The Business Press – June 29, 2023 at 05:45AM
Listening to President Biden and Indian Prime Minister Narendra Modi during their recent discussions, one might believe that the United States and India are steadfast partners in confronting climate change. Both leaders emphasized their respective countries’ ambitious climate policies and announced new collaborations aimed at reducing emissions.
However, beneath the surface lies a challenging rift. During his visit to Washington, Prime Minister Modi confidently stated that India is the only G20 country to fulfill the climate commitments established before the Paris Agreement. While alluding to financial support, he carefully omitted mentioning certain countries that had contributed, including the U.S., which has yet to fully meet its international climate obligations. Modi went on to assert that India has played a leading role in protecting the environment without causing any harm.
In response, President Biden accepted responsibility for the damage caused by the United States’ development over the past three centuries. He cited the Inflation Reduction Act as evidence of the country’s commitment to rectifying past wrongs.
Though these underlying tensions may not be immediately apparent, they hold significant importance. Collaboration between the U.S. and India on climate change serves the interests of both nations and the global community at large. However, India is rightly insistent that the world acknowledges the West’s historical responsibility for the current climate crisis, while underscoring the developing world’s need for increased support in meeting climate goals.
Conversely, the U.S. aims to position itself as a global climate leader, but faces limitations. While the U.S. recently passed a comprehensive $370 billion climate law to support a domestic clean-energy revival, the complex political dynamics in Washington hinder comprehensive resolution of the demands raised by countries such as India.
Consequently, a diplomatically intricate situation has arisen, bridging the gap of a seemingly insurmountable historical context. Officials from both countries realize the urgency in attempting to find common ground, as their success or failure will inevitably shape the climate fight for years to come.
The historical context cannot be ignored. Over the past century and a half, the U.S. has contributed 20% of global emissions, far surpassing any other country. In contrast, India’s development was delayed due to colonization during the Industrial Revolution and subsequent economic policy decisions that kept the country relatively impoverished. Consequently, despite its vast size, India has contributed just 4% of global emissions.
This historical context frequently surfaces in climate diplomacy. For instance, the 1997 Kyoto Protocol granted emissions leniency to developing countries for this very reason. During negotiations leading up to the Paris Agreement, India demanded greater financial assistance from developed nations. Despite the anticipation of a surge in India’s emissions, its leaders consistently remind their counterparts that the country’s contribution to the problem has been limited, while its rapid growth requires adequate industrial support.
Prime Minister Modi has set ambitious targets for renewable energy deployment, albeit without committing to phasing out the country’s coal industry. Policymakers across the political spectrum emphasize that ensuring a stable power supply remains a priority for constituents, overshadowing concerns about addressing climate change head-on. Balancing energy needs with environmental aspirations becomes a tightrope act for Indian lawmakers.
Amitabh Kant, the Indian official responsible for this year’s G20 summit, conveyed the country’s nuanced stance, highlighting India’s limited carbon footprint and its potential to lead the transition. Kant stressed the necessity for market transformation, urging a global push towards renewable energy to drive down costs and make green technologies economically viable. Increased availability of capital and favorable trade relations could enable India to export its green products.
While the U.S. possesses the potential to contribute significantly to achieving these objectives, the Biden administration’s ability to deliver remains constrained. Although the Inflation Reduction Act will reduce the cost of clean energy technologies worldwide, it has raised concerns among Indian policymakers due to perceived pro-U.S. subsidies that have impacted India’s industry and hindered the growth of its own clean energy economy. U.S. financing allocated towards clean energy projects in India remains limited, with a promise of $11 billion yet to be fully allocated by Congress.
Forging ahead, the U.S. administration aims to mobilize the private sector and multilateral development banks, particularly the World Bank, to provide India with the necessary capital. Both countries announced the creation of “investment platforms” to attract private capital towards renewable energy projects in India. John Kerry, Biden’s climate envoy, emphasized the administration’s unity in urging banks to increase lending and engagement in climate-related efforts, leveraging the trillions of dollars required.
Another potential avenue lies in aligning strategic government investments, enabling both countries to benefit from each other’s commitments to clean energy. Coordinating industrial policy between the U.S. and India presents a promising opportunity to address climate change and explore investment opportunities, as suggested by Vinay Chawla, a senior advisor for climate finance at the U.S. State Department.
While these measures are steps in the right direction, the immense historical and political context cannot be entirely escaped. Their significance ranges from being a mere distraction at best to a significant obstacle potentially derailing global climate efforts at worst.
The complex U.S.-India climate relationship intertwines challenging historical dynamics with the urgent need for collaborative action. It is crucial for both nations to navigate this complexity and find common ground, as their efforts will shape the trajectory of the global climate fight for years to come.
The Business Press 