For almost a quarter-century, the world has placed its faith in international agreements to address the threat of climate change. The reasoning is that a binding agreement is the best way to ensure that greenhouse gas emissions are capped at a level low enough to prevent dangerous climate change. The effort to set emissions limits got off to a good start in 1992, when the United Nations Framework Convention on Climate Change (UNFCCC) was first signed. The UNFCCC has become about as universal as a treaty can be, with over 190 signatories. But the process to put forward an agreement to set binding emissions limits for individual countries soon became difficult over the argument put forward by most developing countries: that rich countries should shoulder the entire burden of reducing emissions. In the late 1990s, this argument prevented the United States from ratifying the Kyoto Protocol, the main mechanism for reducing global emissions. The U.S. Senate reasoned that unless China and other large developing countries agreed to limit their emissions, an international agreement would be meaningless.
This divide was finally bridged in a big way during President Obama’s visit to China in early November, when the world’s two largest emitters, the United States and China, announced a bilateral agreement in which Washington pledged to reduce emissions by one-quarter below 2005 levels by 2025, and Beijing committed to preventing its emissions from growing after 2030. The Sino-American agreement comes at a critical time for the global climate negotiations: the Kyoto Protocol, despite America’s refusal to ratify it, remains the world’s only binding international agreement to reduce emissions. And it is scheduled to expire in 2020. Most climate experts believed that a replacement agreement should have been formulated by the end of 2015 to have allowed enough time for it to come into force before 2020.
So far, India’s stance on climate change has blended genuine concern for the issue with a resolute refusal to consider limiting its own emissions. On the one hand, the Government of India has long expressed its concern over the effects of climate change. It began formulating policies to support renewable energy in its 2008 National Climate Change Action Plan. India’s current Prime Minister, Narendra Modi, has been outspoken in calling attention to the challenge of climate change. As Chief Minister of Gujarat he promoted policies to expand renewable energy production and to help the state adapt to the effects of climate change. But Modi’s personally progressive stance on climate change contrasts sharply with New Delhi’s longstanding refusal to consider limiting India’s emissions while India’s per-capita emissions, at 1.7 metric tons in 2010, remains below the global average of about 5 metric tons. Successive Indian governments have maintained that poverty reduction and expanding access to energy, not reducing emissions, must be the country’s chief priorities. At the UN Climate Summit in September, India’s Environment Minister repeated this stance, implying that India would not limit its emissions for at least thirty years.
Unfortunately, the world does not have that long to wait. The world needs robust commitments from India that it will slow and eventually peak emissions as part of a comprehensive, post-Kyoto agreement on climate change. But equally, the world cannot ignore India’s development priorities, or the fact that external pressure rarely goes down well in New Delhi.
Efforts taken by Indian Corporations: India is among a handful of major polluters that is on track to achieve the national targets set to address climate change under the Paris Agreement. Industry and business, too, are taking cue from the policy signals and climate related measures being implemented by the government. Companies in the BSE Top 200 are setting targets to reduce the amount of carbon dioxide their operations produce, increasing the use of renewable energy and making their units more efficient in order to consume less energy. These companies are increasingly aligning themselves with the climate goals the government has set.
But it is not just the top stock-market performers that are responding to climate risks. Industrial units in energy-intensive sectors such as aluminium, cement and textiles have reduced the amount of carbon dioxide they produce, resulting in a 1.93% reduction in India’s greenhouse gas emissions. India Inc, according to a recent report by the Carbon Disclosure Project (CDP) India, is aligning with the climate goals that the government has set under the Paris Agreement. Its India Climate Change Report 2017 is based on responses from 51 companies, including 43 from the BSE Top 200. Infosys, Tata Motors, Dalmia Cements, Wipro and Indian Oil Corporation were among the respondents. Industry is of the view that the government needs to focus on policy that will help create an ecosystem for innovation and scale-up. “We need policies that will scale up innovations that are already taking place, and facilitate market creation for climate mitigation business models that are addressing energy access, public service delivery in areas such as waste, water, mini grids (and) low carbon transport,” said Roy Choudhury, who is FICCI’s point person on environment and sustainability. Industry representatives said in order to scale up efforts to address climate change efforts, challenges such as the availability of climate-friendly technology, finance and capacity building need to addressed. This would include innovative financial mechanisms such as green bonds and deployment and commercialization of technologies in renewable as well as conventional sources.
India’s Strategy in Negotiations: In the year 2016, at Paris, India upgraded its official policies on climate change negotiations—taking a more proactive approach to a global challenge that puts millions of its own citizens at risk—and placed itself in a leadership role. Along with more than 190 countries, it vowed to cut down carbon emissions, move towards renewable energy sources, and invest in green energy technology. Earlier this month, Parliament ratified the Paris Agreement, bringing it a step closer to global enforcement.
A week later in Montreal, however, India opposed the International Civil Aviation Organization’s (Icao’s) proposal to reduce greenhouse gas emissions from international flights. But then on 15 October in the Rwandan capital Kigali, it worked with the other signatories to the 1989 Montreal Protocol on Substances that Deplete the Ozone Layer to introduce a major amendment on phasing out hydrofluorocarbons (HFCs)—a potent greenhouse gas that is commonly used in air conditioners and refrigerators. The question here is: What do the positions taken at Kigali and Montreal tell us about our bargaining strategy?
First, the Kigali deal: This is a major development because, even though the Kigali agreement may not have received the same kind of public attention as the more broad-based Paris deal, it is—unlike the latter—legally enforceable. India has agreed to reduce its HFCs by 85% by 2047 with 2024-26 being the baseline year period. In other words, India can increase its HFC consumption for the next decade. After 2026, it has two years to maintain that level and then work towards a reduction.
The timeline is important because domestic air conditioner use in particular is growing rapidly in the country, and if manufacturers are forced to move to expensive alternatives, the consumer will suffer. At the same time, the switch to cleaner alternatives also has to be made before the Indian boom leads to devastating consequences. Also, accessing and developing alternative technologies is a major concern—developed countries hold most of the patents for these technologies, while other options such as hydrocarbons are still a work-in-progress
India had initially wanted a more relaxed timeline but after several years of failed negotiations, it went to Kigali with a different approach. At the negotiating table, India compromised on the timeline but also compelled developed nations to pursue more aggressive targets. On the other hand, the Montreal deal has been backed by 65 countries and opposed by major developing countries like India and Brazil. Known as the Carbon Offsetting and Reduction Scheme for International Aviation (Corsia), this plan allocates countries and their carriers a fixed annual quota of emission units using 2019-20 as the baseline year. When one party crosses their limit, they will have to buy units from the open carbon exchange.
Such a global market-based measure puts an unfair economic burden on developing countries like India where the aviation sector is still growing. The Icao proposal also does not take into consideration historical responsibilities—in comparison, the Kigali pact is more equitable because it allows different countries different timelines and baselines for emission cuts. The US and EU, for instance, have to cap their HFC levels in 2019; for China and Brazil, the deadline is 2024; for India, it is 2028. Participation in the Icao proposal is voluntary for now but it will be interesting to see how India navigates this space in the long term.
In the short term, the focus will be on the next climate change summit at Marrakesh, where India is expected to play tough—it has led by example and shown to the world that it willing to go the extra mile when needed but at the same time, it (and other developing countries) cannot be expected to do all the heavy lifting. Specifically, the environment minister has indicated that he would like to see some money on the table.
In a statement released during the Paris treaty ratification, it was said that the “$11 billion per year climate finance goal has not been met”; that “$10.3 billion committed to the Green Climate Fund does not match the enormous finance and technology requirements indicated by developing countries”; and that “on the technology and capacity-building front also, not much headway has been made”. He has made it clear that India will “insist on a concrete road map from developed countries”. This is the key if the Paris treaty is to be effectively implemented and enforced, and India’s own efforts to ensure a fair and equitable solution will empower is leadership.