As climate compensation and financing took centre stage at the COP27 summit, India highlighted the need for developed countries to contribute their fair share for covering climate action finances. An official said that India emphasised developing countries require a "substantive enhancement" in climate finance from rich countries by 2024.

"The previously-set goal of USD 100 billion per year by 2020 was minuscule, given the scale of their needs," the official was quoted by PTI as saying on Thursday.

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At COP15 in Copenhagen in 2009, developed countries had jointly promised to contribute $100 billion per year by 2020. The move was aimed at "addressing the needs of the developing countries" and helping them tackle the challenges posed by climate change.

However, the world seems far from its goal as rich countries have "failed" to deliver this finance. Therefore, at COP21 in Paris, it was decided to extend the $100 billion per year goal to 2025.

India and other developing countries demanded rich countries to agree to the New Collective Quantified Goal on Climate Finance (NCQG) — which, they say, should be in trillions as the costs of addressing and adapting to climate change have grown.

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What India argued at COP27

India highlighted that climate actions to meet the Nationally Determined Contributions (NDC) targets require financial, technological, and capacity-building support from developed countries, PTI cited sources as saying.

This happened at a high-level ministerial dialogue on NCQG at COP27 on Wednesday.

The country also cited the work of the Intergovernmental Panel on Climate Change (IPCC) and said rich countries are the major contributors to carbon emissions in the atmosphere.

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"The ambitious goal set by the developing countries requires substantive enhancement in climate finance from the floor of $100 billion per year. The mobilisation of the resources needs to be led by the developed countries and should be long-term, concessional, and climate-specific with equitable allocation between adaptation and mitigation projects," India said.

"The commitment of $100 billion made in 2009 by developed countries was not only minuscule given the scale of needs, but has also not been achieved yet," it said.

'Access to finance at the market rate.'

India mentioned that access to finance at the market rate for climate action would cause considerable stress on the finances of developing countries.

"If ambitious climate targets have to be achieved, these need to be backed by intentions reflected by ambitious, appropriate, and reasonable access to financial resources by developing countries," India said.

"The NCQG needs to deliver on each of these grounds and, thereby, enable effective action by developing countries," it said.

'Technical expert dialogues'

India stressed that it is essential that technical expert dialogues concentrate on the quantum and quality of resource mobilisation. It said discussions within the technical expert dialogues in 2023 should focus mainly on the quantum, recognising the urgency of such meetings for developing countries.

It added that a discussion on quality and other elements, such as access and transparency, is critical. "A structure must be put in place moving forward to ensure decisions on all these elements can be taken by 2024," it said.

"While the private sector may play a complementary role, the commitment is on the developed countries to lead in mobilisation from various sources. The extent of the developed countries' public resources will play a critical role in determining the climate flows. So, it is discouraging to see the focus on private finance alone," it said.

However, at COP 27, "Private finance was highlighted as essential to deliver trillions of dollars needed to limit global warming to 1.5 degrees".

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Drama at COP27

The developed and developing countries reportedly locked horns over finance issues. Who should pay for mitigation and adaptation - the question remained the bone of contention between the two groups.

Island-nation of Antigua and Barbuda said China and India, being major emitters, must also pay for losses suffered by smaller nations due to climate disasters.

"They are major polluters, and the polluter must pay. I don't think there is any free pass for any country, and I don't say this with any acrimony," Prime Minister Gaston Browne of Antigua and Barbuda was quoted by Reuters as saying.

Responding to this, both countries said they were willing to help, but the onus is still on the developed world, the Indian Express reported.

Amid the row, developed countries will likely push developing nations to intensify their climate plans further. Meanwhile, developing countries are expected to seek commitment from rich countries to provide the finance and technology needed to address climate change and resulting disasters.

How much rich countries mobilised

Developed countries mobilised USD 52.5 billion in 2013, as per the data from the Organisation for Economic Co-operation and Development (OECD). After dropping to $44.6 billion in 2015, the finance flow has steadily increased.

In 2020, the developed countries raised $83.3 billion, a jump from $80.4 billion in 2019, PTI quoted from the fact sheet published by the Centre for Science and Environment.

Meanwhile, "India's climate actions have so far been largely financed from domestic sources, including government budgetary support as well as a mix of market mechanisms, fiscal instruments and policy interventions," the Ministry of Environment, Forest and Climate Change had said earlier.

How much is required by developing countries

The Standing Committee on Finance estimated that resources in the range of $6 trillion to $11 trillion are required till 2030 to meet the targets set by developing countries in their NDCs and other communications, including the Needs Determination Reports.

How does our Standing Committee on Finance support the pledge to mobilise $100 billion per year for climate action in developing countries?

Watch the video below