FICCI welcomed the adoption of the Paris Agreement, stating that a positive outcome from Paris was crucial for business and industry to have a clear and long term policy signal.
FICCI congratulated the Indian Government for playing a positive role in the COP 21 negotiations in Paris and ensuring that the key tenets of the Indian position were safeguarded in the final agreement.
FICCI stated that the fact that principles of equity and common but differentiated responsibilities has been retained is a big factor in the success of the outcome, as these are the underlying principles that India and Indian business and industry saw as bridging the trust deficit and ensuring climate justice.
The aspect of climate finance, though spelt out, leaves doubt on the amount that will be made legally binding. What is clear through is that the agreement places a clear responsibility on developed countries to mobilize climate finance to developing countries for realizing their mitigation and adaptation targets. The final Agreement, which governments approved on December 12, sets out a clear pathway for global climate policy. Governments reaffirmed their commitment to keeping the average global temperature increase to 2°C above pre-industrial levels and pursue efforts to keep this to 1.5°C.
Dr. Jyotsna Suri, President, FICCI said "It is a major step in establishing the direction for a long term global climate policy and will surely set a clearer signal for business and industry that mitigation and adaptation efforts will need to be stepped up. While differentiation in responsibilities is important, it is a common responsibility for all humanity. In that sense, it is a win not only for India but also for all countries that were party to the final Paris Agreement."
Harshvardhan Neotia, President Elect, FICCI said that "while governments have architected the agreement, businesses can now look forward to gearing up to tackling the challenge of climate change in a renewed confidence."
Acknowledging that the current commitments may fall short in limiting global warming till the 2 degree threshold, the Paris text includes a two-stage that ramps up climate ambition over time. Countries which have specified targets till 2025 have been urged to come up with new targets in 2020, while those with 2030 targets are invited to communicate or update them. This is also in sync with India's expectations from COP 21.
Although there are some areas of concern such as meeting the incremental cost of intellectual property rights associated with the transfer of climate friendly technologies that Indian industry feels should have been met through an international financial mechanism, whereas the Paris text lays more emphasis on cooperation and collaborative approaches for facilitating access to low carbon technologies.
The omission of liability and compensation from the "loss and damage" provision is also an issue. However, overall, the Paris Agreement gives a clear signal to markets about the direction in which the global economy is headed. It indicates where countries as well as business and industry must direct their efforts at, and the potential business opportunities that the corporate sector can harness in markets for clean energy, energy efficiency, clean cities and other areas of mitigation as well as adaptation.
