Vineet Mittal, Chairman, Avaada Group, 0
It is undeniable that the effects of climate change are becoming more and more evident across the planet every year, and India- the most populous nation on earth, is also not immune to these effects. In the upcoming times, Indians will have to deal with several consequences, including unpredictable monsoons, frequent droughts, flooding, and extremely high temperatures.
What is worth taking into consideration is that the concern just doesn’t end here. According to Economic Times, global warming will also pose a serious threat to infrastructure and housing with a loss of $38 trillion each year by 2050. Additionally, climate change and the fight against it could wipe out 9 percent of the value of global housing by 2050—which amounts to $25 trillion. On the other hand, India is making good progress in combating climate change, but more development needs to be done to safeguard the nation from the impending changes. It arises question: who will bear the financial burden of the damage inflicted upon homes and infrastructure?
The Rising Threat to Infrastructure
According to a report by India Today, by 2030, it is predicted that 8 crore jobs worldwide could be lost due to climate change, of which roughly 3.4 crore would be lost in India. Reserve Bank of India's recent report states that, labor hours lost due to intense heat and humidity could put as much as 4.5 percent of India's GDP at risk by 2030. Rising ocean temperatures are making hurricanes, typhoons, and cyclones stronger, which is causing extensive damage to house and other infrastructure.
According to a report published by the CDRI, a think tank based in New Delhi, the infrastructure sector has suffered annual losses of approximately $850 billion due to climate change. This suggests that roughly 14 percent of the projected GDP growth in 2021–2022 is in jeopardy. According to the report, important sectors like power, transportation, and telecommunications account for about 80 percent of this risk. Furthermore, coastal areas and island nations are especially vulnerable to the threat of flooding and displacement brought on by sea level rise, making these communities a major target of rising sea levels and infrastructural loss.
Dauting Cost: Climate Change's Impact on Infrastructure
According to IMF research, some countries are already facing high costs, which are expected to increase to approximately 0.25 percent of global GDP per year in the future. Still, this number understates the magnitude of the difficulties that less developed countries face. Annual needs are projected to exceed one percent of GDP in about 50 developing economies over the next ten years and it can rise up to 20 percent of GDP for small island nations exposed to sea level rise and tropical cyclones.
COP28’s Loss and Damage Fund: A Lifeline for Vulnerable Nations
Given these difficulties, it is crucial to determine who should pay for any damage to infrastructure caused by climate change. Should governments give impacted communities financial support? Should losses brought on by climate change be required to be covered by insurance companies? Alternatively, should there be a
worldwide system in place to distribute funds for efforts to mitigate and adapt to climate change?
Finally, after years of struggle, a glimmer of hope emerged at the recent COP28 climate conference with the establishment of a dedicated Loss and Damage Fund. The decision was adopted by consensus by all Parties including India. The Fund's goal is to support developing nations that are especially susceptible to the negative effects of climate change in their efforts to mitigate economic and non-economic losses and damages brought on by these effects, such as slow-onset and extreme weather events. Almost $ 700 million has been pledged by nations in a generous outpouring of support following the decision's adoption. With a pledge of $ 100 million to the loss and damage fund, the United Arab Emirates (UAE) is leading the effort. Prominent contributions do the same: the UK pledges GBP 40 million for the Fund and an additional GBP 20 million for other funding arrangements; Japan contributes $ 10 million; the US pledges $ 17.5 million; and the EU, which includes Germany, pledges 225 million euros. Key aspects are:
• Host entity: Countries agreed to locate the fund in the World Bank for at least four years while establishing it as an independent entity under the UNFCCC’s financial mechanism.
• Board composition: The fund will have a 26-person board, with most members from developing countries, and will be responsible for creating a system for allocating resources, among other tasks.
• Initial pledges: Several pledges for the LDF and other funding arrangements were made during the first day, including from the United Arab Emirates and several EU member states
• Fund capitalization: Concerns remain about the fund’s capitalization and the voluntary nature of support for addressing loss and damage.
• Advocacy for Policies: The fund will also push for laws that uphold climate justice and deal with the underlying causes of climate change.
This Fight Isn't Over: Here’s What You Can Do
While the Loss and Damage Fund is an important first step, it is not the end point. Aggressive global action is still required to reduce emissions and stop global warming. Here's how you can contribute to the resolution:
• Reduce Your Carbon Footprint: Small changes in your daily life add up – walk, bike, conserve energy, and choose energy-efficient appliances.
• Spread Awareness: Educate yourself and others about the urgency of the climate crisis and its importance for humanity. Education is the key.
• Demand Climate Action: As a responsible citizen, one must hold their elected officials accountable for upholding their climate commitments.
Conclusion
Extreme climate change is a major global threat to residential areas and architecture, costing billions of dollars in damages annually. The creation of the Loss and Damage Fund is a major turning point that will give vulnerable communities facing the effects of climate change much-needed financial support. To guarantee the fund's success, the international community, governments, and insurers must work together to address the financial ramifications of climate-related damage.
Our whole culture, identity and way of life is linked to the environment and natural resources. The future of our planet is at stake. By working together, we can ensure climate chaos doesn't bankrupt developing nations and leave them struggling to rebuild in the wake of disaster. Let's make sure that we unite in this fight to save our planet.
Finally, after years of struggle, a glimmer of hope emerged at the recent COP28 climate conference with the establishment of a dedicated Loss and Damage Fund. The decision was adopted by consensus by all Parties including India. The Fund's goal is to support developing nations that are especially susceptible to the negative effects of climate change in their efforts to mitigate economic and non-economic losses and damages brought on by these effects, such as slow-onset and extreme weather events. Almost $ 700 million has been pledged by nations in a generous outpouring of support following the decision's adoption. With a pledge of $ 100 million to the loss and damage fund, the United Arab Emirates (UAE) is leading the effort. Prominent contributions do the same: the UK pledges GBP 40 million for the Fund and an additional GBP 20 million for other funding arrangements; Japan contributes $ 10 million; the US pledges $ 17.5 million; and the EU, which includes Germany, pledges 225 million euros. Key aspects are:
• Host entity: Countries agreed to locate the fund in the World Bank for at least four years while establishing it as an independent entity under the UNFCCC’s financial mechanism.
• Board composition: The fund will have a 26-person board, with most members from developing countries, and will be responsible for creating a system for allocating resources, among other tasks.
• Initial pledges: Several pledges for the LDF and other funding arrangements were made during the first day, including from the United Arab Emirates and several EU member states
• Fund capitalization: Concerns remain about the fund’s capitalization and the voluntary nature of support for addressing loss and damage.
• Advocacy for Policies: The fund will also push for laws that uphold climate justice and deal with the underlying causes of climate change.
Our whole culture, identity and way of life is linked to the environment and natural resources
This Fight Isn't Over: Here’s What You Can Do
While the Loss and Damage Fund is an important first step, it is not the end point. Aggressive global action is still required to reduce emissions and stop global warming. Here's how you can contribute to the resolution:
• Reduce Your Carbon Footprint: Small changes in your daily life add up – walk, bike, conserve energy, and choose energy-efficient appliances.
• Spread Awareness: Educate yourself and others about the urgency of the climate crisis and its importance for humanity. Education is the key.
• Demand Climate Action: As a responsible citizen, one must hold their elected officials accountable for upholding their climate commitments.
Conclusion
Extreme climate change is a major global threat to residential areas and architecture, costing billions of dollars in damages annually. The creation of the Loss and Damage Fund is a major turning point that will give vulnerable communities facing the effects of climate change much-needed financial support. To guarantee the fund's success, the international community, governments, and insurers must work together to address the financial ramifications of climate-related damage.
Our whole culture, identity and way of life is linked to the environment and natural resources. The future of our planet is at stake. By working together, we can ensure climate chaos doesn't bankrupt developing nations and leave them struggling to rebuild in the wake of disaster. Let's make sure that we unite in this fight to save our planet.