Green Climate Fund and India: Latest Developments

Recently, Accreditation Master Agreement (AMA) has been signed between Green Climate Fund (GCF) and National Bank for Agriculture and Rural Development (NABARD).

Several of the mitigation and adaptation targets, articulated in India’s Nationally Determined Contribution (NDC), to meet the international climate obligations are aligned with the Fund’s strategic impact areas – viz clean energy, energy efficiency, cities, transport, forestry, agriculture, water health and ecosystems.

India’s NDC is among the few that make specific reference to the GCF specifically with regard to its role as a source for low-cost finance for its 40% non-fossil fuel based power target.

India, with numerous climate change and developmental challenges, needs to engage more purposefully and actively with GCF. The accredited entities need to proactively engage with GCF to take advantage of the available opportunities.

The Green Climate Fund (GCF) is one of the operating entities under financial mechanism set up under the United Nations Framework Convention on Climate Change (UNFCCC) to provide support to developing countries in combating climate change, with resources to be generated from funding by developed country Parties and various other public and private sources. It supports both climate change adaptation and mitigation projects in developing countries.

So far, one project from India on “Installation of Ground Water Recharge System” in Odisha has recently been approved by the GCF for $34 million. Another proposal on coastal areas has already been submitted to the GCF Secretariat and several more projects are in the pipeline.

India has nominated a total of five direct access entities for accreditation by the GCF. Two of these from the public sector and three from the private sector for accreditation by the GCF. The public sector entities are NABARD and Small Industries Development Bank of India (SIDBI). The private sector entities nominated are YES Bank, IDFC Bank and IL&FS Environmental Services. So far, NABARD and SIDBI have been accredited by the GCF.

NABARD is the first entity from India to be accredited as Direct Access Entity (DAE). The signing of AMA between GCF and NABARD is an essential first step for accessing the GCF resources to help safeguard the lives, property and livelihoods of millions of people against climate change impact.