India has told the G20 grouping that carbon tax should not be counted as a new and additional source of funding to fight climate change.

Making an intervention at the G20 Finance Ministers’ meeting on September 23 at Washington, the Finance Minister, Mr Pranab Mukherjee said that measures like carbon tax and levy on CDM offsets violate the principle of UN Framework Convention on Climate Change (UNFCCC) as the incidence falls entirely on developing countries.

There is a talk that developed countries could levy unilateral trade measures (UTM) such as carbon tax on goods and services imported from developing countries on environmental grounds. India has opposed any such move and has sought inclusion of UTM as an additional item for discussion at the upcoming climate talks in Durban in South Africa.

In his intervention, Mr Mukherjee also opposed inclusion of international levies on shipping and aviation emissions as revenue raising options until a mechanism for refund of the revenues collected from developing countries is instituted. “The refund should not be treated as climate change finance flow or a contribution of developing countries to global revenue mobilisation”, he said.

India has also said that the flow of finance leveraged by the international financial institutions (IFIs) or the multilateral development banks (MDBs) should be counted towards the overall target only if there is a net additional infusion of capital by the developed countries to the capital base of the MDBs/IFIs.

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