The government and the central bank are deciding on who should oversee climate risk from a finance perspective, Reserve Bank Deputy Governor M K Jain said on Friday.
The RBI has started its own work on the issue, which includes forming an internal sustainable finance group which will come out with a guidance note shortly on how to go ahead, Deputy Governor M Rajeshwar Rao said.
"With regard to climate risk, I think it is at the nascent stage and a debate is going on among the regulators as well as the government whether it should be within the domain of the government or the regulator," Jain told reporters in the customary post-policy review conference.
Rao supplemented him saying that the RBI has recognized the importance of the issue internally and taken a slew of measures.
These include joining a network for greening of financial system and also groups under the aegis of Network of Central Banks and Supervisors for Greening the Financial System (NGFS), he said.
"We have also set up a sustainable finance group internally to look at this issue. The idea is we could look at this issue comprehensively and come out with some kind of a guidance note in a short period of time," he added.
The Intergovernmental Panel on Climate Change had a few months ago come out with a warning that the planet is heating faster than earlier estimates and given a code red for humanity. Proponents feel finance can play an important part in reversing or restricting certain aspects and hence ideas about incentivising the better ideas are taking root.