Former NITI Aayog CEO and India’s G20 sherpa, Amitabh Kant has emphasised the need for institutions like the World Bank to transform into climate banks, so as to take on the challenges emanating from climate change.
Kant was speaking at India’s flagship annual conference, Raisina Dialogue 2024 on Wednesday, where he deliberated on ‘New Fuels, New Aspirations and a New Security: How Energy Access Shapes the World’.
He said that the emerging markets need to start seeing biofuels as a way to stimulate rural development, create jobs, and save foreign exchange. “We need to deploy mechanisms such as blended financing, credit enhancement measures such as guarantees, debt for climate swaps, climate policy performance bonds, green bonds, impact investing, and carbon pricing frameworks to further accelerate this transition,” he said.
He also highlighted the necessity to de-risk global projects, pointing out the disparity in interest rates- 2% for the developed world, 8% for India, 16% for African countries, and 22% for sub-Saharan countries.
Further, Kant proposed the establishment of a global agency to de-risk international projects and ensure their commercial viability. He said that international financial institutions must undergo a redesign and restructuring to align with the challenges of climate change.
“Establishing the right policy frameworks is crucial for engaging the private sector in renewable energy efforts, as demonstrated by India’s success,” Kant said at the conference.
The India G20 Sherpa also deliberated on ‘Solving the Energy Trilemma: Access, Affordability, Availability’. He highlighted that 80% of the global population lives in countries that are net importers of fossil fuels. Due to their dependence on foreign fossil fuels, approximately six billion people are vulnerable to geopolitical shocks and crises.
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“In contrast, renewable energy sources are available in all nations, but their full potential has yet to be realized. The International Renewable Energy Agency (IRENA) estimates that by 2050, 90% of the world’s energy can and should come from renewable sources,” Kant added.
(With Inputs from ANI)