The Hindu Kush Himalayan (HKH) region, one of the world’s most climate-vulnerable areas, faces a monumental funding challenge to address the growing threats posed by climate change. According to a new report by the International Centre for Integrated Mountain Development (ICIMOD), the region will require approximately $12.065 trillion between 2020 and 2050 to meet its climate mitigation and adaptation needs. This translates to an annual average of $768.68 billion, with India and China together accounting for over 92.41% of this requirement. Smaller HKH nations, including Nepal, Bhutan, Bangladesh, Afghanistan, Myanmar, and Pakistan, face critical financing gaps relative to their GDPs, highlighting the urgent need for global and regional support.

Climate Finance Needs and Gaps

India’s total climate finance requirement for the 2020–2050 period is estimated at $2.685 trillion, yet actual inflows during the 2018–2021 period amounted to only $80.6 billion, a small fraction of the need. China, which accounts for a larger share of the HKH region, faces total financing needs of $8.46 trillion over the same period. The report notes that global climate finance flows reached approximately $1.3 trillion annually in 2021/2022, largely directed toward mitigation activities in developed and larger emerging economies. In comparison, the HKH region receives significantly lower shares, and multilateral and bilateral climate finance often falls short of committed levels.

The climate vulnerabilities in the HKH region are severe and multifaceted. Rising temperatures, glacial melting, and extreme weather events—including glacial lake outburst floods (GLOFs), landslides, droughts, floods, forest fires, and intense monsoons—pose an escalating threat to ecosystems, livelihoods, and food security, particularly in rural and mountainous areas. Coastal and low-lying regions face additional risks from cyclones, sea-level rise, and salinity intrusion, while rapid urbanization strains critical infrastructure, including water, energy, and transport systems.

Despite the urgency, sectors that are crucial for adaptation—such as agriculture, water management, disaster risk reduction, and community resilience programs—remain significantly underfunded. The report cites limited private sector engagement, fragmented policy frameworks, inadequate institutional capacity, and weak data infrastructureas barriers preventing effective mobilization of climate finance in the region.

Disparities and Economic Pressures

The report highlights stark disparities between countries’ climate vulnerability and their financial capacity. Nations highly exposed to climate impacts—including Bangladesh, Bhutan, India, Myanmar, Nepal, and Pakistan—are among the least equipped to manage these risks, often spending a disproportionate share of their resources on disaster response and adaptation. Countries such as Afghanistan, Nepal, and Pakistan bear adaptation burdens far exceeding global averages, creating a cycle where most available resources are used for repair and recovery, leaving limited capacity for long-term development.

Per capita climate finance needs also vary widely across the region, ranging from as low as $24 in some countries to over $2,126 in others, representing 6% to 57% of national GDP, respectively. These figures underscore the immense pressure policymakers face in balancing developmental priorities against the urgent needs of vulnerable populations.

Ghulam Ali, the lead author of the ICIMOD report, described the task of mobilizing $12 trillion for climate action as akin to “climbing the Everest of funding”. He emphasized that the strategy to secure these resources must be innovative, collective, and comprehensive, drawing on public, private, and multilateral sources.

Recommended Strategies

The report outlines a series of measures to address the financing challenge. Key recommendations include:

1. Strengthening national institutional capacities and governance frameworks to ensure effective management and mobilization of climate finance.
2. Establishing an HKH Climate Finance Network to facilitate knowledge exchange, capacity building, and collaborative regional financing efforts.
3. Leveraging innovative financial instruments, including green and blue bonds, debt-for-climate swaps, and voluntary carbon markets, tailored for mountain economies.
4. Enhancing private sector engagement through improved policies, incentives, and the creation of bankable climate projects.

The report draws on a wide range of sources, including the UNFCCC Standing Committee on Finance, World Bank, UNEP, OECD, Climate Policy Initiative’s Global Landscape of Climate Finance, and national climate plans such as Nationally Determined Contributions (NDCs), National Adaptation Plans (NAPs), and Biennial Transparency Reports (BTRs).

Global Climate Finance Context

ICIMOD notes that while the HKH region receives limited funding, developed and larger emerging economies attract the majority of global climate finance, predominantly for mitigation rather than adaptation. This imbalance has significant consequences for HKH countries, where adaptation and disaster resilience are critical. Limited access to finance, coupled with increasing climate risks, threatens the sustainable development and socio-economic stability of the region.

The report also highlights developments at the international climate negotiation level. At COP30, several key decisions were adopted, including a work programme on Article 9.1 of the Paris Agreement, which outlines the legal obligation of developed countries to provide financial resources to developing nations for climate action. While aspirational calls for increased climate finance were included, the formal text of the agreement omitted explicit references to fossil fuels and weakened earlier commitments on adaptation funding. Nonetheless, the COP30 agreement established a two-year work programme on climate finance and convened a high-level ministerial roundtable to discuss implementing the New Collective Quantified Goal on climate finance, originally agreed at COP29 in Baku.

Urgency for Action

The ICIMOD report frames the climate crisis in the HKH region as fundamentally a matter of economic equality. Countries facing high exposure and low capacity are caught in a cycle of vulnerability, often compelled to spend disproportionate resources on immediate adaptation needs at the expense of development. Without a dramatic scaling up of financial flows, the HKH region risks falling further behind in climate resilience and sustainable development.

The report underscores the need for regional cooperation, innovative financing mechanisms, and strong institutional frameworks to mobilize the staggering $12 trillion required over the next three decades. Only through coordinated efforts—engaging governments, multilateral institutions, and private investors—can the region hope to mitigate the impacts of climate change and protect millions of people living in its fragile mountain ecosystems.

In conclusion, the ICIMOD study presents a stark picture: the Hindu Kush Himalayas are facing an unprecedented climate finance gap, with urgent action needed to safeguard ecosystems, livelihoods, and development. Mobilizing resources at the scale required will demand creativity, collaboration, and commitment from both national and international actors, ensuring that this climate-vulnerable region does not bear the brunt of a global crisis.