The Paris Agreement
- The Paris Agreement at the 21st Conference of Parties (COP 21) under the United Nations Framework Convention on Climate Change (UNFCCC) by 195 nations in Paris in December 2015 sets a roadmap for all nations in the world to take actions against climate change in the post-2020 period.
- This universal agreement will succeed the Kyoto Protocol.
- The agreement reflects the principles of equity and common but differentiated responsibilities and respective capabilities (CBDR-RC), in the light of different national circumstances.
- The Paris Agreement aims at keeping the rise in global temperatures well below 2°C.
- The new agreement seeks to follow a country-driven approach (bottom-up approach) with the contribution by each country to the global fight against climate change determined at national level.
Key Provisions of the Paris Agreement
- The principle of CBDR-RC has been applied across all the important pillars of the agreement (mitigation, adaptation, finance, technology development and transfer, capacity building and transparency of action and support). This was one of the contentious issues between developed and developing countries during the negotiations.
- The developed countries argue for deeper cuts by India and China despite the fact that they have historically contributed less to the global emission of greenhouse gases.
- The Paris Agreement invites Parties to submit their first nationally determined contributions prior to the submission of their instruments of ratification, accession, or approval of the Agreement.
- However, this requirement stands satisfied if a Party has already communicated its INDC prior to joining the Agreement.
- To achieve the long-term temperature goal of holding temperature increase to below 2°C, in the context of sustainable development and efforts to eradicate poverty, Parties in the Agreement aim to reach global peaking of greenhouse gas emissions as soon as possible.
- Given the trends in global warming, even if the temperature rise is restricted to below 2°C, adaptation support would be required for developing countries like India.
- The agreement establishes the global goal on adaptation – of enhancing adaptive capacity, strengthening resilience and reducing vulnerability to climate change.
- The agreement sets a binding obligation on developed countries to provide financial resources to developing countries for both mitigation and adaptation while encouraging other countries to provide support on a voluntary basis.
- The decision also sets a new collective quantified goal from a floor of US$ 100 billion per year prior to 2025, taking into account the needs and priorities of developing countries.
Technology Development and Transfer
- The Paris Agreement contains strengthened provision on technology development and transfer with a new technology framework being established.
- The emphasis on R&D and innovation in the Paris Agreement is a critical step in furthering the implementation of the provisions of the Convention.
- The transparency mechanism of action and support under the UNFCCC was differentiated for developed and developing countries.
- The information provided by the developed countries in their National Communications, Biennial Reports (BR), etc. is subject to international assessment and review (IAR) while that provided by developing countries in their National Communications and Biennial Update Reports (BUR) is subject to international consultation and analysis (ICA).
- The agreement also establishes a framework for global stocktake to assess the collective action towards achieving the long-term goals mentioned in the Agreement. The first stocktake is slated for 2023.
- The Paris Agreement will come into force only when at least 55 Parties to the Convention, accounting for at least an estimated 55 percent of total global greenhouse gas emissions, have deposited their instruments of ratification, acceptance, approval or accession.
- While there is no universal definition of green finance, it mostly refers to financial investments flowing towards sustainable development projects and initiatives that encourage the development of a more sustainable economy.
- Green finance includes different elements like greening the banking system, the bond market and institutional investment.
- Green development is also important for India though green finance is yet to pick up.
- So far, four banks have issued green bonds in India. Proceeds from these bonds are mostly used for funding renewable energy projects such as solar, wind and biomass projects and other infrastructure sectors, with infrastructure and energy efficiency being considered as green in their entirety.
- The Securities and Exchange Board of India (SEBI) has also recently approved the guidelines for green bonds.