Loss and Damage fund UPSC NOTE

 Why in news

  • At the COP 19 to the UNFCCC in Warsaw, Poland, in 2013, representatives of member countries formally agreed to establish the L&D fund.

  • Adaptation is the proactive response to climate change, the art of survival by which communities and countries make deliberate choices to prepare for and cope with climate-related challenges.

What is the Loss and Damage fund?

  • The call for affluent nations to acknowledge their accountability for historic pollution is more than 30 years old. 

  • Historic pollution has elevated the world’s average surface temperature by more than 1 degree Celsius and is currently inflicting damage worldwide.

  • At the COP 19 to the UNFCCC in Warsaw, Poland, in 2013, representatives of member countries formally agreed to establish the L&D fund

  • It was being created to provide financial and technical assistance to economically developing nations that were incurring L&D due to climate change.

  • At COP 25, the Santiago Network for L&D was set up, but countries didn’t commit any funds

  • Subsequently, at COP 26, the Glasgow Dialogue on finance for L&D was established to continue discussions over the next three years on the fund.

  • Finally, at COP 27 in November 2022, states agreed to set up the L&D fund and a Transitional Committee (TC) to figure out how the new funding mechanisms under the fund would operate. 

  • The TC was also to prepare recommendations that countries would consider, deliberate on, and potentially adopt by COP 28.

What has caused the impasse at the TC meetings?

  • The fourth meeting of the TC, or TC4, concluded on October 20, 2023, with no clear consensus on operationalising the L&D fund

  • The principal bones of contention had to do with hosting the fund at the World Bank.

  • The differences on these counts deepened the rift between developed and developing nations at the TC4 meeting.

  • An impromptu fifth meeting of the TC, that is TC5, in Abu Dhabi concluded a few days back, and a set of recommendations have been drafted and forwarded to COP 28

  • TC5 was not on the original agenda , a sign of how contested the L&D fund continues to be.

  • At the TC5 meeting, developing nations conceded to the fund being hosted by the World Bank Financial Intermediary Fund for an interim period of four years, serviced by a new dedicated and independent secretariat. 

What are the implications of this outcome?

  • The TC5 outcome highlights a profound lack of trust between affluent and emerging economies.

  • Regarding their historical responsibilities, creating a substantial divide between wealthy and impoverished nations, particularly concerning climate reparations.

  • The unwillingness of wealthy nations to fulfil intended commitments undermines faith in global climate negotiations and hampers the cooperative spirit necessary to address climate change. 

  • It represents a missed chance to take concrete steps to combat the escalating consequences of climate change.

  • Vulnerable communities and signifies a breakdown in diplomatic efforts, leading to doubts about nations’ ability to collaborate effectively.

  • Beyond the immediate diplomatic and trust-related repercussions, the watering down of the L&D fund has wide-reaching implications. 

  • It threatens climate justice and exacerbates the suffering of vulnerable communities in developing nations. 

  • These communities have contributed minimally to global emissions but today bear the brunt of climate change. 

  • The watering down can also increase the number of humanitarian crises, including via food shortage, people displacement, and conflict, and force communities to cope independently with a worsening climate and its consequences.

  • The absence of support has economic consequences for both developing and developed nations.

  •  Financial crises and economic downturns in one region can have extensive repercussions due to the interconnectedness of the global economy.

  • Finally, climate-change-induced instability can have security implications as well, as conflicts and tensions emerge in vulnerable nations and threaten to spill across borders.

How will L&D funds ensure climate justice?

  • As we strive to mitigate the worst impacts of climate change, we must remember that adaptation and L&D are not mutually exclusive concepts.

  • They exist on a continuum of climate resilience, and both have a place in our collective efforts to combat climate change.

  • A successful response to climate change requires us to balance the proactive measures of adaptation with the moral and financial responsibility. 

  • The L&D fund was conceived as a critical component of global climate action, recognising that some of the consequences of climate change are irreversible and beyond the capacity of vulnerable nations to handle. 

  • So to achieve climate justice, rich countries must meet their obligations to reduce emissions and deliver finance in line with what is fair.

  • Thus uphold the principles of equity, justice, and solidarity in the face of a changing climate.

  • Global climate action will get derailed, putting more pressure on the already beleaguered COP 28 talks later this month.



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Learnerz IAS | Concept oriented UPSC Classes in Malayalam: Loss and Damage fund UPSC NOTE
Loss and Damage fund UPSC NOTE
Learnerz IAS | Concept oriented UPSC Classes in Malayalam
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