The Loss and Damage Fund (LDF) is a global financial mechanism established to assist developing nations suffering from the adverse effects of climate change. These impacts often exceed their capacity to adapt or prevent, encompassing both sudden catastrophes, like floods and cyclones, and gradual changes, such as rising sea levels and desertification.
The term loss pertains to irrevocable losses, such as lives or biodiversity, while damage refers to repairable aspects, like infrastructure. The fund aims to aid communities in rebuilding, relocating, or recovering from the aftermath of such events.
The fund was established during the COP27 conference in Egypt in 2022 and was operationalized at COP28 in Dubai in 2023.
Initially, $700 million was pledged to the fund. However, this amount is significantly below the estimated financial needs of affected countries. Future commitments are anticipated to increase this funding.
The fund is governed by a dedicated board, with the World Bank currently acting as the interim trustee.
The fund provides various forms of support, including:
India plays a crucial role in the LDF due to its high vulnerability to climate impacts, including coastal floods, heatwaves, droughts, and glacier melt. It has been a long-time advocate for climate justice and stands to benefit significantly from the fund, especially given the rising economic and human toll from climate-related disasters, such as the ₹300 crore damage from the Himachal Pradesh floods in 2024.
India has recently faced significant loss and damage, including:
India supports the polluter pays principle, asserting that developed nations, which have historically contributed more to greenhouse gas emissions, should shoulder the financial responsibility. Furthermore, India calls for the fulfillment of the $100 billion climate finance pledge made by developed countries.
Q1. What is the Loss and Damage Fund (LDF)?
Answer: The LDF is a global financial mechanism created to support developing countries facing climate change impacts that exceed their capacity to adapt or prevent.
Q2. Why is it called "loss and damage"?
Answer: "Loss" refers to irretrievable losses like lives, while "damage" pertains to repairable aspects like infrastructure, aiding communities in recovery.
Q3. How is it different from adaptation or mitigation funding?
Answer: Mitigation reduces emissions, adaptation minimizes vulnerability, while loss and damage funding addresses situations where these measures fail.
Q4. When and where was this fund created?
Answer: The fund was established at COP27 in Egypt in 2022 and became operational at COP28 in Dubai in 2023.
Q5. Who manages the fund?
Answer: The fund is overseen by a Governing Board, with the World Bank currently serving as the interim trustee.
Question 1: What does the Loss and Damage Fund aim to address?
A) Financial compensation for developed countries
B) Supporting communities affected by climate change
C) Funding for renewable energy projects
D) Infrastructure development in urban areas
Correct Answer: B
Question 2: Where was the Loss and Damage Fund established?
A) COP25 in Paris
B) COP26 in Glasgow
C) COP27 in Egypt
D) COP28 in Dubai
Correct Answer: C
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