How can you fight the growing climate change phenomenon, when the fuel subsidy is more than the grants on climate finance of various developed countries? A recent report says that over the years, developing countries including India got billions of dollars in climate finance but that is much less than fossil-fuel subsidies to consumers; thus negating climate compatible development.

The report, ‘At cross-purposes: subsidies and climate compatible investment’, says, “For the 42 developing countries where data are available on either subsidies or climate finance, the scale of fossil-fuel subsidies to consumers, at $396 billion in 2011, is 75 times higher than the average annual approved climate finance of $5 billion from 2010-2012.”

The 36-page report is prepared by Shelagh Whitley for the UK's leading independent think tank on international development and humanitarian issues, the Overseas Development Institute.

In a recent report, the International Monetary Fund (IMF) also termed fossil fuel subsidies as a bad policy.

“Five countries (China, Egypt, India, Indonesia and Mexico) appear in both, the list of top 12 recipients of climate finance and the list of top providers of fossil fuel subsidies to domestic consumer,” it says. India alone has a total of fuel subsidy bill of around 10 percent of the GDP.

However, the report highlights the scale of climate finance support to developing countries by the developed nations is not sufficient to address the mitigation and adaption. According to the report, to address climate change, the developing countries need $0.6 trillion to $1.5 trillion.

The report suggests that the developed countries should take extra effort in terms of reducing emissions and helping developing countries in this regard.

Read the report