Analysis finds multi-trillion-dollar climate financing gap in crucial Hindu Kush Himalaya region
A new report has identified a stark disparity in climate vulnerability and financial capacity; and countries highly exposed to climate effects, including Bangladesh, Bhutan, India, Myanmar, Nepal and Pakistan are the least equipped to manage these risks. Report UNB
The report, ’Climate Finance Synthesis Report: Needs, Flow and Gaps in the Hindu Kush Himalaya Countries’, was launched at the ‘Enhancing Climate Actions in the Hindu Kush Himalaya’ conference held in Paro, Bhutan on Monday.
Afghanistan and Bangladesh face significant challenges, with the lowest readiness scores (0.214 and 0.207) and higher vulnerability (0.586 and 0.554).
India, Nepal, Myanmar and Pakistan show moderate levels of readiness and vulnerability, reflecting a mix of capacities and risks across the region.
This data underscores the urgent need for targeted interventions to enhance resilience in the most vulnerable countries, the report reads.
The Hindu Kush Himalaya (HKH), a vital water source for billions in the region, faces a staggering climate financing shortfall, according to the new regional analysis.
The report finds current financial commitments are insufficient to address the region’s adaptation and mitigation needs, projecting a required total of USD 12.05 trillion by 2050.
“Mobilising the ambitious target of USD 12 trillion is like climbing the Everest of funding,” said Ghulam Ali, Innovative Investment Specialist and lead author of the report. “The strategy to mobilise these resources has to be creative, comprehensive, and collective to achieve such significant goals.”
The analysis, conducted by the International Centre for Integrated Mountain Development (ICIMOD), concludes that the annual climate finance requirement for the eight HKH countries is approximately USD 768.68 billion. China and India account for 92.4% of the total projected need.
“Evidence and analysis are an important part of advocating and influencing policy development for climate financing in the region,” said Pema Gyamtsho, Director General of ICIMOD.
He said the grounded data this report offers enhances understanding of the actions required to address the financial needs of our region to build economic resilience.
The HKH region faces an adaptation burden far exceeding global averages, forcing nations like Afghanistan, Nepal, and Pakistan to spend significantly more than income-group averages on disasters and adaptation, trapping them in a cycle of repair with limited funds for other needs.
The crisis is framed as an economic equality issue. The annual per capita climate finance needs ranges from as low as USD 24 in some countries to over USD 2,126 in others, representing 6% of GDP to a crippling 57%, respectively.
This places immense pressure on policymakers who are facing trade-offs between development and survival for vulnerable populations.
To bridge the funding gap, the report recommends a three-track approach: improve access to existing multilateral funds, pioneer innovative mechanisms like debt-for-climate swaps and increase public spending for mountains and environmentally sensitive areas.?
The Hindu Kush Himalaya (HKH) region stretches 3,500km across Asia, spanning eight countries – Afghanistan, Bangladesh, Bhutan, China, India, Myanmar, Nepal and Pakistan.
Total Climate Finance needed for Hindu Kush Himalaya (HKH) region stands at $12 trillion with $768.68 billion/year including both adaptation (2020-2050) and mitigation (2020-2030).
China and India dominate total needs ($8.46T and $2.69T, respectively). China and India, together constitute 92.41% of the total needs.
The remaining HKH countries, excluding China and India, still require a total of 62.16 billion per year and 0.17 billion per day. Bangladesh and Pakistan require significant adaptation funding ($86B and $280B).
