Prime Minister of India and other dignitaries are having a conference on climate change, a broadly classified subject which has ushered in sudden cloud burst in Himalayas in India, regular fire in Hollywood and other places with million dollars houses or knee- deep water in Belgium, and other places around our mother earth at Glasgow, U.K., from Sunday 31, 2021 onwards till November 12, 2021. Let us learn about the above conference, one of the last-ditch battles to save the world economy and its surroundings. Though the VIPs would leave after 3 days deliberations, the conference completes its course after 12 days only with others actively participating. (Obviously, extensive quoting from UN website has helped me to put together this article. Reference given at end)

U.N COP 26 Goals – Finance and others

What is COP 26 and why does it get unusual prominence even among active pandemic in the world?

The 2021 United Nations Climate Change Conference, also known as COP26, is the 26th United Nations Climate Change conference. It is scheduled to be held in Glasgow, Scotland, United Kingdom, between 31 October and 12 November 2021, under the co-presidency of the United Kingdom and Italy.

What are the goals of above conference?

1. Secure global net zero by mid-century and keep 1.5 degrees within reach.

2. Adapt to protect communities and natural habitats.

3. Mobilize finance

4. Work together to deliver

The most complicated agenda put is simple terms invites us to discern the details. Why not?

1. Net zero and others

I often hear the word, net – zero which is quite confusing.

Let the official communication leads us with the following explanations but we will scent it in our own ways.

Countries are being asked to come forward with ambitious 2030 emissions reductions targets that align with reaching net zero by the middle of the century.

To deliver on these stretching targets, countries will need to:

  • accelerate the phase-out of coal
  • curtail deforestation
  • speed up the switch to electric vehicles
  • encourage investment in renewables.

My explanation

Your bewilderment at spate of EV cars and the proposal of leading world car makers to shift from petrol/diesel or fossil- based automobiles to renewable based energy never ceases . Current indications of the leading Indian automobile manufacturer to be undecided about future is an indication of the predicament of the world, caught unaware by the earth’s unexpected behavior during the last two years, totally upsetting the world economy. On all above variables, India has clearly declared its intent to change but does ask others to adopt to new standards and help emerge a new sustainable future.

2. Adopt to protect communities

The climate is already changing, and it will continue to change even as we reduce emissions, with devastating effects.

At COP26 we need to work together to enable and encourage countries affected by climate change to:

  • protect and restore ecosystems
  • build defences, warning systems and resilient infrastructure and agriculture to avoid loss of homes, livelihoods and even lives.”

My explanation

Let us compare the position in India itself. Punjab used to be the number one state in 1960s with the introduction of green revolution and one easily understands the prosperity it brought to its state and others who followed it. An easy introduction.

However, the failure of this leading agriculture state to change from wheat or rice to other money-spinning agriculture products makes one ponder over the failure of us, as Indians. Others like, Tamil Nadu, Maharashtra, or Gujarat have made changes in their agriculture programs and organic items have replaced many of their emphasis on routine produce only. Enough income from this new experimentation has altered the balance for better.

As explained in the beginning, loss all over the world due to nature in economical terms are still being measured.

3. Mobilize finance

4. To deliver on our first two goals, developed countries must make good on their promise to mobilizeat least $100bn in climate finance per year by 2020.

5. International financial institutions must play their part and we need work towards unleashing the trillions in private and public sector finance required to secure global net zero.”

My observation

If the past is an indicator of the devastation of nature by the developed nations which did not have any concern for its preservation, it is essential to fulfil this promise at the earliest. This will propel the underdeveloped/developing nations to have faith in the commitment of the richer nations.

4. Work together to deliver

“We can only rise to the challenges of the climate crisis by working together.

At COP26 we must:

  • finalize the Paris Rulebook (the detailed rules that make the Paris Agreement operational)
  • accelerate action to tackle the climate crisis through collaboration between governments, businesses, and civil society.”

My observation

Nature vastly devastated by inhuman behavior of human beings acted impartially in decimation of assets, reduction of human lives, and exhibition of uncontrollable fury. By this sudden occurrence of inexplicable imbalance in nature’s vast changes the recent conference assumes extraordinary interest among all nations.

It has been reported that India’s request to include the small agriculturist’s issues in the agenda has been accepted which is normally expected in the behavior of rich nations.

Let us go in details on finance.

Expectedly funding gets adequate importance since form of finance will play the required changes in climate.

  • Public finance for development of infrastructure towards a greener future.
  • Private finance with creative best of technology and innovation will convert the billions of public finance to trillions.

An ambitious and realistic vision.

Support for the developing nations is being heard readily and my need USD 100 Billion every year to help the communities towards achieving their goals of climate change.

OECD£££ countries firmly believe that they mobilized US D 79.6 in 2019 while U.K. visualizes an ample measure of climate finance of £ 11.6 billion over the next five years span of 2025/2026.

The president elect for COP 26 Alok Sharma has already requested the officials of Canada and Germany to produce a delivery plan of USD 100 which was informed along with the technical report which was published on 25 October 2021.

What about private finance the catalyst to convert public finance into trillions?

1. All investment and spending decisions of countries and international financial institutions who will roll out stimulus packages to include climate change.

2. Companies will have to be frank about the risks and opportunities that exist while shifting their business towards net zero business.

3. Central banks and regulators to ensure that financial systems do get ready towards net zero, the goal

4. Banks, insurers, investors, and other financial firms will join the efforts to reach net zero goal.

Any serious- minded scholar can refer to OECD website for details.

Conclusion

The worst scenarios with actual happening in the world have converted the efforts of big financial institutions and developed countries towards more seriousness than the passion of a few rich who have been striving hard for climate change.

The climate change as an attitude has caught the imagination, action plans and now in realistic budgets and spending plans of the developed nations who will also ensure the required changes on the part of the developing/under- developed nations who took the convenient path of blame on the other resourceful group.

Yes, the deliberations and conclusions of COP 26 will change the world towards better climate change.

Reference

OECD Website

https://ukcop26.org/cop26-goals/finance/

*****

Disclaimer: The contents of this article are for information purposes only and do not constitute an advice or a legal opinion and are personal views of the author. It is based upon relevant law and/or facts available at that point of time and prepared with due accuracy & reliability. Readers are requested to check and refer relevant provisions of statute, latest judicial pronouncements, circulars, clarifications etc. before acting because of the above write up. The possibility of other views on the subject matter cannot be ruled out. By use of the said information, you agree that Author/TaxGuru is not responsible or liable in any manner for the authenticity, accuracy, completeness, errors, or any kind of omissions in this piece of information for any action taken thereof. This is not any kind of advertisement or solicitation of work by a professional.

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