Nepal’s experience at COP31 shows the gap between global climate commitments and the financial support available to vulnerable countries. At Antalya, Türkiye, world leaders are discussing the shift away from fossil fuels. For countries such as Nepal, however, the question remains: who will finance the transition and who will pay the price? Without predictable and accessible grant-based climate finance, a just energy transition will be difficult to achieve. At a program titled From the Himalayas to the World: A Roadmap for a Just Transition from Fossil Fuels for Vulnerable Economies, held at the Nepal Pavilion during COP31, government officials and international speakers called for climate finance that does not add to the economic burden of developing countries. Nations that have contributed little to global emissions are being forced to spend heavily on a crisis they did little to cause. Nepal accounts for less than 0.1 percent of global greenhouse gas emissions, yet faces melting glaciers, flash floods, landslides and growing threats to agriculture, tourism, infrastructure and livelihoods. The August 26 Bhotekoshi disaster damaged 14 hydropower projects. Their reconstruction and rehabilitation are estimated to cost US4.7billion, a heavy expense for a country with limited financial resources. Nepal has pledged to achieve net-zero emissions by 2045 and generate 28,500MW of renewable energy by 2035. Its Nationally Determined Contribution estimates that US73.74 billion will be needed for emissions reduction by 2035, and 85 percent of that is expected to come from international assistance.
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Grant-based finance should be at the centre of climate cooperation. Even concessional loans add to public debt and leave governments with less money to spend on health, education, infrastructure and social protection. Countries already struggling with climate impacts should not have to borrow to rebuild what disasters have destroyed. Grants would allow them to invest in renewable energy and climate-resilient infrastructure without adding to the debt burden of future generations. Expanding hydropower and other renewable energy sources would reduce Nepal’s dependence on imported petroleum. The transition must also protect workers and communities whose livelihoods depend on existing energy systems. They need employment security, decent wages, opportunities to develop new skills and social protection. Without these provisions, low-income households and vulnerable workers could bear a disproportionate share of the costs. Nepal also suffered a setback at COP31. Nepal, Bhutan and Kyrgyzstan had sought a separate agenda item on mountains and climate change, but the proposal was excluded from the adopted agenda. The COP31 presidency instead offered consultations and research dialogues at UN climate meetings in Bonn in 2027 and 2028. For countries already facing serious climate threats, further discussions offer little certainty that concrete action will follow. Mountain regions face risks that existing climate finance and adaptation arrangements have yet to address adequately. Glaciers are retreating, glacial lake outburst floods are becoming a growing threat, and landslides and changing river systems are putting communities at risk.
The impact extends well beyond the mountains. Rivers originating in the Himalayas provide water to more than two billion people, so the region’s changing climate affects food security, energy production and water supplies across Asia. Adaptation funding should cover the costs of protecting settlements, roads, hydropower projects and water systems in difficult mountain terrain. Loss and damage mechanisms must provide accessible support when disasters destroy infrastructure and livelihoods. Mountain-specific indicators should also be included in the Global Goal on Adaptation and the New Collective Quantified Goal on Climate Finance. Nepal should continue pushing for a dedicated UNFCCC work program on mountain ecosystems. The consultations and research dialogues proposed at COP31 must lead to clear decisions, timelines and financial commitments. An annual high-level dialogue would give mountain countries a regular platform to raise their concerns and press for action. Foreign Minister Shishir Khanal urged world leaders at COP31 to turn sympathy into action. Nepal must keep that message at the centre of its climate diplomacy. For Nepal and other mountain nations, climate justice will depend on whether financial support reaches vulnerable countries before more lives, livelihoods and infrastructure are lost.
