Fund for Responding to Loss and Damage (FRLD)

Why in News?

Nepal has approached the Fund for Responding to Loss and Damage (FRLD) seeking expedited financial assistance for relief, rehabilitation and reconstruction following the recent ice-rock avalanche disaster in Rasuwa district and along the Bhote Koshi River.

Nepal estimates that around $4–5 billion may be required for post-disaster reconstruction. The development has also revived the debate over climate justice, historical responsibility and the distinction between climate finance and compensation.

Key Issues

• Nepal has argued for a shift from “aid” to “climate justice”, highlighting the disproportionate burden borne by vulnerable developing countries.
• The debate focuses on the principle that countries with greater historical and current contributions to greenhouse-gas emissions should bear greater responsibility.
• Developed countries have the principal obligation to provide climate finance under the UN climate framework.
• China is the largest current annual emitter, while the US has a very large historical cumulative and per-capita emissions burden.
• India is among the major current emitters, but its historical cumulative and per-capita emissions remain much lower than those of many developed countries.

What is FRLD?

• The Fund for Responding to Loss and Damage (FRLD) is an operating entity under the financial mechanism of the UNFCCC.
• It was established by the COP and CMA to assist developing countries that are particularly vulnerable to the adverse effects of climate change.
• Its mandate covers economic loss and damage, non-economic loss and damage, damage associated with extreme weather events, damage from slow-onset climate events

Evolution of the Loss and Damage Fund

Event	Development
COP27, 2022 – Sharm el-Sheikh, Egypt	Agreement reached to establish a dedicated Loss and Damage Fund
COP28, 2023 – Dubai, UAE	Fund was operationalized as the Fund for Responding to Loss and Damage (FRLD)
2023	26-member Board constituted
2024	Philippines selected as host of the Board
2024	World Bank selected to host the Secretariat and serve as Trustee, subject to the agreed arrangements
COP28	Developed countries announced early voluntary contributions exceeding $420 million

How does the FRLD provide support?

• The Fund can provide financial support through grants, concessional financing, other financial arrangements and innovative financing mechanisms.
• Its resources can be mobilised through government contributions, private-sector partnerships and innovative financing mechanisms.

CLICK HERE: UPSC PRELIMS & MAINS CURRENT AFFAIRS BASED WEEKLY TEST (ENG & HINDI)

CLICK HERE FOR GS TIMES PRAHAR UPSC GS MAINS TEST SERIES 

CLICK HERE: DAILY CURRENT AFFAIRS QUIZ (FOR ALL EXAMINATIONS)