Budget 2020 | To fight climate change, correct anomalies in fund allocation

India, like the rest of the world, is facing an unprecedented economic and humanitarian crisis caused by climate change and environmental degradation, as is evident from the increasing intensity and recurrence of floods, droughts, extreme heat and cold, cyclones, sea level rise and an erratic monsoon.
According to a recent report by McKinsey Global Institute, climate change hazards such as extreme heat waves and humid conditions could potentially cause a reduction in India’s Gross Domestic Product (GDP) by 2.5-4.5 per cent due to decline in labour productivity and reduced working hours.
The Global Climate Risk Index 2020 says India suffered an economic loss of $37 billion due to climate change in 2018. Another study by Stanford University’s Earth System Science, measuring the effects of anthropogenic climate change on GDP per capita by country, has estimated that global warming has made the Indian economy 31 per cent smaller than it would have been otherwise.
Preliminary estimates by the Government of India indicate that around $206 billion (at 2014-15 prices) would be required between 2015 and 2030 for implementing adaption actions in key areas such as agriculture, forestry, fisheries, infrastructure, water resources and ecosystems. Beyond these, additional investments will be needed for strengthening resilience and disaster management, pegging the total funds requirement at $2.5 trillion for the 15 years.
Unfortunately, consecutive Union Budgets since 2015, under the Narendra Modi-led National Democratic Alliance (NDA) government, have failed to consider the real cost of climate change and environmental degradation. The 2019-20 Budget by Union Finance Minister Nirmala Sitharaman was hailed by the Prime Minister as a “green Budget” with a vision for “pollution free India with green Mother earth and blue skies”, but the actual budgetary allocations did not match this rhetoric, with little or no reference to climate change, mitigation, adaptation or disaster risk reduction.
As she prepares the Budget for 2020-21, Sitharaman must acknowledge the undeniable fact that anthropogenic activity is eroding human capital (education and productivity) as well as produced (infrastructure and property) and natural (air and water) capital at an unprecedented pace.
In this context, Sitharaman must prioritise and scale up fiscal action to address the unfolding climate crisis and environmental emergency by first and foremost bolstering allocations to the National Action Plan on Climate Change (NAPCC).
The NAPCC was adopted in 2008 and incorporates India’s vision for ecologically sustainable development by creating eight national missions, i.e. for deploying solar energy, enhancing energy efficiency, creation of sustainable urban habitat, conserving water, sustaining fragile Himalayan ecosystems, expanding forest cover, making agriculture sustainable and creating a strategic knowledge platform to serve all the national missions. The success of these missions is key to India’s commitment to the Paris Agreement to combat climate change and achieve its Sustainable Development Goals (SDGs).
Another area that the minister needs to urgently look at is ways to mobilise funding for natural calamities and climate-induced disasters. Collections from the National Calamity Contingent Duty -- a major contributor to the National Disaster Relief Fund (NDRF) -- have been declining, having fallen to Rs 3,660 crore in FY18, from Rs 6,450 crore in FY17.
A panel of state finance ministers is exploring whether a disaster cess/tax should be imposed nationwide to fund the NDRF, but it is well known that a cess may not be the best way for funding disaster management. According to an Indiaspend report, just 29 per cent of the clean energy cess on coal was transferred to the National Clean Energy and Environment Fund between 2010-11 and 2016. Instead, Sitharaman must find ways of provisioning for these funds in the Budget.
Finally, the finance minister must also correct the anomaly in allocation to the National Adaptation Fund. One of India’s nationally determined contributions (NDCs) under the Paris Agreement is “to better adapt to climate change by enhancing investments in development programmes in sectors vulnerable to climate change, particularly agriculture, water resources, the Himalayan region, coastal regions, health, and disaster management”.
The allocation of Rs 100 crore, a fraction of the total budget of over Rs 2,900 crore allotted to the Ministry of Environment, Forest and Climate Change (MOEFCC) in 2019-20 is woefully inadequate. Mitigation of climate change depends on the international policy, but at a national level, it is critical that we invest in adaptation to prepare our most vulnerable communities to survive and thrive.
Shailendra Yashwant is senior adviser, Climate Action Network South Asia (CANSA). Twitter: @shaibaba. Views are personal.

First published in MoneyControl

Climate Change | 2020 is the year of climate emergency

Children at Thousand Islands of Indonesia, that are disappearing due to sea level rise.

Fear, not hope, reigned in Australia on New Year’s Day. A string of fires all the way down the South Coast region of New South Wales and Victoria are burning at emergency levels . This year’s bushfire season is widely regarded as one of the most severe on record. Since September, fires have spread across much of south-eastern Australia following a period of extreme drought and record-breaking temperatures.
At least 25 people killed and ecologists at the University of Sydney estimate more than one billion birds, reptiles and mammals in New South Wales alone are likely to have died in the rapidly spreading wildfires. Reuters reported that by January 7, the fire had expanded to 10 million hectares or “an area the size of South Korea”.
The direct cost of the fires to the Australian economy has been estimated to be at least $2 billion and rising. With summer only one-third over, the situation is likely to grow even grimmer in Australia.
Meanwhile, in Indonesia, torrential rains, which began on New Year’s Eve, set off deadly flash floods in the capital Jakarta and elsewhere on the island of Java, killing at least 66 people and sending over 173,000 residents to temporary shelters.
Jakarta is a sinking city built on swamps, riddled with punctured aquifers, clogged waterways, and weighed down by an unwieldy population that is regularly inundated by floods as sea levels rise steadily. This is why Indonesian officials are already seeking to relocate the country’s capital to East Kalimantan Province, on the island of Borneo.
However, the deluge in the first week of 2020 was the heaviest in the capital since record-keeping began in the 19th century. “This rain is not ordinary rain,” warned a statement from Indonesia’s Meteorology, Climatology and Geophysics Agency.
As always multiple factors are at play in this annual cycle of fires and floods on the Australian continent and the Indonesian archipelago, but the scale and intensity of this year’s unfolding disasters unequivocally reiterate that the link between the current extremes and anthropogenic climate change is scientifically undisputable.
If Indonesia is naturally prone to floods, Australia is naturally primed to burn. Every year there is a fire season in the summer, with hot, dry weather making it easy for blazes to start and spread.
More than a decade ago, the Intergovernmental Panel on Climate Change (IPCC) concluded that ongoing anthropogenic climate change was virtually certain to increase in intensity and frequency of fires in Australia and flooding in Indonesia. This assessment of the science evidence has been repeated in countless reports, including the IPCC’s Climate Change and Land report, released in August.
Yet neither the Australian nor Indonesian governments have announced any significant changes to their climate policies. Australia produces iron ore and a third of global coal exports and the Indonesian economy is fuelled by export of palm oil and coal. Both countries are also among the top 20 CO2 emitters.
Australian Prime Minister Scott Morrison openly promotes coal industry, which is allegedly a major funder to his party. “I am not going to write off the jobs of thousands of Australians by walking away from traditional industries,” he told Australian broadcaster Channel Seven.
Indonesian President Joko Widodo has pledged to rein in the illegal expansion of palm oil sector, the largest driver of deforestation, but at the same time in a bid to bring “development” to remote regions, he is accused of surreptitiously allowing vast tracts of peat land forests to be cleared for palm oil in the Indonesian part of Papua New Guinea.
Australian fires and Indonesian floods are merely a glimpse of a world careening irreversibly into a climate emergency that appears to be set to unfold across the planet in 2020.
As Cate Blanchett put it so succinctly at the 77th Golden Globe Awards night, “…when one country faces a climate disaster, we all face a climate disaster, so we are in it together.”
The question is if Morrison and Widodo are willing to accept that climate change is aggravating natural disasters in their own countries, that they urgently need an alternative business model to shore up their GDPs, that bold and decisive action to end coal extraction and deforestation once and for all will go a long way in helping the world survive the ongoing climate crisis.
Shailendra Yashwant is senior adviser, Climate Action Network South Asia (CANSA). Twitter: @shaibaba. Views are personal.

First published in Moneycontrol