🌱 JAIIB · IE & IFS · Module A · Chapter 10
Climate Change & SDGs
17 SDGs, 169 targets, 2016-2030 timeframe. India pledged net-zero by 2070. Climate change could lower India’s GDP by 2.8% per year by 2050. Banks are now frontline actors in the climate transition — through green finance.
⏱ 14 min read🎯 High Exam Weightage🌿 SDGs + Panchamrit + CSR⚡ Flash Cards Inside
Sections 1-3 — Overview: Climate Change, SDGs and Banking
Why climate and sustainability matter for every banker
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Sir, climate change is a science topic — why is it in JAIIB?
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Because banks are now required to manage climate risk! RBI has a Sustainable Finance Group. Banks must assess climate-related risks in their loan portfolios. Green finance — loans to solar farms, wind energy, green buildings — is now a priority sector. India’s SDG targets drive government spending, which drives bank credit. Section 135 of Companies Act 2013 mandates CSR — another banking product. Climate change could lower India’s GDP by 2.8% per year by 2050 — which means more loan defaults. Banks are central to the climate solution.
Section 4 — Key Concepts
SDGs, Climate Action, India’s commitments and CSR — all from the textbook
17 Sustainable Development Goals (SDGs)
Announced by United Nations General Assembly in September 2015. Time frame: 2016-2030. Total: 17 Goals + 169 Targets. Proposed at Rio+20 (June 2012). Superseded Millennium Development Goals (MDGs).
1. No Poverty
2. Zero Hunger
3. Good Health & Well-being
4. Quality Education
5. Gender Equality
6. Clean Water & Sanitation
7. Affordable & Clean Energy
8. Decent Work & Economic Growth
9. Industry, Innovation & Infrastructure
10. Reduced Inequality
11. Sustainable Cities & Communities
12. Responsible Consumption & Production
13. Climate Action ⭐
14. Life Below Water
15. Life on Land
16. Peace, Justice & Strong Institutions
17. Partnerships to Achieve the Goals
India’s “Panchamrit” — Five Climate Commitments (COP26, Glasgow, November 2021)
Five Panchamrit Commitments
- (i) Net zero emissions by 2070
- (ii) 500 Giga Watt non-fossil energy capacity by 2030
- (iii) 50% of energy requirements from renewable sources by 2030
- (iv) Reduce total projected carbon emissions by one billion tonnes from now to 2030
- (v) Reduce carbon intensity of economy by less than 45% by 2030
- India also announced ‘One Sun, One World, One Grid’ (OSOWOG) at COP26
- ‘Plastic Hackathon 2021’ — India free of single-use plastic by 2022
India’s SDG Progress
- India’s SDG score: 60 (2019) → 66 (2021)
- Improvements led by: clean water & sanitation + affordable & clean energy
- Kerala ranked first on SDG India Index
- Followed by: Himachal Pradesh, Tamil Nadu, Andhra Pradesh, Goa
- SDG coordination entrusted to NITI Aayog
- Flagship programmes aligned to SDGs: Swachh Bharat, Make in India, Skill India, Digital India
- Climate change could lower India’s GDP by 2.8% per year by 2050 (World Bank)
CSR — Companies Act 2013
- Section 135 of Companies Act 2013 provides legal support for CSR in India
- Schedule VII provides overall direction for CSR efforts
- Companies must spend 2% of net profits on CSR
- Companies can spend more than 2%; excess can be set off against future CSR obligations
- Non-compliance: civil wrong (not criminal) since 2020 amendment
- Penalty: at least Rs. 1 crore for defaulting company
- Penalty for defaulting officer: at least Rs. 2 lakhs
- 2019 amendment introduced imprisonment (max 3 years); 2020 amendment replaced with penalty regime
Green Finance in Banking
- RBI included small renewable energy sector in PSL scheme in 2015
- Under PSL: renewable energy firms eligible for loans up to ₹30 crore (increased from ₹15 crore since September 4, 2020)
- Households eligible for loans up to ₹10 lakh for renewable energy
- India started issuing green bonds since 2015
- Outstanding green bonds in India (Feb 12, 2020): US$16.3 billion
- Green bonds issued since Jan 1, 2018: ~US$8 billion = 0.7% of all bonds issued
- Bank credit to non-conventional energy: 7.9% of power sector credit (March 2020)
- RBI Discussion Paper on Climate Risk and Sustainable Finance: July 27, 2022
- SBI introduced ‘green car loans’ for electric vehicles — 20 basis points lower interest rate
- SEBI mandated Business Responsibility Reports for top 100 listed entities since 2012
Section 5 — Exam Angle Points
All PYQ answers verbatim + high-frequency facts
✅ Must-Know Facts — Verified from PDF
- SDGs announced: September 2015 by United Nations General Assembly
- SDG time frame: 2016-2030
- Number of SDGs: 17 | Number of targets: 169
- SDGs proposed at: Rio+20, United Nations Conference on Sustainable Development, June 2012
- SDGs superseded: Millennium Development Goals (MDGs) which were expiring in 2015
- SDG 13: Climate Action — “Take urgent action to combat climate change and its impacts”
- Global warming limit target: 1.5°C — scientists recommend cutting emissions by 45% by 2030 (vs 2010 levels)
- 193 Parties (192 countries + EU) communicated first NDC to UNFCCC (as of April 2022)
- 123 countries reported national disaster risk reduction strategies (as of Dec 31, 2021)
- Climate change cause (primary, since 1800s): Human activities — combustion of fossil fuels
- Climate change is a poverty multiplier — increases number of poor and makes them further poorer
- India’s SDG score: 60 (2019) → 66 (2021) — improvements in clean water & sanitation + clean energy
- Top state on SDG Index: Kerala (then HP, Tamil Nadu, Andhra Pradesh, Goa)
- SDG coordination in India: NITI Aayog
- India net-zero emissions target: 2070 (pledged at COP26, Glasgow, November 2021)
- Panchamrit — 500 GW non-fossil energy capacity by: 2030
- Panchamrit — 50% energy from renewables by: 2030
- Panchamrit — reduce carbon emissions by: 1 billion tonnes (now to 2030)
- Panchamrit — carbon intensity reduction by: Less than 45% by 2030
- OSOWOG: One Sun, One World, One Grid — announced at COP26
- Climate change GDP impact (World Bank projection): 2.8% per year lower by 2050
- CSR legal basis: Section 135 of Companies Act 2013
- CSR direction: Schedule VII of Companies Act 2013
- CSR mandatory spending: 2% of net profits
- CSR non-compliance: Civil wrong (NOT criminal) since 2020 amendment
- CSR penalty (company): At least Rs. 1 crore
- CSR penalty (officer): At least Rs. 2 lakhs
- 2019 CSR amendment: Treated non-compliance as criminal; 2020 amendment reversed this to civil penalty
- RBI PSL for renewable energy: Since 2015 | Firms: up to ₹30 crore | Households: up to ₹10 lakh
- India green bonds outstanding (Feb 2020): US$16.3 billion
- India renewable energy target (announced 2019): 450 GW by 2030
- RBI Discussion Paper on Climate Risk: July 27, 2022
- National Action Plan on Climate Change (NAPCC): Formulated 2008
📝 Actual PYQ Answers from PDF
Q1: Which section of Companies Act 2013 provides legal support for CSR?
(a) Section 135 (b) Section 235 (c) Section 295 (d) Section 195
(a) Section 135 (b) Section 235 (c) Section 295 (d) Section 195
Answer: (a) Section 135
Q2: Climate change is likely to lower India’s GDP by ___ per year by 2050 (World Bank)?
(a) 6.8% (b) 2.8% (c) 9.8% (d) 0.8%
(a) 6.8% (b) 2.8% (c) 9.8% (d) 0.8%
Answer: (b) 2.8 per cent per year
Q3: Which Indian state leads the SDG index 2021 by NITI Aayog?
(a) Telangana (b) Karnataka (c) Kerala (d) Gujarat
(a) Telangana (b) Karnataka (c) Kerala (d) Gujarat
Answer: (c) Kerala
Q4: India aims to achieve target of net zero emissions by which year?
(a) 2030 (b) 2040 (c) 2050 (d) 2070
(a) 2030 (b) 2040 (c) 2050 (d) 2070
Answer: (d) 2070
Q5: To limit global warming to 1.5°C, scientists recommend by 2030 global emissions should be cut by ___ compared to 2010 levels?
(a) 45% (b) 25% (c) 5% (d) 10%
(a) 45% (b) 25% (c) 5% (d) 10%
Answer: (a) 45 per cent
Section 6 — Flash Cards & Summary
10-minute revision before your JAIIB exam
SDGs Announced
September 2015 | 17 goals + 169 targets
Time frame 2016-2030 | Proposed at Rio+20 June 2012 | Superseded MDGs
SDG 13
Climate Action
“Take urgent action to combat climate change and its impacts”
Global Warming Limit
1.5°C — cut emissions 45% by 2030
Compared to 2010 levels | Current commitments set for 14% INCREASE
India Net Zero Target
2070 (pledged COP26, Glasgow, Nov 2021)
Part of India’s Panchamrit commitments
Panchamrit — 500 GW
Non-fossil energy capacity by 2030
50% energy from renewables by 2030 | 1 bn tonnes carbon reduction by 2030
India SDG Score
60 (2019) → 66 (2021)
Kerala = #1 | NITI Aayog coordinates SDGs in India
Climate GDP Impact
2.8% per year lower by 2050
World Bank projection | Climate change = poverty multiplier
CSR Legal Basis
Section 135, Companies Act 2013
Schedule VII gives direction | 2% of net profits mandatory
CSR Non-Compliance
Civil wrong (NOT criminal) since 2020
Company: ≥₹1 crore penalty | Officer: ≥₹2 lakhs | 2019 had imprisonment
RBI PSL Renewable Energy
₹30 crore firms | ₹10 lakh households
PSL category since 2015 | ₹30 cr limit since Sep 4, 2020 (was ₹15 cr)
⚡ Chapter 10 Complete — Climate Change & SDGs
- 17 SDGs + 169 targets announced by UN General Assembly in September 2015 | Time frame: 2016-2030
- Proposed at Rio+20 (June 2012) | Superseded MDGs | SDG 13 = Climate Action
- Global warming limit = 1.5°C | Must cut emissions 45% by 2030 (vs 2010) | Current path = 14% increase
- Climate change = poverty multiplier | Primary cause since 1800s: human activities (fossil fuel combustion)
- India pledged net-zero by 2070 at COP26, Glasgow, November 2021
- Panchamrit: Net-zero 2070 | 500 GW non-fossil by 2030 | 50% renewable energy 2030 | Reduce 1 bn tonnes | 45% carbon intensity reduction
- India SDG score: 60 (2019) → 66 (2021) | Kerala = top state | NITI Aayog coordinates
- Climate change to lower India’s GDP by 2.8% per year by 2050 (World Bank)
- CSR: Section 135, Companies Act 2013 | Schedule VII | 2% net profits mandatory
- CSR non-compliance = civil wrong (2020 amendment) | NOT criminal | Company ≥₹1 crore, Officer ≥₹2 lakh
- RBI included renewable energy in PSL in 2015 | Firms: ₹30 crore | Households: ₹10 lakh
- India green bonds: US$16.3 billion outstanding (Feb 2020) | 0.7% of all bonds since 2018
- RBI Discussion Paper on Climate Risk and Sustainable Finance: July 27, 2022
- OSOWOG — One Sun, One World, One Grid — announced COP26 | Plastic Hackathon 2021
Banky says: “Now I can structure that ₹25 crore solar loan correctly — it’s a PSL green finance loan!” 🌱
You know all 17 SDGs, India’s Panchamrit commitments, net-zero 2070, CSR rules (Section 135), green finance PSL limits and all 5 PYQ answers. You’re a green banker now! 💪
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