In what can be termed as a step towards streamlining climate finance, one of the financial regulators of the Government of India has constituted an Expert Committee to recommend an approach towards development of a Sustainable Finance Hub.
India has on multiple international, reiterated that the developed countries, the rich nations, must provide finance for the poor countries, the developing world for carrying out adaptation and mitigation activities to combat the devastating effects to the changing climate.
Adaptation encompasses several steps that help adjust to a given situation wherein the disaster has happened while mitigation can be termed simply as steps taken to either prevent a disaster from happening or at the least, lessen the impact due to climate change.
These measures, called the Nationally Determined Contribution (NDC), will require Rs 162.5 lakh crore (USD 2.5 trillion) from 2015 to 2030 per year for climate action. While India can domestically raise this, it has been insisting on getting public money from rich nations for adaptation and mitigation actions.
“While India’s energy sector is one of the fastest growing in the world and has been attracting substantial investments, meeting the country’s climate goals will require proportionate, transformative investment increases at sectoral level,” a report from FICCI and UNEP had said.
International Financial Services Centres Authority (IFSCA) has been established as a unified regulator to develop and regulate financial products, financial services, and financial institutions in the International Financial Services Centres (IFSCs) in India.
Now, the IFSCA, in its endeavour to develop the required eco-system, has constituted an Expert Committee to recommend an approach towards development of a Sustainable Finance Hub and provide a road map for the same.
“The expert committee will be chaired by a former secretary to the Government of India, Ministry of Environment, Forest & Climate Change, C.K. Mishra said.
The committee consists of leaders across the sustainable finance spectrum, including international agencies, standard setting bodies, funds, academia, and consultancies, a release from the IFSCA said.
India has committed ambitious climate action, which is evident in its commitment towards its intended Nationally Determined Contributions under Paris Agreement 2015.
“Raising financial resources for climate change adaptation and mitigation actions of this scale needs active participation of international investors. IFSCA envisions GIFT-IFSC as a global hub for sustainable finance thereby acting as a gateway for channelising foreign capital into India,” the release added.
The Expert Committee will study the current regulatory practices in Sustainable Finance across major international financial jurisdictions and recommend a robust framework to develop a world-class sustainable finance hub at IFSC.
It will identify existing and emerging opportunities in Sustainable Finance for GIFT-IFSC to act as a gateway to meet India’s requirements and recommend a short, medium, and long-term vision/roadmap on Sustainable Finance.
The Committee may also examine and address any other issues which are important though not specifically mentioned in the Terms of Reference.
IFSC has asked the Committee to submit its report along with recommendations within three months from the date of holding its first meeting.