Context

• Recently, SIDBI gets $24.5 million from Green Climate Fund for its Avaana Sustainability Fund.

About Green Climate Fund

• Formation: The Green Climate Fund (GCF) was formed under the United Nations Framework Convention on Climate Change. 
  • It works as a Financial Mechanism entity, focusing on developing nations’ efforts to adapt to and mitigate the effects of climate change.
• Headquarters: Incheon, South Korea. 
• Purpose: To help developing countries reduce greenhouse gas emissions and strengthen their capacity to respond to climate change.
• Target Countries: The GCF primarily assists developing nations most susceptible to climate change, such as Least Developed nations (LDCs), Small Island Developing States (SIDS), and African States.
• Loss and Damages Fund: At COP27, UN delegates agreed to establish a ‘Loss and Damages‘ fund for compensating vulnerable countries affected by climate-related disasters. 
  • The fund was officially approved at the COP28 Summit in 2023.

Investment Areas of The Green Climate Fund:

• Built Environment: The built environment comprises green buildings, sustainable cities, and climate-resilient infrastructure.
• Energy and Industry: This includes encouraging renewable energy, energy efficiency, and clean technologies across multiple sectors.
• Human Security, Livelihoods, and Wellbeing: This category includes programmes addressing climate change’s effects on food security, water resources, health, and displacement.
• Land-Use, Forests, and Ecosystems: This programme focuses on forest conservation, sustainable land management, and nature-based climate change solutions.

News Source: Financial Express