Countries are dealing with multiple crises – energy and food crises, inflationary pressures and the spectre of recession – coming on the back of the economic impact of the pandemic. They are dealing with these immediate and vexed issues in context of a broader challenge: the triple environmental crisis that requires all countries to shift from a carbon-dependent economy to a carbon-neutral one. It is a perfect storm. It is difficult for governments, particularly in developing countries, to move forward in a manner that helps deal with the current crises, take effective measures to tackle the environmental crises, meet the 2030 Sustainable Development Goals (SDGs) and remain on track to fulfil the Paris Agreement mandate. To not fall behind as a country and ensure that no one is left behind will require governments to provide support to those who need it. Such efforts are being put in place by governments in rich and poor countries alike. In calling for this distinction, Sitharaman stressed on the need for accountability. Targeted subsidies must be delivered in an efficient manner avoiding waste and leakage.
These targeted support subsidies must be designed in a manner to put economies on a trajectory of sustainable consumption and production. Subsidies that do not help reduce resource waste must, in the order of things, be revisited and duly scrapped.