In a recent international conference, RBI Deputy Governor expressed his views on climate change related risks for financial system. According to him, Climate change risks have started to impact the financial system and are envisaged to pose systemic risks in the coming future. The climate-specific vulnerabilities’ interplay with real economy and financial sector vulnerabilities can lead to financial stability risks. In this context, it is essential to build capabilities to ensure correct assessment of these risks and put in place suitable adaptation and mitigation measures. Transparency and capacity building are going to be the key differentiators and we need to collectively move in this direction. He noted that climate change was a topic of heated debate, particularly about availability of adequate climate related finance, at the recently concluded Conference of Parties (COP) 29 in Baku, Azerbaijan, which highlighted two issues— first, climate related finance still gets negotiated at international forum and second, EMDEs (Emerging Markets and Developing Economies) priorities are still not aligned with the developed nations. He underscored that though the agreement proposed to triple the climate finance for EMDEs from the previous goal of $100 billion to $300 billion annually by 2035, it fell short of EMDEs expectations.    
 

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