoon season
in 2019 with the economic loss estimated to be around US$ 10 billion.
Additionally, the SWM rains in recent years have often been companied by significant temporal and
spatial dispersions causing crop damages, thereby leading to higher food inflation and its volatility
(Dilip and Kundu, 2020; Ghosh et al., 2021).
Indian Context: Climate Change/People facing risks/Sea level rise- Agriculture sector and fisheries
and water stress and poor water supply
The IPCC Working Group (WG)-II (IPCC, 2022b) report states that India is one of the most
vulnerable countries globally in terms of the population that would be affected by the sea level rise.
By the middle of the present century, around 35 million people in India could face annual coastal
flooding, with 45-50 million at risk by the end of the century (World Bank, 2021).
Further, the agriculture sector and fisheries would face significant adverse consequences due to the
rising sea level and ground water scarcity.
In terms of ecosystem services, around 600 million of India?s population are facing severe water
stress, with 8 million children below 14 years in the urban India at risk due to poor water supply (Niti
Aayog, 2019) (RBI, 2023).
Economic Impacts of ClimateChange ? Average real GDP loss by 2050
Climate change could directly cost the world economy $7.9 trillion by mid-century as increased
drought, flooding and crop failures hamper growth and threaten infrastructure.
Its analysis, which assesses each country's direct exposure to loss as climate change brings more
frequent extreme weather events, found Africa was most at-risk, with 4.7 percent of its GDP in the
balance.
In general, developing nations faired poorer in terms of resiliency than richer ones. "Being rich
matters," John Ferguson, EIU country analysis director, told AFP. "Richer nations are really able to
be more resilient towards the impacts of climate change, so this really threatens growth trajectories
of the developing world as they try to catch up with the developed world.
"When we are already dealing with global inequality, for the impacts of climate change the
developing world's challenges are much greater," he added (Economist Intelligence Unit, 2019).
Cost of Climate Change on GDP ? Comparison between World level and India level
The effects of climate change on the physical world often take centre stage in discussions
surrounding it.
But what about its economic consequences? It is estimated that India could account for about 3.4
crore of the projected eight crore global job losses from heat stress by 2030.
The Reserve Bank of India?s latest report suggests that up to 4.5 per cent of India?s GDP could be
at risk by 2030, owing to lost labour hours from extreme heat and humidity.
In Agriculture the Climate change can severely disrupt crop cycles and can cause low agricultural
yield. Agriculture, with its allied sectors, is the largest source of livelihood in India and contributes
significantly to the economy.
Low yields can hit the rural economy and push inflation in urban areas as well. In Industry There
could be an increase in operational costs and a reduction in profits in the industrial sector.
The reasons for high costs can be the imposition of new climate-friendly regulations, reduced
utilisation of old stock, and diversion of investment towards greener infrastructure.
Relocation of production processes and activities due to climate-related losses can also add to the
economic loss.
In services the pressure on financial services, increased insurance claims, and disruptions in travel
and hospitality can pose multiple threats to the service sector.
The cost of Global Warming
The year 2020 was the second warmest on record.
It also saw a record-breaking 22 natural disasters that cost over USD one billion each ? six more
than any other year recorded.
For comparison, the 2010s averaged 12 such disasters per year and the 2000s averaged six per
year.
The financial impact of the climate crisis is becoming ever-more pronounced for states, industries
and individuals alike, and it could get worse as the earth continues to warm.
Scientists at the United States Environmental Protection Agency (US EPA) note that estimating the
impact of climate change and its associated costs is challenging due to the difficulty of separating
damages that are caused by natural variability in the climate system from those that were made
more frequent or intense because of climate change.
However, there is strong evidence that climate change contributed to certain events in 2020,
including the wildfires in the American West and Australia and the strength of Atlantic hurricanes.
There is significant variability in the potential costs of climate change, particularly if carbon
emissions are not addressed.
According to US EPA scientists, projected damages could range in the hundreds of billions annually
by the end of the century under a high emissions scenario; however, projected damages would be
substantially lower if adaptation measure were put in place and emissions decreased.
The potential costs are also not distributed equally. ?If you happen to be in low coastal areas,
climate change may catastrophically affect your budget because you may lose your home,? says
Hietanen.
?If you are a farmer in an area where you cannot continue farming, you may lose your living.
If you are in an area that may get more rainfall, the impact may be zero or even positive? It?s maybe
fair to say that areas which are already rather dry, or areas where the average income is lower, will
be hurt the most?.
Breakdown of Recorded Economic Losses (US$) Per disaster type 1998-2017
Economic losses caused by climate-related disasters have soared by about two and a half times in
the last 20 years, the United Nations said on Wednesday.
From 1998 to 2017, direct losses from all disasters totalled $2.9 trillion, of which 77 percent was due
to extreme weather that is intensifying as the world warms, the U.N. Office for Disaster Risk
Reduction (UNISDR) said in a report.
That compares with overall losses of $ 1.3 trillion from 1978 to 1997, 68 percent of that accounted
for by climate and weather hazards, including storms, floods and droughts.
?We can see that climate change is playing an increasingly important role in driving up disaster
losses around the world, and that probably will be the case in the future as well, ? said Ricardo
Mena, an official at the Geneva-based UNISDR.
Climate Scientist warned that if global average temperatures rise more than 1.5° Fahrenheit above
re-industrial times, it would lead to more suffering ? especially among the world?s poorest.
The planet has already heated up by about 1° Celsius (CRED, UNISDR, 2018 - Economic Losses,
Poverty and Disasters 1998-2017)
Global warming, reaching 1.5°C in the near-term, would cause unavoidable increases in multiple
climate hazards and present multiple risks to ecosystems and humans (very high confidence).
The level of risk will depend on concurrent near-term trends in vulnerability, exposure, level of
socioeconomic development and adaptation (high confidence).
Near-term actions that limit global warming to close to 1.5°C would substantially reduce projected
losses and damages related to climate change in human systems and ecosystems, compared to
higher warming levels, but cannot eliminate them all (very high confidence). (Figure SPM.3,
Box SPM.1) {16.4, 16.5, 16.6, CCP1.2, CCP5.3, CCB SLR, WGI AR6 SPM B1.3, WGI AR6
Table SPM.1} (IPCC, 2022)
IPCC - Risks in the near term (2021?2040)
IPCC - Mid to Long-term Risks (2041?2100)
Beyond 2040 and depending on the level of global warming, climate change will lead to numerous
risks to natural and human systems (high confidence).
For 127 identified key risks, assessed mid- and long-term impacts are up to multiple times higher
than currently observed (high confidence).
The magnitude and rate of climate change and associated risks depend strongly on near-term
mitigation and adaptation actions, and projected adverse impacts and related losses and damages
escalate with every increment of global warming (very high confidence). (Figure SPM.3) {2.5, 3.4,
4.4, 5.2, 6.2, 7.3, 8.4, 9.2, 10.2, 11.6, 12.4, 13.2, 13.3, 13.4, 13.5, 13.6, 13.7, 13.8, 14.6, 15.3, 16.5,
16.6, CCP1.2, CCP2.2, CCP3.3, CCP4.3, CCP5.3, CCP6.3, CCP7.3} (IPCC, 2022).
Projected estimates of global aggregate net economic damages generally increase non-linearly with
global warming levels (high confidence).
The wide range of global estimates, and the lack of comparability between methodologies, does not
allow for identification of a robust range of estimates (high confidence).
The existence of higher estimates than assessed in AR5 indicates that global aggregate economic
impacts could be higher than previous estimates (low confidence).
Significant regional variation in aggregate economic damages from climate change is projected
(high confidence) with estimated economic damages per capita for developing countries often higher
as a fraction of income (high confidence)
Economic damages, including both those represented and those not represented in economic
markets, are projected to be lower at 1.5°C than at 3°C or higher global warming levels (high
confidence). {4.4, 9.11, 11.5, 13.10, Box 14.6, 16.5, CWGB ECONOMIC} Ref: (IPCC, 2022)
Financial constraints are important determinants of soft limits to adaptation across sectors and all
regions (high confidence).
Although global tracked climate finance has shown an upward trend since AR5, current global
financial flows for adaptation, including from public and private finance sources, are insufficient for
and constrain implementation of adaptation options especially in developing countries (high
confidence).
The overwhelming majority of global tracked climate finance was targeted to mitigation while a small
proportion was targeted to adaptation (very high confidence). Adaptation finance has come
predominantly from public sources (very high confidence).
Adverse climate impacts can reduce the availability of financial resources by incurring losses and
damages and through impeding national economic growth, thereby further increasing financial
constraints for adaptation, particularly for developing and least developed countries (medium
confidence). {Figure TS.7, 1.4, 2.6, 3.6, 4.7, Figure 4.30, 5.14, 7.4, 8.4, Table 8.6, 9.4, 9.9, 9.11,
10.5, 12.5, 13.3, 13.11, Box 14.4, 15.6, 16.2, 16.4, Figure 16.8, Table 16.4, 17.4, 18.1, CCP2.4,
CCP5.4, CCP6.3, CCB FINANCE} (IPCC, 2022)
Adaptation does not prevent all losses and damages, even with effective adaptation and before
reaching soft and hard limits. Losses and damages are unequally distributed across systems,
regions and sectors and are not comprehensively addressed by current financial, governance and
institutional arrangements, particularly in vulnerable developing countries.
With increasing global warming, losses and damages increase and become increasingly difficult to
avoid, while strongly concentrated among the poorest vulnerable populations. (high confidence)
{1.4, 2.6, 3.4, 3.6, 6.3, Figure 6.4, 8.4, 13.2, 13.7, 13.10, 17.2, CCP2.3, CCP4.4, CCB LOSS (IPCC,
2022).
Opportunities for climate resilient development are not equitably distributed around the world (very
high confidence).
Climate impacts and risks exacerbate vulnerability and social and economic inequities and
consequently increase persistent and acute development challenges, especially in developing
regions and sub-regions, and in particularly exposed sites, including coasts, small islands, deserts,
mountains and polar regions.
This in turn undermines efforts to achieve sustainable development, particularly for vulnerable and
marginalized communities (very high confidence). {2.5, 4.4, 4.7, 6.3, Box 6.4, Figure 6.5, 9.4,
Table 18.5, CCP2.2, CCP3.2, CCP3.3, CCP5.4, CCP6.2, CCB HEALTH, CWGB URBAN} (IPCC,
2022)
World's most polluted countries & regions -Most polluted country and region ranking based on
annual average PM2.5 concentration (?g/m³) - PM2.5 legend
How Climate change can impact GDP and jobs
?Preserving food and energy security amidst extreme climatic events while obtaining access to
technology and critical raw materials required for successful green transition will, therefore, remain a
key policy challenge for India,? says Shaktikanta Das, governor, RBI.
With various policy approaches, like incentivising green financing, introducing green bonds and
creating a market for carbon credits, the RBI and the financial sector regulators have increasingly
focussed on risks to financial stability from climate change.
However, estimates suggest that annual green financing requirement could be about 2.5 percent of
the GDP to address the infrastructure gap caused by climate events, which could increase if faster
carbon emission reducing goal has to be pursued than what is committed under the NDC.
Nationally determined contributions or NDCs are at the heart of the Paris Agreement, embodying
efforts by each country to reduce national emissions and adapt to the impacts of climate change.
In line with the target of net zero carbon emissions by 2070, India?s NDC aims at raising the share
of renewable energy and reducing the carbon emissions intensity of GDP by 2030.
India presented its Long-Term Low Emission Development Strategy at the COP27, covering plans
for the expansion of green hydrogen production, electrolyser manufacturing capacity and increased
use of biofuels.
India may lose anywhere around 3 to 10 percent of its GDP annually by 2100 due to climate change
in the absence of adequate mitigation policies.
?The real challenge for India will be in arranging new investment, estimated to be in the range of
$7.2 trillion (baseline scenario) to $12.1 trillion (accelerated scenario) till 2050,? the RBI?s DEPR
says.
The cumulative total expenditure for adapting to climate change in India is estimated to be `85.6
lakh crore (at 2011-12 prices) by 2030, according to projections by the ministry of environment,
forest and climate change (MoEF&CC).
The Climate and Biodiversity Crisis
One million plants and animals are threatened with extinction. 1-2.5% of birds, mammals,
amphibians, reptiles and fish have already gone extinct; population abundances and genetic
diversity have decreased; and species are losing their climatically determined habitats. The Earth
has already warmed by 1.2°C since pre-industrial times.
While climate change has not been the dominant driver of the loss of biodiversity to date, unless we
limit warming to less than 2°C, and preferably 1.5°C, climate change is likely to become the
dominant cause of biodiversity loss and the degradation of ecosystem services in the coming
[Link] 50% of warmwater corals have already been lost due to a variety of causes.
Two Broad Solutions:
Mitigation
Adaptation
Climate Change Mitigation
Mitigation is a human intervention to reduce the sources or enhance the sinks of greenhouse gases.
Effective mitigation will not be achieved if individual agents independently advance their interests..
Many areas of climate policy-making involve value judgements and ethical considerations. Climate
policy intersects with other societal goals creating the possibility of co-benefits or adverse side
effects. These intersections, if well-managed, can strengthen judgments as the basis for undertaking
climate action.
At the international level, afforestation and reforestation have been initially recognized as mitigation
approaches and have been promoted for carbon sequestration goals. However, they can also help
forests to adapt to climate change by decreasing human pressures (for example by reducing the
destruction or degradation of habitats), enhancing landscape connectivity and reducing
fragmentation (thus facilitating species migration under climate change conditions).
Afforestation and reforestation may also contribute to preserving biodiversity hotspots, avoiding soil
degradation and protecting other natural resources (e.g. water) (The European Climate Adaptation
Platform Climate-ADAPT, 2023
The government has implemented numerous policies to promote the manufacturing and use of
renewable energy and shift away from coal, but much still needs to be done to reach India?s 2070
net zero goal.
Reducing GHG emissions will almost certainly hurt growth in the short run and have important
distributional consequences for individuals and communities who today rely on coal.
But with the right policies, these costs?which are non-negligible but dwarfed by the cost of climate
change over the next decade if no action is taken?can be significantly curtailed (IMF, Working Paper
2023).
India is a fossil fuel-dominated economy, with primary energy consumption of 880 million tonnes of
oil equivalent (Mtoe). The electricity, industry, and transport industries account for more than 70
percent of the primary energy demand and 85 percent of the energy-related Greenhouse Gas
(GHG) emissions.
So, minimizing fossil fuel use and increasing renewable energy consumption
India has committed to net-zero by 2070, with a target to reduce the emission intensity of its GDP
and meet 50 percent of its power generation capacity based on non-fossil fuel sources by 2030
(FICCI, 2023).
Green buildings, infrastructure development and improvements in transportation
Land-use changes, crop diversification and livestock management
Promoting environmentally-friendly consumption and nature-based solutions
Ecosystem restoration, circular solutions and enhanced carbon sink
Climate Change Adaptation
Article 7 of the Paris Agreement established the global goal of adaptation of ?enhancing adaptive
capacity, strengthening resilience and reducing vulnerability to climate change, to contribute to
sustainable development and ensure an adequate response in the context of the temperature goal?
of ? holding the increase in the global average temperature to well below 2°C above pre-industrial
levels and pursuing efforts to limit the temperature increase to 1.5°C above pre-industrial levels?
(Adaptation Committee, 2021)
Adaptation is often seen as having five general stages: (a) awareness, (b) assessment, (c)
planning, (d) implementation and (e) monitoring and evaluation.
Government, non-government, and private-sector actors have adopted a wide variety of specific
approaches to adaptation that, to varying degrees, conform to these five general stages.
The WGII AR6 emphasises the assessment of observed adaptation-related responses to climate
change, governance and decision-making in adaptation and the role of adaptation in reducing key
risks and global scale reasons for concern, as well as limits to such adaptation (IPCC, 2022).
Since 2017, UNDP has been engaged with 37 countries in multi-year projects across Asia, Africa,
Latin America and Central Europe on advancing National Adaptation Plans (NAPs) with funding
from the Green Climate Fund (GCF) Readiness Programme.
Adaptation planning and policy support under these programmes are integrally aligned to UNDP?s
Climate Promise and support to NDC enhancement and implementation.
Global Goal for Nature: Nature Positive by 2030
The momentum behind the ?Nature-Positive? concept has been growing since its inception with
more and more businesses, civil society organization, finance organizations referencing it.
There is strong interest from some governments too. The UN biodiversity meeting COP15 is being
held from 11 to 24 October 2021, in Kunming, Yunnan Province, China.
This year?s goal is to adopt a post-2020 global biodiversity framework, as a crucial stepping stone
towards the 2050 vision of ?living in harmony with nature?.
The CBD parties and a range of stakeholders have agreed to adopt processes to promote
international cooperation in the face of growing environmental, health and development challenges.
They are discussing two key texts: The fifth Global Biodiversity Outlook and the zero draft of the
post-2020 global biodiversity framework.
At COP15, they will call for an integrated approach to ensure that action is taken to reverse
biodiversity loss and its impact on ecosystems, species and people.
The supporter organizations of the Global Goal for Nature hope that governments will negotiate
using an ambitious 2030 lense (biodiversity, conservation, News, sustainable development, 2021).
Race to Zero
Race To Zero is a global campaign to rally leadership and support from businesses, cities, regions,
investors for a healthy, resilient, zero carbon recovery that prevents future threats, creates decent
jobs, and unlocks inclusive, sustainable growth.
It mobilizes a coalition of leading net-zero initiatives, representing 11,309 non-State actors
including 8,307 companies, 595 financial institutions, 1,136 cities, 52 states and regions, 1,125
educational institutions and 65 healthcare institutions (as of September 2022).
These ?real economy? actors join the largest-ever alliance committed to achieving net zero carbon
emissions by 2050 at the latest.
Led by the High-Level Champions, Race to Zero mobilizes actors outside of national governments to
join the Climate Ambition Alliance, which was launched at the UNSG?s Climate Action Summit 2019
by the President of Chile, Sebastián Pinera.
The objective is to build momentum around the shift to a decarbonized economy, where
governments must strengthen their contributions to the Paris Agreement.
This will send governments a resounding signal that business, cities, regions and investors are
united in meeting the Paris goals and creating a more inclusive and resilient economy (UN, Climate
Change, [Link]).
The programmes are delivered in close cooperation with UNDP?s global, regional and country
initiatives on climate, disaster risk reduction and SDG relevant portfolios. The current GCF-funded
NAPs portfolio currently has 23 active projects under implementation and 14 projects that have
successfully completed (UNDP, 2024)
Ecosystem-based adaptation is a strategy for adapting to climate change that harnesses
nature-based solutions and ecosystem services.
Restoring and protecting nature is one of the greatest strategies for tackling climate change, but not
just for the obvious reason that it sucks carbon out the air. Forests, wetlands, and other ecosystems
act as buffers against extreme weather, protecting houses, crops, water supplies and vital
infrastructure (UEP, 2024).
A successful net-zero transition needs to combine an increase in the scale and speed of policy
action with a focus on resilience.
Governments can do more to get the policy basics right in the near-term, including the mix of
price-based and other instruments and reform of fossil fuel subsidies.
A resilience lens requires an awareness of potential bottlenecks that could slow down or derail the
transition, and the development of strategies to anticipate and overcome such challenges (OECD
2024).
The vulnerability assessment and adaptation studies of climate change were made in various areas
such as water resources, agriculture, forests, natural eco-systems, coastal zones, health energy and
infrastructure as a part of the ?Initial National Communication of India2? to the United Nations
Framework Convention on Climate Change (UNFCCC).
The emissions limitation is a justice problem requiring distribution of rights to emit, i.e. to use the
atmosphere, to different nations
Adaptation to impacts and compensation to affected parties is another dimension of justice problem
Intra and Inter-Generational Equity and Climate Change Issues
Equity in Climate Change Negotiations
Equity ?different perspectives depending on the discipline, religious and cultural aspects
200 countries that come forward for climate negotiations do not settle down on ?equity? aspect
UNFCCC ties equity to ?common but differentiated responsibilities and respective capabilities?
How to share the burden and opportunities to limit the carbon emission
Equity in Climate Change Negotiations
Some countries emphasise on ?historical responsibilities? of especially those countries that
historically emitted carbon
Some other emphasise on ?capabilities of countries? in terms of financial and technological
capabilities to limit carbon emission
Several options for ?differentiation? ?historical responsibility, capability (levels of econ.
Development), needs and vulnerability.
Equity in Climate Change Negotiations
Article 3 of UNFCCC (1992) distinguishes developed countries from developing countries
-developed countries need to take the ?lead? to combat climate change
Kyoto Protocol (1997) ?set the targets and timetable for developed countries and not for developing
countries ?developed countries to provide funding and technology to developing countries to reduce
their own emission as well as to adapt to CC
Developed Countries -whether the major emitters, if they are there in Annex-1 (43 countries) or not,
are required to reduce emissions?
Equity in Climate Change Negotiations
Because developing countries produced one-third of annual emissions in 1990 and it has increased
to 55 per cent now; by 2030, it may go up to 70 per cent
Developing countries- developed countries are historically responsible for emission (i.e. between
185 and 2000, 75 emissions came from developed countries) and therefore, they should take the
lead ?as their financial and technological options are much better
The ?least developed countries? (48) and Alliance of Small Island States (39)?less polluting and
lack adaptability ?insist on quick resolve to CC ? because they are affected by sea-level rise and
lack of food production
US$ 100 billion from developed countries to developing countries towards ?loss and damage?.
Issues?