Loss and Damage Fund (LDF)

The Loss and Damage Fund is a financial mechanism established to help developing countries cope with the adverse impacts of climate change. It was created as part of international climate negotiations, specifically under the United Nations Framework Convention on Climate Change (UNFCCC), to provide compensation for losses and damages caused by climate-related disasters such as floods, storms, sea-level rise, and other extreme events.

The fund aims to address the consequences that are beyond the capacity of countries to adapt to, especially in vulnerable nations that contribute the least to global emissions but are disproportionately affected by climate change. The Loss and Damage Fund became a key outcome of the COP27 climate conference in 2022, where developed countries agreed to contribute financial resources to support this effort.

This fund acknowledges that even with mitigation and adaptation efforts, certain damages from climate change are inevitable and need to be addressed through financial aid.

More Information

India has played a significant role in advocating for the establishment of the Loss and Damage Fund to address the impacts of climate change on vulnerable nations. As a developing country and a key player in global climate negotiations, India has consistently highlighted the need for a fair and equitable approach to climate finance, with an emphasis on the principle of "common but differentiated responsibilities" (CBDR). This principle underscores that while all countries must act on climate change, developed nations, which have historically contributed the most to global emissions, should take greater responsibility in financing climate-related losses and damages.

Key aspects of India's role in the Loss and Damage Fund:

• Advocacy for Climate Justice: India has been vocal about the importance of climate justice, emphasizing that developing countries, which are the least responsible for global warming, should not bear the brunt of its impacts. India has consistently pushed for financial assistance to help vulnerable countries cope with irreversible losses from climate disasters.

• Supporting the Vulnerable: Although India itself faces significant climate risks, it has also supported the cause of smaller, more vulnerable nations, such as small island developing states (SIDS) and least developed countries (LDCs), that are at the frontline of climate change impacts. At COP27, India aligned with other developing nations in advocating for the creation of a Loss and Damage Fund to address the needs of these countries.

• Balanced Approach: While supporting the Loss and Damage Fund, India has also stressed the need for a balanced approach in climate negotiations, which should not detract from the importance of mitigation and adaptation efforts. India emphasizes that the Loss and Damage mechanism should complement, rather than replace, efforts to reduce emissions and invest in adaptation strategies.

• Focus on Implementation: After the Loss and Damage Fund was agreed upon at COP27 in 2022, India has continued to focus on the implementation phase. India calls for transparency and clarity in how the fund will be structured, governed, and financed, with a clear distinction