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Climate finance gaps threaten India's response to rising heat risks

By Bharat Dogra 
On a particularly hot afternoon recently, I learned that workers would be coming to carry out repairs on a community centre building in Mohali. I immediately worried about how intolerably hot the roof of the building must be, given the extreme temperatures. As I watched from a high-rise apartment, three workers appeared on the roof and tried to begin their work. After some time, however, they left in sheer frustration, unable to continue in the scorching heat that had made the roof unbearably hot.
Not everyone, however, has the option of postponing work to another day. About an hour later, as I passed several construction sites, I saw workers continuing their tasks on high-rise buildings under construction, probably bound by longer-term contractual obligations.
Earlier interviews with construction workers gathered at labour chowks in Delhi in search of daily-wage employment revealed the stress they faced from working in extreme heat. Equally acute was their anxiety about earning enough to meet the basic needs of their families.
In villages, I have recently interacted with many small farmers who have adopted natural farming or are trying to do so. Their efforts represent a courageous struggle to reduce the burden of fossil-fuel-dependent agriculture. Yet they are receiving little support from international climate finance mechanisms. If such support were available, many more farmers would be encouraged to adopt natural farming, and those already doing so would find their efforts considerably easier.
Whether in the context of small farmers in villages or workers in cities, much more needs to be done for climate adaptation and mitigation. A major obstacle remains the inadequacy of climate finance. Rich countries initially made encouraging commitments, but these promises have not been matched by adequate support. Even the limited funds that have become available often come in the form of loans rather than grants, thereby increasing the debt burden of poorer countries. Given the historical realities of climate responsibility, international climate finance should be provided primarily as grants rather than loans.
More recently, climate denialism associated with the Trump administration has further reduced the prospects for adequate international climate finance. One of the world's potentially largest contributors has questioned not only the scale of climate action but even the need for climate finance itself.
In addition to improving international climate finance, there is also a need to strengthen domestic financing mechanisms, particularly in major developing countries such as India.
As heatwaves intensify across India, a new report, Standing the Heat: An Analysis of Heat Wave Financing in India's Union Budget, has revealed that only around 10 per cent of the ₹8.57 lakh crore tracked across 130 government schemes has the potential to directly address heat-related risks and impacts.
The report, jointly produced by Greenpeace India, the Centre for Budget and Governance Accountability (CBGA), and BARC Trust, analyses seven years of Union Budget data to assess how public finance is, and is not, being directed towards India's growing heat-related risks.
According to the report, across FY 2020–21 to FY 2026–27, only 27 of the 130 tracked schemes could be considered directly relevant to heat-related risks and impacts. These schemes address vulnerabilities through labour protection, health services, crop insurance, and social protection measures. Several of them, however, have received little or no funding over multiple years.
The report notes that heatwave response in India is currently fragmented across the Ministries of Labour, Health, Agriculture, Rural Development, and Urban Development, without a coordinated national framework. There is also no standalone disaster classification for heatwaves that would unlock dedicated state-level funding. At present, only 11 states formally recognize heatwaves as a state-specific disaster.
The report further finds that the Ministry of Health has no dedicated scheme for heat emergency preparedness or mitigation. Similarly, the Ministry of Environment, Forests and Climate Change (MoEFCC), India's nodal climate body, has no dedicated heat-targeted schemes. All eight of its heat-relevant schemes contribute only indirectly through broader environmental and adaptation programmes.
"While tracing the demands and budget allocations, it appears that heat is everyone's problem but no one's priority," said Raman VR, Executive Director of the Centre for Budget and Governance Accountability. "Most budget allocations are indirect and spread so thinly across ministries that holding anyone accountable for heat-related actions becomes nearly impossible. This situation requires critical changes."
During the launch of the report, community members maintaining the Heat Registry—a first-of-its-kind community-led handwritten initiative documenting heat-related impacts—shared how extreme heat is reshaping their daily lives, work, health, and well-being.
"We can't escape heat anymore. The heat has changed how we work, travel, rest, sleep, and interact with each other. The government must act to protect our work and health," said Mohit Valecha, one of the people maintaining the Heat Registry.
Aakiz Farooq, Campaigner at Greenpeace India, said, "Today's heat is largely driven by historical and ongoing emissions from major fossil-fuel producers and high-emitting economies. Governments must urgently explore the full potential of existing public finance to address extreme heat and apply the polluter-pays principle to ensure that major emitters are held accountable for the climate and heat impacts they are driving."
Nesar Ahmad, Director of Budget Analysis and Research Centre Trust, stated, "Heatwaves must be designated as a nationally notified disaster, as recommended by the 16th Finance Commission. There is an urgent need for a scheme specifically addressing the heat crisis, which is becoming more deadly every year. Local bodies must also be given greater autonomy to tackle heat and other disasters effectively."
He added, "The glaring gap between allocations and actual expenditure under heat-related schemes, both direct and indirect, during 2024–25 is a cause for concern and highlights serious implementation bottlenecks."
The report calls on the government to formally classify heatwaves as a national disaster under the Disaster Management Act, in line with the recommendation of the 16th Finance Commission. Such a move would unlock dedicated funding through the National and State Disaster Response Funds. It also urges the creation of a cross-ministerial governance framework with clear responsibilities, dedicated allocations, and accountability mechanisms across the 16 departments currently involved in heat-related action.
The report further recommends strengthening social protection for informal and outdoor workers through heat-risk insurance and compensation for income loss, empowering local bodies to deploy funds under Heat Action Plans without bureaucratic delays, and investing in community cooling infrastructure such as shaded rest areas, cooling centres, and drinking water stations in heat-vulnerable neighbourhoods. It also advocates progressive environmental taxation on major corporate polluters to generate resources for long-term heat resilience.
Among the report's other significant findings is that the Ministry of Labour and Employment's existing schemes offer considerable potential to strengthen worker resilience to extreme heat, yet the absence of dedicated heat protection measures and targeted funding leaves major gaps in safeguarding heat-exposed workers. DAY-NULM, the only scheme specifically supporting urban informal workers, including street vendors, waste pickers, and the homeless, has effectively been discontinued, with allocations falling from ₹816 crore in 2020–21 to zero by 2025–26.
The Ministry of Science and Technology received no allocation for its heat-relevant schemes from 2025–26 onward, undermining heat research and innovation in early warning systems. The Ministry of Health continues to lack any dedicated scheme for heat emergency preparedness or mitigation. In addition, the Health Ministry's disaster preparedness scheme was allocated ₹94 crore in 2024–25, but only ₹14.92 crore was actually spent, representing a utilization rate of just 15.9 per cent.
The report also emphasizes the need for India to adopt a gender-responsive approach to heat financing, with dedicated budget provisions explicitly addressing the needs of women and other gender-vulnerable groups in adaptation, social protection, water access, and livelihood support.
Several of the report's recommendations deserve immediate attention. More broadly, far greater emphasis must be placed on the urgent task of improving both international and domestic climate finance. Without adequate financial support, efforts to protect vulnerable workers, farmers, and communities from the growing impacts of climate change will remain severely constrained.
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Bharat Dogra is Honorary Convener of the Campaign to Save Earth Now. His recent books include Protecting Earth for Children and Planet in Peril. His website is bharatdogra.in

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