Climate Finance Synthesis Report: Assessing the needs, flows and gaps in climate financing in the HKH countries

Executive Summary

The Hindu Kush Himalaya (HKH) region is experiencing severe climate risks—glacial melt, biodiversity loss, and extreme weather—threatening ecosystems, livelihoods, and billions of people dependent on its resources. ICIMOD’s synthesis report highlights urgent climate finance needs and gaps across HKH countries.

Key Findings:

• Finance Needs: USD 12.065 trillion required from 2020–2050 for mitigation and adaptation (USD 768.68 billion annually).
• Distribution: China and India account for over 92% of needs; smaller economies (Nepal, Bhutan, Afghanistan, etc.) face critical financing gaps relative to GDP.
• Global Context: Despite USD 1.3 trillion annual global climate finance (2021/2022), HKH receives disproportionately low shares, especially for adaptation, agriculture, water management, and disaster risk reduction.
• Challenges: Limited private sector engagement, weak institutional capacity, fragmented policies, and poor data infrastructure.

Recommendations:

• Strengthen national governance and institutional capacity for climate finance.
• Establish an HKH Climate Finance Network for regional collaboration.
• Deploy innovative instruments: green/blue bonds, debt-for-climate swaps, carbon markets.
• Enhance private sector participation through enabling policies and bankable projects.
• Improve data systems, risk assessments, and reporting for transparency and investment.

Conclusion: Urgent, targeted financial investment and collective action are critical to build resilience, safeguard ecosystems, and ensure sustainable development in the HKH region.