Global Economy

Solidarity in tackling climate change is not about altruism but has hard core of self interest: Timmermans


European Commission’s Executive Vice President Frans Timmermans was on a three-day visit to India just a week ahead of the critical G-20 Leaders’ Summit in Rome and UN climate summit, COP26, in Glasgow. Timmermans, who is in-charge of the European Green Deal, participated in the fourth assembly of the International Solar Alliance, met with ministers of environment, energy.

ET’s Urmi A Goswami caught up with the European Commission’s point man for the Green Deal and spoke with him about the evolving India-EU relationship, controversial measures like the carbon border adjustment mechanism (CBAM), and the global collaboration critical to green the economy and make the tectonic shift required for countries to grow, meet human development needs, and aspirations of their populations while keeping within the planetary boundaries.

How has the India-EU relationship evolved? Where does it stand now and how it different from the others, such as the India-US relationship?

The relationship between the EU and the India is traditionally mainly based on commercial issues, trade. You can see with the Indo-Pacific strategy that the EU has presented that wished to broaden the relationship and look at many more aspects including the geopolitical. This is a tough neighbourhood and we want to be able to play a positive role in it– enhancing multilateralism, sharing the basic values we share and working on them. In the past India and EU have worked on many issues of human development, climate policy, environment policy, policy in commercial and financial areas. I think it is now time to look at it in a more comprehensive way.

That is why we have come out with this (Indo-Pacific) strategy that will help us focus our ideas on how we will take the relationship between the EU and India to the next level in a more comprehensive way. The last EU-India Summit was a testimony to that. The presence of the European Council and the Commission and Prime Minister Modi clearly indicated the wish to deepen and broaden our relationship.

How is the EU engaging India on the Green Deal particularly measures such as carbon border adjustment mechanism (CBAM) to avoid a repeat the experience with the inclusion of aviation in the emissions trading system?

We have had constant exchanges at all levels—the technical, high official and the political level. My last conversation with the previous Minister of the Environment Prakash Javadekar was in June this year. We are in constant touch. The President of the European Council and President of the European Commission are in constant touch with Prime Minister Modi. We will, as I told the ministers, “consult you, inform you and we will not surprise you”.

CBAM is about one thing only: how to avoid carbon leakage; it is not a trade measure. We will introduce CBAM in a way that it is fully in conformity with WTO rules. On top of that we will have a trial run for two years to see the effects vis-a-vis certain countries in five sectors. After that we can see if it is needed or not. In general terms I would say, if countries that take steps to decarbonise their economies, and go in the same direction as we do then the risk of leakage is either mitigated or is absent, then introduction of CBAM makes no sense.

While different countries may be moving in the same direction, their pace will be different from that of the EU. How to ensure that countries are not at a disadvantage because of their differential starting points which itself is a function of their level of development?

We address it by looking objectively at the impact on the environment. The way we can address it, is to objectivise whether there is a risk of carbon leakage or not. Carbon leakage is a real threat and that doesn’t just apply to the EU. All nations that take steps to put a price on carbon will be at risk of carbon leakage. Trade is not the issue it is environment. The way the world works is to ensure that you are not affected by the carbon leakage measures, and we have taken initiative to present it in form of CBAM, other nations might find other ways.

But I can assure you that in countries that take measures to put a price on carbon thus putting an extra burden on their industry, there will be a reaction. If industry sees a chance to not be burdened by the extra measure by producing elsewhere, they might do just that. We need to avoid that because then everybody loses and the country that imposed these measures will lose the industry and the climate does not gain anything because the same emissions will not come from somewhere else. Therefore, it is more about the direction than pace,

The direction brings us to the push for net zero. A global goal net zero goal effectively allows countries to set their own targets, this could result in overshooting the global carbon budget. At the same time, the countries are at different stages of development, making it necessary for a differentiated net zero target. How to ensure that effort to achieving the goal of net zero emissions adheres to science and equity?

All industrialised nations and big emitters, among whom I count India, would profit from a clear national commitment to net zero in the middle of the century, because that focuses your policies. If you just have a goal for the middle of the century but no policies to get you there, then it is a pie in the sky but if you only have policies but you don’t know where those policies end then you can’t plan. In that sense committing to a net zero by the middle of the century is simply good for planning purposes and for the planet obviously. That this will not be done in the same way everywhere is obvious.

Because our commitment is to leave no one behind, we have to make sure that developing nations, and there too India is a case in point, have the space to increase human development. Why should citizens of India not have the same right to well-being and good life as the citizen of The Netherlands or any other European country. There is no justification for that difference. You can’t say to people who are in developing nations, “sorry, we sort of eaten all the cake too bad for you and we can’t afford it anymore”. That is not a proposition. We must learn to live within the boundaries that the planet sets us at the same time leave room for human development on a global scale. That is the only way we can create harmonious developments that will allow everyone to reduce their emissions and switch to a non-carbon-based economy.

Such an effort will require global cooperation on technology and other areas. How does the EU visualize such co-operation, particularly as the experience with the Covid pandemic has not been reassuring?

On the issue of sharing because this is what this is all about, I am quite blunt in saying that there is not one nation that does this out of altruism. Everybody is in this because they know they are in trouble. Now all of us are in trouble. So, solidarity here is not altruism; it has a hard core of self- interest. If I am in the position of helping someone else, I have to do it because otherwise I am in trouble. That is the guiding principle we should be looking at. No nation is committing to net zero just to do another nation a favour. They are doing this because every nation understands they need it themselves as well. To get there we need finance.

The $100 billion that was promised is the starting point to show that we mean business. And we need to work very, very hard in the next days and weeks to get that target done but given the level of investment that will be needed to get us there, which will be in the trillions not billions. What public finance needs to do is unleash the enormous potential of private finance. We have just issued the first European green bonds, they were over signed I think 11 times, because the financial markets are really keen on green investment, but we need to create the right conditions. What does that mean on the global scale–investment protection, fight against corruption, joint ventures, technology sharing, stronger supply chains—these are the things we need to be working on. After my discussions with the ministers here, I see a strong willingness in India to work on these issues with the EU. This could be a good starting point for a stronger cooperation on all these elements that are essential for changing our economic structure which is something we need to do. We need to understand that this is not an incremental change, this is a paradigm change, this is tectonic, and the more we can cooperate with our global partners such as India the better it is also for the EU.

With the Glasgow climate summit, COP26, the focus will move away from negotiation to implementation. How does the European Union see its role in the changing nature of the COP?

I would like the EU play its role, as we have always done, as a honest broker and the champion of the developing world, as a champion of the smallest nation that are under threat, as the one who knows how to bridge the gap that can emerge between the most industrialized nations and the developing world. We have done it in Paris, we have been doing it since.

We work very closely with the United States, try to do our best and try to have a constructive dialogue with China. We are looking to increase our cooperation across the board with India, and we really want to look after the interests of African nations, small island states. That is traditionally our role and that is what we need to expand. We do not want to get sucked into controversies between individual nations. We want to make sure we allow others to find common ground starting from different positions.



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