In 2010, the developed countries agreed at the United Nations Framework Convention on Climate Change (UNFCCC) to mobilise more and more funds towards climate change combating projects in developing countries, so that by 2020, the annual funds transfers would reach $100 billion.

Last Wednesday, the Organisation for Economic Co-operation and Development (OECD) reported that developed countries were indeed sending more money for such projects. It reached $60 billion in 2014, up from $52 billion in the previous year.

“Our estimate paints an encouraging picture of the progress,” said OECD Secretary-General, Angel Gurría.

Happy news to developing countries, right? Not quite.

Green-wash alert

The big nuance is what counts as climate finance. And on that nuance hangs the fate of this planet.

The use of the word ‘paint’ in the Secretary-General’s comment is perhaps ominous because it mirrors the general fear that the developed countries will green-paint projects, twisting facts to call any project green, in order to meet their commitments. For example, the World Bank calls the Delhi-Kolkata Industrial Corridor project ‘green’, because the dedicated freight lines will result in many vehicles going off the roads. (The World Bank is giving $ 1.1 billion to a segment of the project. )

“Greening has become a racket today. Everything is ‘green’,” says former Union Environment Minister Jairam Ramesh, (though not with reference to freight corridor.)

In a recent chat with BusinessLine , Peter Bakker, President and CEO of the World Business Council for Sustainable Development, said the dedicated freight corridors could be called a green project (only) if all the electricity used by the freight trains is produced by non-fossil fuels.

Funding is key

Funding is expected to be central at the forthcoming climate negotiations at Paris this December. The fear is that the developed countries will just re-label every project green, and consequently, no additional funds will be mobilised for truly green projects. Also, not many believe the developed world would benevolently shovel funds into developing countries’ green projects. In August, India’s Chief Economic Adviser, Arvind Subramanian, wrote a letter to the Prime Minister advising him that India should not seek climate funds from developed countries. “Are the commitments of cash-strapped advanced countries plausible? After all, the US cannot muster the will and ability to contribute a few hundred million dollars to increasing the IMF’s resources”, he notes.

Backing Subramanian’s assessment is the funds pooled into the Green Climate Fund, set up by the UNFCCC— in five years, the fund has got commitments of a paltry $10.2 billion; the actual money received is only $5.8 billion. Even the $100 billion ambition is far inconsistent with the need for funds. Absence of affordable finance puts the planet in peril. According to the Ministry of Environment, Forests and Climate Change, India would need $2.5 trillion between now and 2030, or $167 billion a year, to meet its recently-announced international commitments to reduce greenhouse gas emissions.

In its submission to the United Nations Framework Convention on Climate Change, India has said that its emission reduction efforts would be underpinned by ensuring that 40 per cent of its power capacity by 2030 will be based on non-fossil fuels. This, it said, would be achieved “with the help of transfer of technology and low cost international finance.”

Against this backdrop, the reality is, what little is promised is taken away by green paint.

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