India's climate commitments face a critical financing gap, underscoring the urgent need for a robust global climate finance framework. As the world gathers for the pivotal COP29 in Baku, India emerges as a central player in shaping the New Collective Quantified Goal (NCQG) on climate finance, a landmark outcome that could unlock the resources required to drive ambitious climate action in the developing world.

Bridging the Climate Finance Divide: India's Unwavering Stance

Defining the NCQG: India's Vision for a Transformative Outcome

India's climate journey has been marked by a steadfast commitment to domestic action, but the scale of the challenge demands a global response. The country's latest Economic Survey estimates a staggering USD 2.5 trillion price tag to meet its Nationally Determined Contributions (NDCs) by 2030, while its first Adaptation Communication outlines a cumulative adaptation financing need of USD 673 billion. India's position is clear: the onus lies on developed nations to provide the necessary finance and technology to support the developing world's climate efforts, as enshrined in the UNFCCC and Paris Agreement.As the world prepares for COP29 in Baku, the NCQG negotiations present a pivotal opportunity to bridge the climate finance divide. India, alongside other developing countries, will be at the forefront, demanding greater ambition and transparency in the new global climate finance goal. The country's recent submission to the ad-hoc working group calls for a quantum of at least USD 1 trillion per year, primarily in the form of grants and concessional finance, rejecting any attempts to expand the contributor base or differentiate between beneficiaries.

Navigating the Fault Lines: Developed vs. Developing Country Perspectives

The landscape of NCQG negotiations reveals a deep divide between developed and developing country parties. Developed nations, such as the US and EU, have focused on broadening the contributor base and targeting the most vulnerable, while developing countries, including the G77 plus China and LMDC, have consistently called for a discussion on the quantum based on their evolving needs.India's stance remains unwavering, rooted in the principles of equity and differentiation. The country firmly opposes any dilution of developed countries' legal obligations under international law, insisting that they must provide the necessary financial resources and access to technologies to enable climate action in the developing world. The recent joint statement by the BASIC ministers underscores this position, expressing "deep concerns" over attempts to shift the burden and calling for a shift in the NCQG quantum "from billions to trillions of USD per year."

Unlocking the Path to Ambitious NDCs 3.0

The success of the NCQG negotiations in Baku will have far-reaching implications for the future of global climate action. A robust and ambitious climate finance agreement will create the necessary momentum for countries to submit more progressive and ambitious NDCs in 2025, known as NDCs 3.0.India emphasizes the importance of aligning the NCQG time frame with the NDC submission process, arguing that the new finance goal must be consistent with the resources required to meet the updated national climate commitments. Without the assurance of available and affordable finance, it will be an arduous task for developing countries to ratchet up their climate actions over the next decade.

Catalyzing a Transformative Climate Finance Ecosystem

Achieving the scale of climate finance needed to support developing countries' climate efforts will require a multifaceted approach. NRDC's analysis outlines various pathways to scale up international climate finance from a floor of USD 100 billion to as high as USD 1 trillion, including raising new and innovative sources of finance, reforming multilateral development banks and financial institutions, and better mobilization of private finance.India's role in this endeavor will be pivotal, as it continues to champion the cause of equity and differentiation within the developing country bloc. The country's unwavering stance on the NCQG negotiations, coupled with its domestic climate leadership, positions it as a key driver of the global climate finance agenda.Ultimately, the success of India's NDC 3.0 and the broader climate commitments of the developing world hinge on the willingness of the developed nations to support the clean energy transition and the ability of the Baku climate talks to deliver a transformative NCQG on climate finance.