Mainstreaming financial mechanisms for climate action plan in Himachal Pradesh– using integrated assessment of public finance method
Student name: Mr Prantik Mitra
Guide: Dr Vinay Shankar Prasad Sinha
Year of completion: 2018
Host Organisation: Thinkthrough Consulting Private Limited, New Delhi
Supervisor (Host Organisation): Mr Prateek Sengupta
Abstract: The imminent threat of climate change is being recognised across all political regimes. While the developed economies are more adept to tackling this challenges, the developing nations are the ones who lack the financial capability and institutional framework to increase their adaptive capacity. With this in view, the CPEIR framework was developed to assist countries in assessing their own policy, governance, institutional and financial structures to adjust to the need of attributing their economic development with climate change actions and strategies. Most countries, however, lack a comprehensively structured budget that can be attributed to the actions prescribed in the CPEIR framework. This study seeks to study the gaps in budget for the state of Himachal Pradesh using a customised methodology called ‘Integrated Assessment of Public Finance’ for the State Budget, which has been developed to tag ‘climate relevant expenditures to the Appropriation Accounts and Annual Financial Statements. The findings thus reveal the performance and preparedness of the state against the odds of any climate threats as identified by the three indices uniquely formulated for this study. The CPEIR weighted Climate expenditure is only 15% of the Total Climate Relevant Expenditure for the state. Himachal Pradesh is well prepared to tackle the challenges of climate change as indicated by PIRI scores of 0.636 (2014-15) and 1.162 (2015-16). Results of the study reveal that in few sectors of the state have high performance score and is spending excess to what has been estimated in the SAPCC namely the Renewable Energy and Energy Efficiency sector has the highest EEI score of almost 5.0 whereas Industry is the least efficient sector with a score of -1.4 on the EEI. CRE scores of -3.3068 and -3.3742 for 2014 and 2015 respectively reveal that the state spending on climate change actions is more than what the SAPCC accredit the state for. However, there are certain priority sectors, like Climate Change Knowledge Management, where the state should invest to further align its targets to the National Missions. This study has therefore tried to identify potential climate change action projects for this purpose and have tried to suggest investment models for the same.
Keyword: SAPCC, Integrated Assessment of Public Finance, NCRE, Appropriation Account and CRE index.
