Mobilizing Domestic Resources for Adaptation: Progress with Subnational Climate Financing Frameworks in India Stephanie allan & Shivaranjani Venkatramani PFM and climate finance experts, action on climate today, oxford policy management Bangkok, 4 march 2019

The importance of subnational budgets in financing CC It is important to also think about subnational governments, depending on their service delivery mandates & degree of fiscal autonomy Governments in the Asia- Pacific region have been particularly enthusiastic about decentralisation Municipal / intermediary / regional OECD 2016. Subnational governments around the world Structure and finance

The importance of subnational budgets in financing CC Assignment of expenditure responsibilities mean that subnational governments are often at the forefront of dealing CC impacts Subnational governments will typically operate their own budget process which will contain additional entry points where CC can be considered

Subnational budgets and climate finance: India National and State level CC policies – estimates of required finances for CC action Major reconciliation of existing development plans with CC mandate - different approaches to impacting decision making National NAPCC Sectoral Roadmaps/Flagship Initiatives State/Provincial SAPCC, Devt Budgets

Development Programmes funded through the budget Methodological Approach Development Programmes funded through the budget Economic Climate benefits Environmental Social Planned/ Intended

Climate Change Impacts Methodological Approach Relevance Contribution to resilience building/ adaptation or mitigation Programme Benefits Climate Change Impacts Sensitivity Risks to benefits due to climate change

CC Stocktaking Results Climate Relevance (potential for CC resilience building/ adaptation/ mitigation) High Low Climate Sensitivity (loss and damage due to floods/heat waves/drought/ cyclones etc.) High priority for scrutiny: Retain benefits with climate relevance Climate-proof benefits with negative sensitivity Design changes to enhance climate resilience and more climate proofing effort High priority for funding: Climate change benefits accrue with relatively less impact (or loss) from climate risks – low hanging fruits Regular monitoring and review effort

Progress at the subnational level: Reshaping Sectoral Climate Actions Re-orienting policy focus to enhance adaptation and mitigation outcomes through subnational budgets Basis for new/add-on funding through existing pipeline of programmes E.g. Assam, Kerala, Maharashtra

Progress at the subnational level: Reporting and Assessment Greater visibility to CC relevance and vulnerability of Department budgets in key budget and plan documents Critical for institutionalising the climate dimension within departmental planning cycle – sustaining the climate conversation E.g. Assam, Bihar, Odisha

Progress at the subnational level: Climate-sensitised Design of Development Actions Guiding planners to improve plan design w.r.t CC Immediate link to on-the-ground changes (enhancements) in funding of programmes with climate benefits E.g. Chhattisgarh, Odisha

Key learnings from subnational mainstreaming Challenge Response Political Ownership of mainstreaming mandate loosely defined Identification of suitable nodal point as champion (not always the mandated Department) Capacity Lack of recognition of CC issues and linkage with development programmes Analytical base on potential loss and damage – sector-wise, mapped for major (high value) programmes Operational Huge gap between policy mandates at national/state level and actual implementation guidelines w.r.t CC adaptation and mitigation Simple prioritisation schema that converts CC stocktaking of budgets into practical responses by Departments

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