Financing Climate Change Adaptation: A Critical Review

K. S. Kavi Kumar () and R. Soundarya ()
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K. S. Kavi Kumar: Madras School of Economics
R. Soundarya: AB InBev GCC Services India

A chapter in India's Public Finance and Policy Challenges in the 2020s, 2025, pp 381-397 from Springer

Abstract: Abstract This paper explores the following issues in the context of climate change adaptation in developing countries: (i) How adaptation is characterized in climate change impact studies, and how costs associated with climate change adaptation are assessed? (ii) How do the adaptation costs, and adaptation needs (as expressed by sovereign nations in their NDCs and NAPs) compare with the international adaptation finance flows? Acknowledging the wide gap between adaptation finance flows and adaptation costs/needs, the paper argues that climate change adaptation costs largely account only for the structural adjustments and overlap with adaptation deficit (to prevailing weather/climate variability) and development deficit. The adaptation needs on the other hand reflect the combination of the region’s economic status, climate change vulnerability, and climate awareness. The paper further explores the notion of adaptation gap by critically examining the trend in budgetary allocation across different activities of sustainable agriculture sector in one state (Tamil Nadu) in India, and comparing with anticipated/desired investments. The findings suggest that there is a need for consistent allocation and spending towards various climate-proofing and climate-resilience-building activities for a more accurate assessment of adaptation gap.

Keywords: Climate change; Adaptation costs; Adaptation needs; Adaptation finance; Vulnerability (search for similar items in EconPapers)
JEL-codes: O23 Q54 Q58 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:spr:isbchp:978-981-96-2860-5_21

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DOI: 10.1007/978-981-96-2860-5_21

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