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Sustainable Development and Climate Change  229

             increased by 79.4 million tonnes as compared to the last assessment of 2019. According to
             the Central Electricity Authority, as on 31st December 2021, the share of non-fossil sources in
             installed capacity of electricity generation was 40.20 per cent.

             6.58  The Hon’ble Prime Minister of India, as a part of the national statement delivered at the
             26th Conference of the Parties (COP 26) in Glasgow in November 2021, announced ambitious
             targets to be achieved by 2030 to enable further reduction in emissions.

             6.59  In order to coordinate India’s response on climate change, an institutional framework of a
             high-level inter-ministerial Apex Committee for the Implementation of Paris Agreement (AIPA)
             has been created.  The Committee  reflects India’s whole-of-government approach towards
             climate action. The purpose of AIPA is to generate a coordinated response on climate change
             and ensure that India is on track towards meeting its obligations under the Paris Agreement. Year
             2021 marks the beginning of the implementation phase of the Paris Agreement and constitution
             of  AIPA is central  to  strengthening the  institutional  arrangements  for implementation  and
             monitoring of climate actions.


             Dealing with Financial Risks associated with Climate Change

             6.60  Climate change-related financial risks pose both micro and macro prudential concerns.
             In May 2021, the Reserve Bank of India (RBI) set up a new unit–‘Sustainable Finance Group’
             (SFG) within its Department of Regulation to effectively counter these risks, and for leading
             the regulatory initiatives in the areas of sustainable finance and climate risk. The SFG is co-
             ordinating with, and participating in issues relating to sustainable finance or climate risk, with
             the international  standard setting / co-operation bodies, other central  banks, other financial
             sector regulators and the Government of India.  The group would also be instrumental  in
             suggesting strategies and evolving a regulatory framework, including appropriate climate-
             related disclosures, which could be prescribed for banks and other regulated entities to propagate
             sustainable practices and mitigate climate-related risks in the Indian context.

             6.61  To assess the progress of its regulated entities in managing climate risk, RBI is preparing
             a consultative discussion paper covering, inter  alia,  (i) governance,  (ii) strategy, (iii)  risk
             management,  and (iv) disclosure.  The discussion paper will sensitize  regulated  entities  to
             incorporate climate-related and environmental risks in their business strategies, governance and
             risk management frameworks. In line with the international best practices, banks will be guided
             to adopt a forward-looking, comprehensive, and strategic approach to climate-related risks.

             Augmenting Finance for Sustainable Development
             6.62  In January 2021, a Task Force on Sustainable Finance has been set up by the Department
             of Economic Affairs, Ministry of Finance, Government of India. The Terms of Reference of the
             Task Force include defining the framework for sustainable finance in India, establishing the
             pillars for a sustainable finance roadmap, suggesting draft taxonomy of sustainable activities
             and a framework of risk assessment by the financial sector.
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