We Should Offer Incentives to Startups in Climate Change Space

Crafting climate change is a daunting task, primarily in developing nations where technology is still at its infancy stage. In the opinions of expert scientists worldwide, developing nations like India will have to bear the brunt of climate change and struggle to adapt and sustain economic growth owing to their weak infrastructure and inadequate financial resources. India will be hit hardest by the shifts in rainfall and soaring temperatures. Global warming is a “global crisis” acting as a “threat multiplier,” but regrettably, no one pays due attention. The hotter temperatures will induce droughts, and this further will lead to poverty. The story doesn’t end there; elevated levels of hunger and poverty will further cause economic distress or even pillage. An efficient transformation approach needs to be followed to mitigate this threat collectively.

Incentivising Start-ups

Dealing with the impediments of climate change will require across-the-board economic and social transformations. Start-ups have the potential to accustom new and improved technologies into a wide usage to disrupt the stagnation and hegemony of existing technologies and intensify economic growth sustainably. A climate change start-up will provide services that will have the potential to transform the way we live, making the use of artificial technology, nanotech, blockchain systems, and data science.

However, entrepreneurs have to confront many obstacles such as insufficient encouragement to take up their responsibility, lack of financial support, and limited incentives to work for climate change. In developing countries such as India, entrepreneurs have to cope with these massive difficulties owing to the dearth of capacity, knowledge, and resources to address the issues.

There is a need to take urgent action for climate change and assist entrepreneurs in overcoming such obstacles to the path of success and support them in their endeavours.

By incentivising start-ups contributing to the global response to climate change, governments can build livelihoods for local talents, young and old.

A healthy entrepreneurial ecosystem is the need of the hour to embark on activities that provide holistic support for the development of innovative solutions and their commercialisation. Collaboration among individuals, institutions, and entrepreneurs can create an entrepreneurial ecosystem for a sustainable environment. Such a system motivates individuals to come to the forefront and design concrete solutions for real problems. A benevolent incentive system with robust infrastructure and a supportive culture that provides access to knowledge and training and provides financial support with a safety net when entrepreneurs fail inevitably can be pretty reassuring. 

Drivers for Growth

Venture capital is the key to enable transformation through critical solutions requiring rapid commercialisation. Start-ups do not need trillions of investments; all they need is targeted support from the government in research and development for trickier technologies at early stages where huge capital needs line up. The climate tech market is maturing; however, the ecosystem for entrepreneurship is still nascent, with key gaps in depth. To scale up start-ups and tackle well the structural hurdles, an appropriate incentivising mechanism is essential.

Actions Needed

Governments need to provide ample opportunities to entrepreneurs working in the climate change space, such as designing targeted communication and awareness programmes. Efforts must be taken to enhance the infrastructure needed for practical entrepreneurship and promote international networking amongst local and medium-sized enterprises to design responsive solutions. Governments must implement suitable training and education programmes to foster female entrepreneurship and provide for niche support programs. Regulatory reforms can be undertaken to make it easier for individuals to do business. Other regulatory reforms might include supportive measures such as tax cuts for small businesses, microfinancing, and social protection programs. Appropriate incentivizing schemes for individuals must be designed to become entrepreneurs and support the environment sustainably.

Few individuals have the global perspective to look far beyond time into the future. Designing “sustainable” solutions to improve the environment and bring climate change into the picture requires these individuals. Start-ups create innovative business models changing how things work. Leading them to the right path with the proper support will help achieve positive change at the earliest.

The author is Founder, We the Planet

DISCLAIMER: Views expressed are the author's own, and Outlook Money does not necessarily subscribe to them. Outlook Money shall not be responsible for any damage caused to any person/organisation directly or indirectly.