GS Paper 3
Syllabus: Economy/ Environment Conservation
Source: IE
Context: The economic toll of climate change is staggering, with recent UN studies revealing that global GDP could have been 37% higher without warming since 1960.
What is Climate Change?
Climate change refers to long-term alterations in temperatures and weather patterns. While natural factors like solar activity and volcanic eruptions can contribute, human activities, especially the burning of fossil fuels, have been the primary driver since the 1800s. From 1970 to 2021, nearly 12,000 climate change-induced disasters occurred, causing over 2 million deaths and $4.3 trillion in economic losses.
India ranked 7th in the Global Climate Risk Index 2021, indicating high exposure and vulnerability to climate risk events. Its diverse climate faces various temperatures, precipitation patterns, and extreme weather events, impacting the economy spatially and temporally.
Impact of Climate Change on the Economy:
| Impacts | Description |
| Reduced Agricultural Productivity and Yield | Climate change can disrupt crop cycles and lower agricultural yield |
| The southwest monsoon has also become unpredictable. The annual average rainfall in India has gradually declined while intense wet spells as well as dry spells have increased in India. | |
| Setback to Industrial and Service Sector | Increased operational costs, reduced profits, and infrastructure damage can occur due to climate-related regulations, investment shifts, and extreme weather events, affecting industrial and service sectors. |
| Infrastructure Damage | Extreme weather events like floods and heatwaves induced by climate change can cause significant damage to infrastructure, leading to economic losses. |
| Labor Market Impacts | Climate-induced health hazards may reduce productivity and prompt migration from climate-vulnerable areas; Global job losses from heat stress by 2030. |
| In 2020, the World Bank said that India could account for 34 million of the projected 80 million global job losses from heat stress-associated productivity declineby2030. | |
| Risks for Banks and Financial Institutions | Physical and transition risks from climate change can affect banks and financial institutions directly and indirectly, impacting their credit, market, liquidity, operational, and reputational risks. |
| Impacts on High-Emission Industries | Industries contributing to high greenhouse gas emissions face challenges in transitioning to cleaner technologies, affecting electricity production, transportation, and other sectors. |
| Resource Scarcity | Climate change worsens water scarcity, leading to conflicts over shared water resources, and impacting agriculture, hydropower, and economic activities. |
| Erupted Arctic Economic Opportunities | Melting Arctic sea ice opens economic opportunities but also raises concerns over resource exploitation and territorial disputes among nations with interests in the region. |
| Climate-induced Conflicts | Climate change exacerbates existing tensions and conflicts over resources, particularly in regions facing political instability and economic challenges, such as the Syrian conflict influenced by prolonged drought. |
| Climate-related Supply Chain Disruptions | Extreme weather events disrupt global supply chains, causing economic losses and shortages of critical goods, exemplified by the 2011 floods in Thailand impacting electronics and automotive manufacturing. |
| Climate Gentrification | Climate change susceptibility prompts wealthier individuals and businesses to relocate, potentially leading to economic displacement and further marginalization of vulnerable communities in safer areas. |
Risk Emanating from climate change:
What should be done:
- Industrial Symbiosis: Revolutionize circular economy, incentivize waste reduction, and promote industrial symbiosis.
- Public-Private Partnerships: Encourage collaborations for green innovation, and establish dedicated funds for startups.
- Climate-Conscious Urban Planning: Prioritize sustainability in city planning, and integrate climate measures into Smart Cities Mission.
- Climate-Resilient Special Economic Zones (SEZs): Create zones with sustainable practices, and attract green businesses and industries.
- National Green Taxonomy: Establish a classification system for sustainable activities, and guide investments and policies.
- Green Bond Financing: Issue sovereign green bonds to fund climate-resilient infrastructure projects.
Conclusion:
India, the third-largest emitter of greenhouse gases in 2020, is projected to peak emissions between 2040-2045, posing challenges for its energy transition plans. A forward-thinking approach is crucial for navigating this trajectory effectively.
Mains Link:
Q.1 Describe the major outcomes of the 26th session of the Conference of the Parties (COP) to the United Nations Framework Convention on Climate Change (UNFCCC). What are the commitments made by India in this conference? (UPSC 2021)
Q.2 ‘Climate Change’ is a global problem. How will India be affected by climate change? How Himalayan and coastal states of India be affected by climate change? (USPC 2017)
Prelims Link
Q.1 In the context of India’s preparation for Climate-Smart Agriculture, consider the following statements: (UPSC 2021)
- The ‘Climate-Smart Village’ approach in India is a part of a project led by the Climate Change, Agriculture and Food Security (CCAFS), an international research programme.
- The project of CCAFS is carried out under Consultative Group on International Agricultural Research (CGIAR) headquartered in France.
- The International Crops Research Institute for the Semi-Arid Tropics (ICRISAT) in India is one of the CGIAR’s research centres.
Which of the statements given above are correct?
(a) 1 and 2 only
(b) 2 and 3 only
(c) 1 and 3 only
(d) 1, 2 and 3
Ans: (d)
Q.2 Which of the following best describes/describe the aim of ‘Green India Mission’ of the Government of India? (UPSC 2016)
- Incorporating environmental benefits and costs into the Union and State Budgets thereby implementing the ‘green accounting’.
- Launching the second green revolution to enhance agricultural output so as to ensure food security to one and all in the future.
- Restoring and enhancing forest cover and responding to climate change by a combination of adaptation and mitigation measures.
Select the correct answer using the code given below.
(a) 1 only
(b) 2 and 3 only
(c) 3 only
(d) 1, 2 and 3
Ans: (c)
Q.3 With reference to ‘Global Climate Change Alliance’, which of the following statements is/are correct? (USPC 2017)
- It is an initiative of the European Union.
- It provides technical and financial support to targeted developing countries to integrate climate change into their development policies and budgets.
- It is coordinated by World Resources Institute (WRI) and World Business Council for Sustainable Development (WBCSD).
Select the correct answer using the code given below:
(a) 1 and 2 only
(b) 3 only
(c) 2 and 3 only
(d) 1, 2 and 3
Ans: (a)
