Context

• All 197 Parties to the UN Framework Convention on Climate Change (UNFCCC) agreed to enable financing for loss and damage to those that need it the most.

What is Loss and damage (L&D) fund?

• Adverse impact of climate change: Loss and damage (L&D) refer to the adverse impacts that vulnerable communities and countries face as a result of a changing climate.
• Making the rich countries pay: Rich countries had resisted L&D payments for years. Under pressure, they could no longer duck their responsibility.

Click and get your FREE Copy of CURRENT AFFAIRS Micro Notes

What has been agreed by all parties under COP 27?

• Formation of Transition committee: The COP27 decision includes the development of a Transition Committee dedicated to L&D, with equal representation from rich and poor countries.
• Operationalizing the funding arrangement: The committee has been tasked with configuring institutional arrangements, identifying and expanding sources of funding, and coordinating with existing funding arrangements — by COP28 in the UAE next year.

What role India can play in facilitating the Loss & Damage?

• Develop a Global Vulnerability Index: Last year, CEEW developed a Climate Vulnerability Index for India. It found that over 80 per cent of Indians are highly vulnerable to extreme climatic disasters. Such data in the public domain helps map critical vulnerabilities and plan strategies to build resilience by climate-proofing communities, economies and infrastructure.
• South-led research consortium: India would do well to convene experts and encourage the development of a South-led research consortium dedicated to scientific exploration of “event attribution” science. This would enrich climate science, draw attention to the more vulnerable regions, build research capacity in developing countries, and strengthen the L&D framework.
• Champion the Early Warning Systems Initiative: The Executive Action Plan for the Early Warnings for All Initiative, unveiled at COP27. It aims to ensure every person on Earth is protected by early warning systems within five years. It has called for targeted investments of $ 3.1 billion during 2023-27, which could avoid annual losses of $3-16 billion against natural hazards in developing countries.
• Leverage the Coalition for Disaster Resilient Infrastructure (CDRI): India founded the CDRI “to promote the resilience of new and existing infrastructure systems to climate and disaster risks in support of sustainable development”. CDRI is currently undertaking a Fiscal Risk Assessment study to support the development of a comprehensive disaster-risk financing strategy in more than 35 countries and multilateral entities.

Other strategies for Loss & Damage funds

• Pressurizing the developing countries: Pressure must also be put on large emerging economies, with rising emissions, to contribute to L&D financing. Limiting L&D compensation depends on increasing adaptation spending.
• Global Resilience Reserve Fund: The global resilience reserve fund is capitalized by IMF Special Drawing Rights, to create an insurance cushion against severe physical and macroeconomic shocks that climate risks would impose.
• Enhanced and accelerated emissions mitigation: While countries around the globe released its long-term low-carbon emissions development strategy last week, it must use scientific methods to quantify its long-term targets, to give direction to industry and investors.

Conclusion

• Loss & Damage financing is just a band-aid. Global emissions must reduce by 50 per cent by 2030 but there is no opprobrium for failing to present credible plans to do so. India drew attention to sustainable lifestyles via its Lifestyle for Environment mission. World must change its attitude towards climate change because it is already too late.

Mains Question

Q. What is Loss and damage fund agreed Under COP 27? What role India can play for global south for facilitating the L&D fund?

(Click) FREE1-to-1 on-call Mentorship by IAS-IPS officers | Discuss doubts, strategy, sources, and more

Get an IAS/IPS ranker as your 1: 1 personal mentor for UPSC 2024

Attend Now