For a better policy towards climate change, India needs a climate budget tagging. Do you agree with this view? Analyse (200 Words)
Refer - Financial Express
Enrich the answer from other sources, if the question demands.
IAS Parliament 3 years
KEY POINTS
· Recently, Climate Policy Initiative (CPI), released a report commissioned by the Shakti Sustainable Energy Foundation, mapping green finance flows from source to end-use. It posits that although there are indications of an overall upward trend, India’s tracked green investment flows fall far short of its financing requirements.
· The estimated $38 billion investments directed towards mitigation sectors between FY16-18 are paltry and disproportionately allocated between sectors. Since green finance is now an increasingly significant area of interest for government, these numbers are important from the policy and regulatory angles, especially as the report also identifies the challenges faced in defining and tracking green finance across its value chain in India.
· Since various countries, including neighbours like Nepal and Bangladesh, have already begun to assess and review their climate-related expenditures through Climate Public Expenditure and Institutional Review (CPEIR) based on UNDP’s methodology, India also needs to adopt a “Climate Budget Tagging (CBT)” tool.
· The CBT could be rolled out in a similar way that other social priorities are tagged. For example, the gender, scheduled castes & scheduled tribes, and child development component of the budget is a case in point that has made it easier for the government to review and recognise the impact of budgetary support on these sections.
· However, in India, though there is a political will to push the green growth agenda, the state and Union budgets in their current format are not conducive to this “green transition”. The government needs to restructure the way it reports schemes and action plans to facilitate meaningful intra and inter-state comparison of the climate objectives achieved so far.
· The tracking exercise undertaken by CPI is a step in this direction. It presents a conservative picture of who finances what and the extent to which finance is aligned with the country’s policy objectives.
