Climate change is a phenomenon which is often related to natural disasters such as heat wave, floods and cyclones. However, other than these disasters, climate change is bound to have many other effects as well. These effects might lead to a crisis which will have many more ill consequences in the long run.
Occurrences due to Changing Climate
Over the past few years various natural changes that have been witnessed due to climate change are:
- Rising sea levels,
- Changing weather patterns,
- Rising temperatures across the globe, and
- Decreasing water resources
Impact of Climate Change
- Changes in urban and rural landscapes in the long term are expected due to rising sea levels, changing weather patterns and decreasing water resources.
- The World Bank has predicted an impact on multiple sectors of the economy such as food, energy and water due to rising temperatures.
- Extreme heat due to changing temperatures and changing rainfall pattern has been witnessed in India over the years. The agricultural sector is expected to suffer a lot due to these issues.
- Sea level rise is also expected to impact coastal ecosystems and degrade the quality of groundwater.
Climate change is not only going to impact the environment or the society but will have a deep impact on the economy also.
- Even if rise in temperature is controlled within the target of 2°C, still India will have to import double the food grains as it used to do in the times when no climate change and its impact was visible.
- The problem of climate change has an impact on the GDP also. It would cost the world 1-2 per cent of the global GDP a year to reduce greenhouse emissions. Further if this problem is totally ignored, it would cost 5-20 per cent of the global GDP.
Strategy for Climate Change
For tackling climate change in the long run, there is a need to reduce the greenhouse gas emissions from various sectors of the economy in a comprehensive manner and move to a low-carbon economy.
- Innovative financing opportunities and strategies should be adopted by existing and new businesses. Achieving the targets under India’s Nationally Determined Contributions (NDCs) will need new kinds of financial innovations to mobilise trillions of funds meet those targets.
- Green Bonds are the latest form of investment innovation for funding climate mitigation strategies. YES Bank issued India’s first green infrastructure bonds.
- Financial instruments such as Blue Bonds have been conceptualised for water, agriculture and related infrastructure. These financial instruments need to be given a push through adequate mechanisms such as credit guarantees. This will make them customer friendly and also assist in reaching huge numbers.
- Blending of resources can also help in creating a requisite impact and scale essential for combating climate change. This can be done through public private partnerships.
- Traditional irrigation methods and instruments, like bawdis and tankas used for water conservation have to be used along with modern irrigation techniques like drip and sprinklers that use less water for irrigation.
India has set steep target of achieving a renewable energy installed capacity of 175 GW by 2022. India’s energy goals have received a lot of support from developers and financiers. Various initiatives undertaken in India are:
- Partial Risk Guarantee Fund for Energy Efficiency and Partial Risk Sharing Facility which aims to boost support for promotion of this concept in the industry through the Energy Services Companies model.
- India’s target of carbon sink under the INDCs will be supported by National Green Highways Mission under which the corporates are encouraged to adopt highways and work towards their greenery.
- Other than the Green Bonds, YES Bank also became the first private institution to commit CSR funds towards creation of carbon sink.
Schemes and targets like these give the private and public sector major opportunity to collaborate and finance climate mitigation.