For India and other developing economies, the results from Belém signal a troubling continuity: The multilateral system remains adept at setting targets but chronically unable to mobilise the finance required to meet them.
Even the pledge to triple adaptation finance by 2035 rings hollow without a concrete delivery plan, effectively delaying urgent support. Crucially, India is unlikely to access a meaningful share of these limited funds, which are prioritised for smaller, fragile nations. This leaves India to shoulder the immense cost of its catastrophic climate vulnerability almost entirely from its domestic budget.
Similarly, the $250 million pledged to the Fund for responding to Loss and Damage (FRLD), while a start, is analytically insignificant when compared to the estimated need of average $395 billion per year (according to the Nature magazine). To put this in perspective, the global oil and gas industry generates approximately $2.8 billion in daily profits (according to a July 2022 Guardian article). The disparity suggests a lack of proportionality in the global response, widening the trust deficit that plagues these negotiations.
The presence of such a concentrated interest group inevitably impacts policy output. It creates an environment where the "transition away from fossil fuels" agreed upon at COP28 is diluted by narratives that distract from the necessary rapid phase-out. Analytically, this capture explains why the text remains weak on ‘supply-side’ constraints despite the International Court of Justice, in its recent Advisory Opinion, affirming that phasing out fossil fuels is a legal obligation.
In contrast, the EU pushed for a framework lacking financial mandates. However, developing countries secured a strategic victory with a decision to develop the BAM by COP31 next November. This ensures that social protection and workforce displacement are finally treated as core governance challenges rather than mere externalities.
First, the continued shortfall in public finance poses a tangible risk to India’s renewable energy ambitions. Without grant-based and low-cost capital, the transition becomes significantly more expensive, potentially slowing the pace of deployment or forcing trade-offs with other developmental priorities.
Second, the debate over "Unilateral Trade Measures", such as the Carbon Border Adjustment Mechanism, remains a critical flashpoint. India, along with the BASIC group, has rightly identified these measures as protectionist instruments that shift the burden of decarbonisation onto developing economies. Belém failed to resolve the impasse but agreed to launch a series of annual dialogues in June over the next three years—involving key bodies like the WTO and UNCTAD—to scrutinise the barriers and opportunities for enhancing international trade cooperation.
However, the most consequential development occurred outside the official UNFCCC plenary. Colombia’s declaration on transitioning away from fossil fuels, with the support of over 80 countries, and the announcement of the First International Conference for the Phase Out of Fossil Fuels in April 2026, jointly hosted by the Netherlands, marks a potential turning point in climate governance. This nudged the COP president to announce a new roadmap on the transition away from fossil fuels under his leadership, drawing lessons from the upcoming April conference.
This move signals that many countries are increasingly willing to bypass the consensus-based paralysis of the UN process to forge "coalitions of the willing" and create a path towards a new Fossil Fuel Treaty to transition in a just and equitable manner. For the global climate regime, this fragmentation is a warning: If the multilateral process cannot deliver a credible plan to phase out fossil fuels and finance the transition, leadership will inevitably migrate elsewhere. The Paris Agreement remains valid, but it clearly requires ‘retrofitting’ from the outside to achieve its goals.
Singh is Founding Director of Satat Sampada Climate Foundation. He is the Global Convenor of the Fill The Fund campaign and Strategic Advisor to the Fossil Fuel Treaty Initiative
First Published: Dec 02, 2025, 12:00
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