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Intervention of Finance Minister Arun Jaitley - Climate Change Finance Ministerial Organized by the World Bank

Climate change is one of the greatest challenges for humanity. For the first time, Man has altered the planet sufficiently to create the risk that the planet, as we know it, ceases to exist. But as John F. Kennedy said, because man created the problem it should be within the reach of man to solve it. If ever collective action were needed, this is the occasion for doing it.

This collective action will require technology and of course finance. It will require each country to contribute according to its needs, situation and capability. It will require sacrifices and political will from all.

India is prepared to do its part toward solving this common problem. We have a large stake in this not least because we recognize that a significantly warmer planet will disproportionately affect poorer parts of the world, including India. We are also acutely aware that rich countries can more easily and affordably adapt to climate change than us, hence our large stake in mitigation. Indeed, we have implemented a series of actions toward this goal:

--in petroleum, we have moved from subsidizing carbon to taxing carbon at levels well above the norm of $25/ton of CO2; in cooking gas we have deregulated prices and using direct benefit transfers to further reduce inefficiencies;

--we have increased the levy on coal and are using the proceeds to finance clean projects;

--we have embarked on an ambitious program of promoting non-renewable energy. The target for generation of energy from solar sources in the year 2022 has been enhanced from 20 GW to 100 GW;

--we are investing in railways so that lower carbon modes of transport are preferred for freight;

--we are promoting the use of solar pumps in agriculture and solar lamps for poorer households.

All these actions have been implemented despite our basic development challenge of serious energy deficiency: Our per capita electricity consumption is a fraction (1/37th) of that in the average European country.

The challenge of climate change can be posed simply as reconciling the energy needs of poorer countries with the common global objective of restricting emissions of GHGs. The former will require that India and similar countries are provided adequate carbon space. But as on a realistic growth and technology assumptions, coal will remain the most important source of energy for India and many other energy deficient countries. Unless coal can be greened and cleaned, it may not possible to reconcile development and climate change goals.

The international community needs to therefore go on a war footing to generate greener technologies especially technologies that can help green coal. Our richer partners can contribute in three ways:

a. Pricing carbon quickly and ambitiously to provide the long run incentives and the certainty for the private sector in rich countries to invest in creating and disseminating such technologies.

b. Contributing finance to the generation of the global public good of cleaner fuels and technologies. The world needs to collectively invest large sums of money in the search of these greener alternatives.

c. Contributing finance to helping the poorest countries to mitigate and adapt to climate change. In doing so, financing should not be tied-as some creditors are doing--to the use of renewable sources alone.

In conclusion, India is committed to making a significant contribution to tackling climate change to the extent it can. We urge our richer partners to make theirs by way of pricing carbon quickly, especially when world prices have declined sharply, and to devote their resources to developing clean technologies. Their responsibility in this effort is undeniably greater.