Statement of Commitment to Support Greening India’s Financial System (NGFS) Report – RBI
Recently the Reserve Bank of India has published a statement on its commitment to support NGFS for the greening of India’s financial system.
Supporting the Network for Greening the Financial System (NGFS), Glasgow Declaration, the Reserve Bank of India (RBI) has committed to support the greening of India’s financial system through the following:
- Explore the use of climate scenario exercises to identify vulnerabilities such as gaps in balance sheets, business patterns and climate-related financial risks of entities supervised by RBI.
- Integrating climate related risks into financial stability monitoring and creating climate risk awareness among regulated financial institutions.
- In addition, to disseminate knowledge on climate change issues and ways to deal with them.
- It is a group of central banks and observers launched at the “One Planet Summit” held in Paris in the year 2017. These are specialized banks that aspire to contribute to the development of environmental and climate risk management in the financial sector on a voluntary basis.
- It brings together 91 central banks and supervisors and 14 supervisors. These represent all five continents and the countries responsible for about 85% of global greenhouse gas emissions.
- RBI joined it in April 2021. This has resulted in the RBI helping to learn from and contribute to global efforts on green finance.
About Green Finance:
- It refers to structured financial activity. This includes products or services that are designed to ensure better environmental outcomes.
- This includes financing of public policies, public and private green investments, etc. In addition, sustainable development priorities include increasing the flow of investment or adapting to the aspects of climate change.
Source – The Hindu