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FICCI Side Event on Climate Finance at the India Pavilion, COP 22

16 November 2016:Session 3

FICCI organized a Side Event on “Climate Finance – Present Landscape & Opportunities” at the COP 22 India Pavilion. The side event highlighted the role of India’s financial institutions (FIs) towards meeting the climate change and sustainability agenda; building preparedness of domestic financial institutions; and the role of International Climate Finance in addressing India’s Climate Change Agenda.

Shri Anil Kumar Jha, Secretary, Minister of Environment, Forest & Climate Change, recognized that in order to bring about the large scale transformation to low-emissions growth, there is a need to build capacities of stakeholders (financiers, project developers, grassroots implementers) and on greater convergence and knowledge sharing amongst stakeholders. He pointed out that public spending on climate-related initiatives in huge, for example, the Central Government disburses close to 5 billion USD to state government for afforestation activities. He also highlighted the need to identify ways in which financing flows are channeled to less developed areas in comparison to those which are already flourishing.

Risk mitigation: Banks in India are not only investing in energy efficiency, renewable energy but also accounting for ESG principles while disbursing loans. Risk mitigation was highlighted as one of the key driver for movement of low-cost, long-term capital into climate mitigation and adaptation projects. Considering that of the total 65 million of projected green jobs, renewables are estimated account for only 10% of the share, it is important to extend climate finance beyond renewable energy to a wider gamut of projects, for example, in green construction, transportation, wastewater management, etc.

Finance for MSMEs: The ring finance agenda needs to be directed towards small and medium scale enterprises in India which contribute a major share of the economy.

Unlocking private capital: Unlocking private capital holds the key for channeling finance to climate mitigation and adaptation fund. Public money from the developed countries must be sutilized to build capacities for bigger investments. Countries need to come together to design COP 23 as the “COP of Capital (markets)”.

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