The issue of technology transfer from industrialised to developing countries, a contentious issue in the ongoing climate change negotiations, should be seen as a win-win situation by both blocs, say leading Indian business leaders. It can be resolved by developing innovative financial mechanisms, which reward the innovator without putting the financial burden on technology users.
While developing countries have suggested measures like intellectual property rights (IPRs) related to clean technology to be treated as public goods or buying them down to get around the issue of financing estimated by UNFCCC to cost $200 billion by 2020, most Indian business leaders are in favour of market mechanisms supported by incentives for managing technology transfer and deployment.
Emphasising that IPRs must be recognised for India to move up on the technology index, Jamshyd N Godrej, chairman, Godrej and Boyce Manufacturing, adds, “Adopting clean technologies is in our self interest. To expect others to pay for it is not quite right, but there are bound to be situations in which one may have to deploy a technology that is unaffordable. In that case, financial support would be required.” The engineering and consumer products conglomerate is known for green products like CFC-free refrigerators.
Pramod Chaudhari, chairman, Praj Industries, a biofuel solutions company, adds, “Such technologies from developed countries may be put in a repository, which in turn can be provided to developing countries as public goods. A suitable funding mechanism to support such activity needs to be developed simultaneously.”
In any case, clean technologies by themselves are not enough. “It calls for an innovative ecosystem,” says Arun Seth, chairman, BT India. Drawing a parallel with the success of the IT industry, he says, “Climate change is an opportunity for us to develop our homegrown technology and an entire ecosystem to cater to a global market.” A recently released report has estimated that clean technology business can generate 10 million jobs in India by 2025 if IPRs are respected. Seth, who is also a director with Acme Group, which sets up solar thermal plants, emphasises, “You need to think differently to make it work.”
Driving home the need to develop innovative financial solutions to help development and deployment of clean technologies succeed, Chetan Kumaar Maini, deputy chairman & CTO, Reva Electric Car Company, quotes an example, “Clean technology owners can provide devices to users against a share of the carbon credits that they earn, eliminating the need for upfront financial transaction.” Besides, energy efficiency is not always costlier. There is a pay back, may be over a longer period of time, he adds. Reva itself has got 10 patents and is setting up manufacturing in the US.
Indresh Batra, MD, Jindal Saw, adds, “Even if some clean technologies are costlier, they can recover costs over a period of time. In any case, we can fix the price of carbon at a higher price to make clean technologies viable.” The pipe major has expanded into waste-to-energy and water infrastructure.
While it may take time to figure out innovative solutions, in the meantime it may help to keep it simple and have a global technology transfer mechanism in place. Amit Mitra, director general, Ficci, says, “We are in favour of a global fund, supported mostly by developed countries, which will pay the licensing fee to technology owners and transfer it to developing countries.”
The government has already proposed setting up of climate innovation centres, which would focus on innovation in climate change adaptation and mitigation technologies at regional levels. Such centres are expected to keep in view the local requirements and absorption capacities.
Mechanisms like a multilateral clean technology fund, multilateral technology acquisition fund, world climate change fund, or venture capital fund have been proposed to support such technology transfer proposals. Its to be seen how the final round of climate change talks in Copenhagen in December resolves the issue.
Source: The Financial Express
Published on 11 November 2009