FM Nirmala Sitharaman bats for new collective climate action goal

NEW DELHI: Finance minister Nirmala Sitharaman called for a “new collective quantified goal” in climate action that caters for the needs of developing countries without subjecting them to “growth-inhibiting” financing provisions.

Speaking at the G20 joint meeting of finance, climate & environment and foreign affairs ministers and central bank governors in Washington DC late Thursday, Sitharaman also sought a balance between developmental priorities and climate action, and greater access for developing countries to financial resources and technologies at a reasonable cost.

The minister underscored the need for an effective collaboration between developed and developing countries on the UN Framework Convention on Climate Change and the Paris Agreement, adhering to “the principles of equity and common but differentiated responsibilities”, according to a finance ministry post on microblogging platform X.

Such principles, experts said, would essentially allow poor and developing countries with limited financial muscle to have lower climate commitments than the rich ones, which have been the biggest per capita emitters of greenhouse gases.

Developing countries fear that, given their financial constraints, any aggressive climate pledges by them would hamper their economic growth and jeopardise efforts to lift millions out of poverty.

According to the G20 sustainable finance report of 2023, $4-6 trillion would be required annually for a global transformation to a low-carbon economy in sync with the Paris Agreement objectives. The Paris Agreement’s central aim is to keep the global temperature rise this century well below 2 degrees Celsius above pre-industrial levels, through a joint global action. New Delhi has committed to achieve net zero emissions by 2070. India has often called out developed nations for their failure to make climate finances available to developing countries vis-a-vis their commitments.

‘Jobs most pressing global issue’
Jobs, Sitharaman said separately, are the “most pressing global issue”, given the continued economic headwinds and rapid technological changes that are redefining the skills needed for youth to enter the job market.

The minister called on the World Bank to collaborate with countries to identify high-priority skilling sectors, with a focus on employment generation, skill matching and labour retention, and come out with an outcome-oriented action plan. The minister was speaking on the topic of how the World Bank should shape its future strategic direction and help clients create more jobs to keep pace with evolving megatrends.

Sitharaman asked the bank to undertake a multi-sector analysis on how emerging trends – such as global economic headwinds and rapid technological changes – influence both job creation and losses.

“This analysis should also consider factors like geopolitical fragmentation and its effects on sectors such as food production, exports and related employment,” she said, according to another finance ministry post on X.

She dwelt upon the need to explore alternative economic growth strategies, beyond traditional manufacturing, and the types of jobs they will generate.

On the sidelines of the World Bank’s annual rendezvous, the minister held meetings with her British counterpart Rachel Reeves and Odile Renaud, president of the European Bank for Reconstruction and Development.