Citizen Groups Urge 16th Finance Commission to Prioritize Climate Adaptation #IndiaFinance

New Delhi, February 18, 2025: In response to the sixteenth Finance Commission, headed by Arvind Panagariya, inviting public suggestions on its mandate set for it by the Central Government, a coalition of 12 citizen groups, led by Greenpeace India, has urged the commission to prioritize climate adaptation in India’s financial policies, focusing on climate impacted communities. The commission, constituted in December of last year, is expected to submit its recommendations by October 2025, which will be valid for five years starting April 1, 2026.  These recommendations from the coalition, agreed upon through multiple stakeholder consultations, represent a comprehensive civil society input at this crucial time.

The groups sounded an urgent alarm about the escalating climate crisis, revealing that extreme weather events claimed 3,238 lives in the first nine months of 2024 alone—an alarming 18% increase compared to 2022. Data from previous years (2015–2022) also highlights a consistent rise in climate-related human and economic losses, reinforcing the urgent need for climate adaptation. Heat-related productivity losses alone could slash India’s GDP by up to 4.5% by 2030while inadequate adaptation measures over the years have compounded economic vulnerability.

Beyond the direct loss of lives and economic damage, the crisis has also led to missed opportunities for climate-sensitive communities. Many who depend on agriculture, fisheries, and informal labor could have experienced greater economic security and resilience if proactive adaptation investments had been made earlier. The lack of preparedness has not only intensified the immediate impact of extreme weather events but has also limited the long-term livelihood potential of millions, highlighting the need for urgent, forward-looking climate action.

Ahead of the union budget, India’s Economic Survey(IES) for 2024-25 points out a growing problem: we’re not spending enough to adapt to climate change.  Although spending on adaptation has increased from 3.7% of our GDP in the 2015-16 financial year to 5.6% in 2021-22, it’s still not enough.  India is the seventh most vulnerable country to the effects of climate change, this poses a significant risk.The survey emphasized that effective adaptation strategies require a multi-faceted approach, including policy initiatives, sector-specific strategies, resilient infrastructure, research and development, and securing financial resources. These measures should also be tailored to India’s diverse geographic and agro-climatic conditions.

“Despite the IES recommendation, the 2025 Budget doesn’t include specific funding for adaptation.  While we appreciate the focus on reducing emissions (mitigation),the urgency of need for climate adaptation cannot be ignored.  This lack of budgetary support for adaptation puts climate impacted communities at a much higher risk, threatening lives, livelihoods, and the economy”, says Selomi Garnaik, Climate Justice Campaigner, Greenpeace India, who led the stakeholder consultations.

Key Recommendations:

The coalition’s demands include

1. The 16th Finance Commission must urge the National Disaster Management Authority (NDMA) to officially recognize heatwaves as a national disaster.
2. Establish a Dedicated Climate Adaptation and Resilience Fund for Marginalized and Vulnerable Communities:
3. Devolve funds to state governments for managing extreme weather events, with allocations based on updated epistemological evidence such as the Climate Vulnerability Mapping Atlas.
4. Recommend the Center to create provision for Climate Damage Tax (CDT),in order to hold the big polluters accountable.
5. India should adopt a national framework aligned with loss and damage principle and provide Adequate compensation for losses and damages due to climate change should be provided to impacted states, with special focus on marginalized and impacted communities.

A Call for Climate Justice

The coalition emphasized that these recommendations are not just policy changes but steps toward achieving climate justice for the most vulnerable populations. They urged the Finance Commission to take immediate action to build a sustainable and equitable future.

The recommendations letter  is prepared by diverse coalition of 12 citizen groups, led by Greenpeace including Poovulagin Nanbargal, RIGHTS, Basti Suraksha Manch, VAN Gujjar Tribal Yuva Sangathan Uttarakhand, Justice in Mining Network, Mukti, Youth For Climate India, Heatwave Action Coalition India, Janpahal, HeatWatch, People for Himalayan Development, and Telangana Gig and Platform Workers Union. Together, they represent a wide range of stakeholders committed to advancing climate resilience and justice.

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