India: Enhancing public-private sector partnerships for climate change adaptation in Maharashtra

What is the problem?

Maharashtra State is one of the wealthiest and the most developed states in India, contributing 25% of India’s total industrial output and 23% of its GDP. Commerce and the services industry dominate the economy of Maharashtra, accounting for two-thirds of the gross state domestic product. However, the Government of Maharashtra has been slow to take up the challenges posed by climate change, and has not focused sufficient attention to developing, prioritizing and implementing its Maharashtra State Adaptation Action Plan on Climate Change (MSAAPCC). In view of the huge water shortage problems facing the state, brought about at least in part by water over-exploitation by huge sugar-cane plantations, but also by reduced rainfall as a result of climate change, this seems short-sighted.

Given the severity of the challenge, the Government of Maharashtra requested ACT to support it in seeking to find ways of working with strong corporate partners to support its climate change programmes. This is an entirely new and innovative programme.

What is ACT doing about it?

This intervention seeks to encourage and nurture partnerships between the government and the private sector using climate change adaptation as an innovative focal point, and grounding this through pilot projects that support the livelihoods of the poorest and most climate change vulnerable communities.

Corporate partners have been identified through a process of self-selection. In the first place, over 80 companies took part in meetings with the government and the ACT Team. This gradually reduced, as the nature and demands of the work became clearer. There are currently four candidates that have decided to engage fully, and these are Tata Power, Ambuja Cement, Godrej Industries and Mahindra. Initial activities will involve implementation of pilot projects, located in selected areas where companies are working and where joint programmes can be developed around introducing climate change adaptation into government schemes, probably focused on watershed management, alternate livelihood options and climate resilient agriculture. These companies have developed ‘co-investment’ project concept notes, and these form the basis around which discussions are proceeding.

The ACT team were ideally placed to facilitate these partnerships, having a sound knowledge and experience of working with public-private partnerships in a climate change adaptation context.

How do the government and companies benefit?

The government has many programmes and schemes in several sectors that address broad development issues, such as health, education, water and sanitation, and rural development. Following discussions between the government and corporate partners, watershed management will provide the basis for early pilots. There is huge scope for introducing climate-resilient management around existing government watershed schemes. By joining together with powerful corporate partners, the government will be able to increase the reach of these programmes and thus address the needs of greater number of the most climate-vulnerable people. DFID has a long experience of implementing a number of highly successful watershed programmes in India, and this offers the prospect of some fruitful partnerships.

For the private sector, this provides a way of channeling funds into legitimate activities around climate change adaptation with the communities with which it works, often near its plants and factories. It also enables companies to meet some of their Corporate Social Responsibility (CSR) commitments – which requires them to spend a percentage of profits on social support activities. CSR programmes cover a range of activities including community development, education, environment and healthcare, and increasingly climate change. CSR activities are being integrated by an increasing number of larger companies throughout their ‘sustainable business’ operations, with the basic objective of maximizing impact on society. A growing number of corporates feel that CSR is important for protecting goodwill and reputation, defending attacks and increasing business competitiveness. Climate change adaptation provides new direction, and fits into their plans very well.

How do the poor and vulnerable benefit?

Additional resources from both the government and the corporates will become available for projects that immediately benefit the rural poor.

The pilot projects that will be implemented will cover up to 250 villages, and the same number of watersheds, in the initial pilot phase. The poor and most vulnerable communities will be selected by the implementing partners, in areas where building climate resilience is a priority.

Watershed schemes have poverty reduction and the generation of secure lives and livelihoods as a primary aim. The objective is to promote the economic development of dependent communities through the utilization of the watershed’s natural resources. Employment generation and the development of human resources to promote savings and other income-generating activities are encouraged. Sustained community action supports the operation and maintenance of created assets. Special emphasis is placed on improving the economic and social conditions of the resource-poor and vulnerable sections of communities, such as women and the asset-less, through more equitable distribution of the benefits tied to land and water resource development.

What happens next?

Tata Power, Ambuja Cement, and Godrej Industries will now engage in bilateral discussions with the government to decide on the outlines of the pilot projects. This will include the geographical locations, the government schemes that will be supported, and other implementation details. Once this has been decided, a detailed project design work can begin. ACT will continue to facilitate these discussions, and offer advice where appropriate.