a day ago
- Business
- New Indian Express
Climate adaptation investments yielding 10-fold returns
CHENNAI: As climate hazards like floods and wildfires intensify and global financial resources tighten, a latest study by the World Resources Institute (WRI) provides evidence that climate adaptation investments generate value. A first-of-its-kind Adaptation Triple Dividend of Resilience (AdapTDR) database analyses 320 projects across 12 countries from 2006 to 2024, with a purse of USD 133 billion, finding that each dollar invested yields 10.4 dollars in benefits over 10 years, with total returns exceeding USD 1.4 trillion and an average economic internal rate of return (EIRR) of 27 per cent.
India, with 39 projects averaging USD 588.28 million each, contributes significantly to this dataset, demonstrating returns in agriculture, water, and infrastructure sectors.
The study's methodology evaluated projects approved by multilateral development banks (MDBs) and other development finance institutions (DFIs), focusing on agriculture, health, infrastructure, and water. Data collection sourced public project appraisal documents (PADs) from the World Bank, Asian Development Bank (ADB), and Green Climate Fund.
The AdapTDR database captures objectives, costs, benefits, net present values (NPVs), and EIRRs, using cost-benefit analysis (CBA) and the triple dividend framework, which measures avoided losses, induced economic benefits, and social-environmental benefits. The sample includes 12 countries — Bangladesh, Brazil, China, Colombia, Ethiopia, Ghana, India, Kenya, Senegal, South Africa, Uzbekistan, and Vietnam — representing 48 pc of the global population.
In India, the Odisha Integrated Irrigation Project for Climate Resilient Agriculture, costing USD 235.54 million, with benefits expected to spread over 26 years operates over 26 years, enhancing agricultural intensification and diversification. Its economic net present value (ENPV) ranges from USD 132 million to USD 241 million, with an EIRR of between 10.8 pc and 14.2 pc. The project reaches 72 pc of beneficiaries through improved water management and climate-smart practices, reducing greenhouse gas (GHG) emissions, as per the World Bank.
