G7 meeting: Unique opportunity for Indian PM Modi to remind the developed world of climate finance

The invitation to Narendra Modi for G7, where China is not invited, also reaffirms a stark reality that there is no alternative on the horizon to Modi’s bold and decisive role in the global play and India's strategic geopolitical position that hedges against China’s hegemony, writes  Rajendra Shende for South Asia Monitor

Rajendra Shende Jun 05, 2021
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G7 meeting

Race To Zero is now a flagship movement in all global climate meetings and will remain so for years to come. It denotes achieving a net-zero emission of carbon dioxide gas.  However, the race to achieve zero subsidies for fossil fuels (oil, gas and coal) is a more seminal act to fight climate change that must not be forgotten. In the forthcoming G7 (UK, US, Canada, France, Germany, Italy, Japan along with EU) meeting to be held in the UK on 11-13 June, India, though not part of the G7, is invited and Prime Minister Narendra Modi has accepted the invitation. He now has an opportunity to set the movement in the right direction.

Modi’s image appears to be tarnished, mainly in the western media, which has found governance gaps in his management of the second wave of the Covid 19 pandemic. On the other hand, the world’s seven rich countries have recognized India’s emerging strategic role in economic, social and environmental global recovery post-covid. 

The invitation to Narendra Modi for G7, where China is not invited, also reaffirms a stark reality that there is no alternative on the horizon to Modi’s bold and decisive role in the global play and India's strategic geopolitical position that hedges against China’s hegemony. 

The next pandemic-tsunami is widely recognized to be the climate crisis. G7 is determined to address it in an intrepid way and through unflinching approaches. Prime Minister Modi already set a pivotal tone towards that approach when he addressed US President Joe Biden’s Climate Summit held in April. President Biden and PM Modi launched the India-US clean energy agenda to mobilize global investment, demonstrate clean technologies and enable green collaboration. It was Joe Biden's first-ever global collaboration after he became US President. It was also the first-ever climate alliance between the world’s oldest democracy and the globe's largest democracy that recognizes, almost forgotten, the role of ‘climate finance’ to achieve the climate goals of the Paris Climate Agreement.

Race-To-Zero  

Race-To-Zero is a buzzing and bubbling global campaign to rally global leadership and youth to achieve the goals of the Paris Climate Agreement. It is emerging as ‘trending ‘ and even ‘exploding phrase’ on social media, effectively competing with pandemic-phrases like vaccine-shortages, ICU-Beds, third-wave, herd-immunity and so on.  The phrase Race To Zero is being widely traded among the climate change community starting from the United Nations Secretary-General António Guterres to corporate CEOs to young climate activists. Leading up to the 26th Conference of Parties, called ‘COP26,’ to be held in Glasgow, UK, in November 2021, the campaign has caught the attention of many climate front-liners drenched in uncertain Covid-waves that are striking humanity most severely.

The story of Race-to-Zero is relatively recent. The analysis carried out by the United Nations Environment Programme (UNEP) in its ‘emission gap’ reports reveal that voluntary actions for Greenhouse Gas (GHG) emission reductions submitted by nearly all -192- countries (also called Nationally Determined Contributions - NDCs) under the 2015 Paris Climate Agreement, were totally inadequate to reach the goals of the agreement. The need for more ambitious NDCs has become obvious and urgent.

During COP25, which was to be held in 2019, in Santiago, Chile (the venue was changed almost at the last moment to Madrid, Spain, due to nation-wide agitation in Chile, paradoxically, because the government decided to raise transportation fare) a courageous Climate Ambition Alliance was launched in Madrid for enhancing the emission reduction targets for meeting the goal of the Paris Agreement to limit the rise in global average temperature by end of the 21st century to 1.5 degree Celsius or definitely not more than 2 degrees Celsius above the pre-industrial level.

While the Paris Agreement includes the governments' commitments (NDCs), Climate Ambition Alliance is intended to include commitments of non-state actors like regions, cities and businesses. The global climate conference (COP26) could not be held in 2020 due to an unexpected and unprecedented pandemic and hence got postponed. 

However, in order not to miss the need for an extra boost to the emission reduction targets on World Environment Day (5th June 2020), Chile and the United Kingdom, representing the venues of COP25 and COP26, launched the Race To Zero campaign as part of Climate Ambition Alliance.  It brought together the leadership in businesses, cities, regions and investors for a healthy, resilient and carbon-free recovery that prevents future threats, creates decent jobs, and enables inclusive and sustainable growth.

Carbon neutrality

Nearly all alliance members are committed to the same enhanced goal of achieving carbon neutrality by 2050. Intergovernmental Panel on Climate Change (IPCC) has stated in its recent report that by around 2050 the world has to be carbon neutral to meet the target of limiting the rise of temperature to 1.5 degrees Celsius and by around 2075 to limit the temperature rise to 2 degrees Celsius. China, the largest emitting country in the world, in 2020, has pledged carbon-neutrality by 2060.

Carbon neutrality does not mean achieving zero-emission but achieving 'net zero' emission. Carbon neutrality in simple terms means reaching the balance between the emission of carbon dioxide and absorbing the same from the atmosphere in ‘carbon sinks’ such as forests, oceans and soil. That would provide the much-needed ‘net zero’ addition of carbon or carbon dioxide emissions into the atmosphere.

Interestingly, the Paris Climate Agreement does not mention carbon-neutrality as a target though there is a language in the agreement that encourages countries to enhance the voluntary targets of emission over and above the NDCs submitted by the countries to the secretariat of the United Nations Framework Convention on Climate Change ( UNFCCC). Carbon-neutrality is the ambitious enhancement of the emission reduction targets.

The fifth anniversary of the Paris Agreement in December 2020, was a major milestone in more sense than one. First, 2020 ranks as the second-hottest year on record for the planet, knocking 2019 down to the third hottest. Second, it was in December that scientists recorded that the earth’s average temperature rise was close to 1.2° C, dangerously close to 1.5 degrees Celsius, one of the two stringent targets under the Paris Agreement.

The year 2020 also signaled that from now onwards the world should aim for the target of 2 degrees Celsius, having made a target of 1.5 degrees Celsius near impossible. Third, having observed the continued growth of emissions since the UN Climate Convention was accepted in 1992, the world has realized that now there is no other goal but to achieve carbon neutrality between 2050 and 2075.

As of today, the net zero initiative includes nearly 120 countries, more than 700 cities, 2,000 businesses and 163 of the biggest investors, that are committed to achieving net-zero carbon emissions by 2050 at the latest. Collectively, these actors now cover nearly 25 percent of global CO2 emissions and over 50 percent of the Gross Domestic Product.

Fault lines

When the need for carbon neutrality is hyped through the phrase Race-to-Zero, two historic aspects become evident. First, there are no deliberations on climate justice, climate finance, as well as alternative technologies needed by the developing and least developing countries (LDCs) as a necessary and essential accelerator to achieve carbon neutrality. These are the pillars for the widely accepted principle of common but differentiated responsibilities and respective capabilities in all the multilateral environmental agreements.

The second is to make finance flows consistent with the country’s ambitious reductions in emissions as well as separate financing for climate-resilient development, also known as climate adaptation fund, which is clearly embedded in the Paris Climate Agreement.

Twelve years after the commitment in Copenhagen and five years after the signing of the Paris Agreement, how far have the developed countries and their groupings come on the climate finance agenda? Here we are in 2021 without any signs of raising ambition for Climate Finance. The performance of the ‘Green Climate Fund’, a dedicated fund for global action on climate change, is miserable. It has so far managed cumulatively only about USD 10 billion, ridiculously low, and far from the ambitious targets.

Developing countries have pointed out a total lack of transparency in definition and in calculating ‘Climate Finance’. Developing countries firmly stated that they needed dedicated funds. Official Development Aid (ODA), private sector finance and bilateral aid should not be counted. Developed countries are harping on counting all these flows.

India's role

India has more credibility under Paris Climate Agreement unlike other major developing countries including China. India had played a key role in carving out Paris Climate Agreement in 2015. Further, India is well on track, as confirmed by the UN and other independent agencies, to meet its climate targets as provided in its NDCs. Its joint initiative with France of International Solar Alliance is also considered a game-changer and path-breaking mechanism that would practically add to the ambitious targets. 

More than 20 top Indian private-sector corporations, including Infosys, Reliance and the Tatas have declared that they would go climate neutral. More than 250 higher educational institutes in India have also pledged to go climate neutral under the Not Zero-Net Zero campaign by an NGO - Terre Policy Centre’s project called  Smart Campus Cloud Network.

While these initiatives will be piloting and making youth and business leaders ‘Carbon-neutrality-ready’, such positivism has been leveraged by prime minister Modi to position India in COP26 as the country that would walk the talk.

While carbon neutrality was the pitch during the Climate Summit of April 2021, hosted and chaired by president Biden, the Indian prime minister deployed climate diplomacy not only to remind the developed countries about the accepted principle of common but differentiated responsibilities but also about their past commitments on Climate Finance. 

Jointly with Biden, Modi had declared in that summit, the mechanism and alliance for tracking climate finance that is being provided to the developing countries and thus mainstreams the demand for climate justice, without which our planet would lose the battle to save it.

For world leaders from developed countries, the time has come to reaffirm the prior commitment given to developing countries in COP15 held in Copenhagen in 2009. The most crucial outcome of the  Conference of Parties - COP15 - Copenhagen 'accord' was the promise by the developed countries to fund developing countries’ actions to reduce greenhouse gas emissions and to adapt to the inevitable effects of climate change.

Developed countries promised to provide USD 30 billion for the period 2010-2012 (which meant USD10 billion per year) as additional financing, and to mobilize long-term finance of a further USD 100 billion a year by 2020 from a variety of sources. The words, ‘from a variety of sources’ have now become a sort of escape for the developed countries to wriggle out of funding commitment, at least to a certain extent. The well-negotiated term of ‘additional financing’ seems to be getting weaker to pin down the developed countries. G7 meeting this month is in the best position to implement Race to Zero, not for emission but for subsidies.

Fossil fuel subsidies

Eliminating the fossil fuel subsidies would bring in triple benefits. It would grossly reduce global carbon emission and also health risks from air pollution. The third win is on freeing those funds for Climate Finance for developing countries. Direct global fossil fuel subsidies reached about USD 300 billion (USD 100 billion energy-related subsidies) in 2017, and USD 5.2 trillion when indirect costs such as air pollution are priced in (as per International Monetary Fund estimate). This is more than the total global expenditure on human health. Ending these subsidies to zero can cause a 28 percent reduction in global carbon emissions and a 46 percent reduction in air pollution deaths as per the UN.

‘Polluter to Pay’ is a well-accepted, recognized and well-applied principle in global environmental negotiation. It is based on climate justice. It is the historic responsibility of the developed countries to re-launch in the upcoming G7 meeting Race To Zero for fossil fuel subsidies along with Race To Zero for GHG emissions. Such Race To Zero should be launched in the G7 meeting along with the launch of an enforcement mechanism. If not, then the Glasgow meeting will also go on a slippery slope as it happened in Copenhagen. What would remain is the ‘Glasgow accord’, without a legally binding mechanism.

PM Modi has an opportunity to join hands with UK PM Boris Johnson to strengthen climate finance as pledged in Copenhagen. He could remind G7 that apart from Race TO Zero - now part of UN campaigns - Race To Zero for fossil fuel subsidies and Race to USD 100 billion a year to developing countries should also be flagged off. Then only climate justice would be delivered.

(The writer is Chairman TERRE Policy Centre and former Director UNEP. The views are personal. He can be contacted at www.rajendrashende.com/www.rajendrashende.blog)

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