Economics of Climate Change

We can still reverse some of the damage we have inflicted on our precious planet. But time is running out
Economics of Climate Change
"It is imperative to gauge the economic and financial impact of climate policy choices." [Representational Image] Publicdomainpictures [Creative Commons]

Climate Change is a direct consequence of human activities leading to rising water levels, temperature extremes, forest fires, floods, furious wind speed and untimely climate changes which we are experiencing in Kashmir on regular basis now.

Such episodes threaten to displace lives, livelihoods, and communities, with clear economic consequences which are at a high price tag and thereby Climate change is the biggest risk we are facing in India, and at a global level.

It is imperative to gauge the economic and financial impact of climate policy choices.

It points to concrete solutions that offer growth opportunities, driven by technological innovation, sustainable investment, and a dynamic private sector.

I am of the firm belief that we need to adapt for the future but side by side require to mitigate damage caused so far. This means pricing risk and providing incentives for green investment.

Cost of Climate Action may be lower than we think in the long run but aggressive carbon taxes would help individual nations meet their emission-reduction goals and scale up action.

In J&K we have not started the basic action yet of GHG emission directory so that we can go for carbon tax. Harnessing financial opportunities can open enormous opportunities ranging from transforming energy to reinventing protein.

Everyone has a responsibility to act and collaborate during this climate crisis.

For achieving UNSDGs (United Nations Sustainable Development Goals) we have to take care of Nature which sustains life and need healthy economies to lift people out of poverty. In Nature everything is connected, so is true of a healthy environment and a healthy economy.

With rapid urbanization, in cities of Srinagar and Jammu the land prices have skyrocketed due to migration of people from rural areas, thus increasing the likelihood of people losing touch with nature, the impact of our growing economic footprint threatens our own future directly.

But, in our situation, we have reliable freshwater, forests, and other natural resources are present which makes industry possible, particularly the hydro power generation.

But we need to understand that we cannot have long-term hydro power generation and other human development without a steady climate and a healthy Natural world. If we are not able to keep our water resources clean, we will suffer immensely economically.

Similarly for J&K, Tourism sector is the backbone of our economy. If we create concrete jungles at our new and virgin tourist destinations and create unsustainable infra structure we will harm our economy irreversibly. The bottom line is that when we damage the Natural world, we damage ourselves..

With the projected rise in water levels and increase in the average temperature of the planet, large chunks of land, even whole countries, will become uninhabitable, triggering mass climate induced migration that being a serious ramification of Climate change.

In our society we waste a lot. But we need to understand that waste is the enemy. Wasting food, energy, or material is a blot in the face of sustainability. Plastic and polythene which is used in our daily chores as carry bags and other such material end up as litter which is a waste and pollute our water bodies irreversibly and even have caused death of livestock.

Natural connection and economic worlds are linked and based on similar principles. In the financial world, we do not eat into capital to the point of depletion because that would bring about financial ruin.

Yet in the Natural world, we have done this repeatedly with fish stocks and forests, biodiversity, water resources, land resources to the point of decimation. Overconsumption and unsustainable production have put the planet in peril

The importance of minimising waste, taking advantage of efficiencies, and accurately reflecting costs in prices, including costs imposed on our entire shared resource, the environment.

We need to eliminate energy subsidies and other subsidies we offer for various developmental schemes and encourage green industry, green jobs, and green production leading to sustained development.

Change begins now when it comes to sustaining the vital symbiosis between the economic and the natural world. The private sector can stop supporting or subsidising industries and activities that damage the planet and instead invest in sustainable development.

Government need to roll out policies to fight climate change and the destruction of nature, for example, through promotion of clean-technology research and development.

Nature is resilient. We can still reverse some of the damage we have inflicted on our precious planet. But time is running out. If we don’t take decisive action, the damage will become irreversible.

The scientific findings suggest that climate change is associated with increasingly frequent and intense natural disasters ranging from droughts and wildfires to strong winds and flooding. The challenge for policymakers is to decide how much to spend on measures to reduce greenhouse gas emissions.

We need to strive, and technologies exist to decarbonizes our economy enough to come within striking distance of net-zero greenhouse gas emissions by 2050.

Although such a vast transformation of the energy system will be costly but there are certainly inexpensive measures that can be implemented today, including energy conservation, efficiency nudges, and the replacement of retiring fossil-fuel powered electricity generation with renewable.

The costs of these measures are already lower than the damage from climate change they would avert, based on estimates of carbon’s social cost. The changes needed to keep warming below 1.5˚C are enormous: massive reallocation of capital is needed, which presents unprecedented risks and opportunities.

Lastly, we need to treat the Natural world as we treat the economic world and protect our Natural Capital.

Disclaimer: The views and opinions expressed in this article are the personal opinions of the author.

The facts, analysis, assumptions and perspective appearing in the article do not reflect the views of GK.

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