This policy brief examines how targeted support can help low-income microentrepreneurs in Bangladesh adopt digital financial services (DFS). Based on a 12-month randomized controlled trial, the study shows that personalized training, follow-up support, and helplines significantly improved entrepreneurs’ confidence, customer engagement, and use of digital payments. Yet, transaction volumes remained limited due to barriers, such as high fees, connectivity challenges, and trust concerns. The findings highlight that sustainable digital financial inclusion requires integrated approaches that combine digital literacy, stronger consumer protection, supportive infrastructure, and behaviorally informed policies.
The policy brief was co-authored by Shawn Hunter (Griffith University), Sameer Deshpande (Griffith University), Mayank Sharma (MicroSave Consulting), and Peter J. Morgan (Asian Development Bank Institute).
A looming crisis stares down at India. As the world’s most populous nation and one of the fastest-growing economies, the country faces intensifying climate risks that directly threaten lives, livelihoods, and development gains. Over the past five years, extreme climate events have affected more than 75% of India’s districts and damaged more than 36 million hectares of crops. These numbers underscore the sheer scale, frequency, and systemic nature of climate shocks.
Despite this growing exposure, several constraints hold back India’s ability to plan for, finance, and implement climate adaptation and resilience. Climate systems and decision-support mechanisms are fragmented, siloed, and slow, with limited integration across sectors, such as agriculture, water, urban development, health, and finance. Even where sector-specific systems are available, they often lack a coherent climate risk and resilience lens. The result is reactive responses rather than anticipatory, risk-informed action. Such structural weaknesses can directly hurt effective climate finance.
In the section below, we discuss the challenges with a data lens.
Fragmented and outdated climate data ecosystem: Climate data in India is scattered across sectors and stored in inconsistent formats. The Ministry of Agriculturecollects land-use data through the Annual Crop Production Survey, while the Forest Survey of India conducts biennial assessments of forest cover. The Central Pollution Control Board monitors industrial emissions. Each of them uses different methodologies, timelines, and standards. This makes cross-sectoral analysis nearly impossible and creates blind spots.
Delayed emission mapping and reporting: Current greenhouse gas (GHG) inventories and biennial update reports (BURs) rely on episodic submissions rather than continuous monitoring. For instance, India’s third biennial update report(BUR-3), submitted to the United Nations Framework Convention on Climate Change (UNFCCC) in 2021, reported emissions data from 2016, a gap of five years.
Siloed vulnerability and climate action tracking: Climate risks across sectors are currently assessed in isolation, with limited integration between ministries and programs.. For example, the Pradhan Mantri Fasal Bima Yojanaor crop insurance scheme could benefit from stronger real-time integration and data interoperability with the India Meteorological Department’s early warning systems and the National Disaster Response Force’s preparedness programs.
Weak integration of climate data in budgeting and planning: At the grassroots level, recent efforts, such as the Climate Resilience Planning initiativeby the Ministry of Panchayati Raj and the UNDP, seek to integrate climate risk data into Gram Panchayat Development Plans (GPDPs). However, many panchayats still lack the capacity or tools to fully operationalize this data.
A unified digital public infrastructure (DPI) for climate can provide a transformative pathway to build resilience, enhance credibility, and position India as a global leader in climate action. Once operational, the DPI for climate could have an impact comparable to that of the India stack, which comprises Aadhaar-based eKYC, e-sign, and UPI in the financial sector. It could also have a similar impact to what the under-development AgriStack is expected to achieve for agriculture through the creation of reliable farmer- and farm-level data.
Introducing the climate stack: A unified climate intelligence system
The climate stack represents a paradigm shift from fragmented datasets to a unified, dynamically linked infrastructure that serves as a single source of truth on climate intelligence. Rather than create another database, the climate stack brings together a collection of core interoperable registries that address the following fundamental questions:
Emission registry: Which areas emit greenhouse gases, and how much?
This registry tracks greenhouse gas emissions across space and time to provide granular visibility into emission sources and trends.
Green assets and sequestration registry: Where are the carbon sinks, and what solutions are available?
This registry maps India’s natural capital, such as forests, wetlands, grasslands, and agricultural soils, which sequester carbon and provide ecosystem services.
Climate vulnerability registry: Which areas and communities are most at risk?
This registry assesses exposure, sensitivity, and adaptive capacity across India’s diverse landscapes and populations. It maps adaptation and mitigation actions, such as irrigation expansion, resilient seeds, watershed projects, afforestation, and renewable energy uptake, and also tracks their impact on reducing vulnerability over time.
The emissions profile spans four major sectors – energy, agriculture, waste, and industrial processes and product use (IPPU), each with distinct characteristics and data needs. In 2020, India emitted 2,958,589 Gg of CO₂-equivalent GHGs from the following sectors; thus, the climate stack should serve these four critical sectors:
Share of sectors in emissions as per BUR-4 MoEFCC, 2011 India BUR-4.pdf
Why should agriculture be the starting point?
Agriculture is a major source of emissions, a sector of high vulnerability, and a domain with a high potential for mitigation.
A major source of emissions:Agriculture contributes 13.72% of India’s total GHG emissions (BUR-4), primarily from enteric fermentation, rice cultivation, and fertilizer use. Globally, the agriculture, forestry, and land-use (AFOLU) sector accounts for 22% of emissions (IPCC AR6).
Highly vulnerable to climate change:More than 59% of India’s workforce depends on agriculture. Between 2016 and 2021, climate extremes damaged 36 million hectares of crops, which caused losses worth USD 3.75 billion. Yield losses could rise 10–25% by 2050 without adaptation (ORF).
High mitigation and adaptation potential:Climate-smart practices can deliver 30%+ of India’s total mitigation potential by 2030. Soil carbon enhancement and restoration of degraded farmlands offer some of India’s lowest-cost mitigation opportunities.
Agriculture already has data systems that map directly onto the three climate stack registries. These operational data systems can be integrated immediately.
Emissions registry: The major emission categories of agriculture—fertilizer use (N₂O), rice cultivation (CH₄), enteric fermentation and manure management (CH₄/N₂O), and crop residue burning—all have existing digital data sources. These include AgriStack, the Soil Health Card, DBT fertiliser systems, and the livestock stack. Together, these categories represent more than 80% of agricultural emissions. This makes agriculture the most natural starting point for the proposed emissions registry.
Sequestration registry: Data for carbon sinks is more complex to source, though some are available readily in existing systems. These include the Forest Survey, which captures forest biomass, canopy density, and carbon stock, and the Soil Health Card, which tracks soil organic carbon for croplands. The AgriStack further provides data on cropland area, land use, and residue cycles. Since croplands and forests form the bulk of India’s terrestrial carbon sinks, governments can digitize and geotag datasets to build the sequestration registry.
Vulnerability and climate action registry: Agriculture produces the richest hyperlocal climate-risk signals. These signals cover exposure measured through maximum and minimum temperatures, and sensitivity measured through annual rainfall and disaster proneness. Adaptive capacity is captured through irrigation access, extension reach, and credit penetration. These align directly with the exposure–sensitivity–adaptive capacity framework used by the ICAR.
What should the climate stack’s data architecture look like?
The climate stack is conceived as a federated digital public infrastructure that unifies India’s climate-relevant datasets without centralizing them. The architecture described below represents the climate stack’s overall design logic and is intended to remain consistent across sectors. However, as agriculture, forestry, and land use form the natural starting point, the illustration below presents the same architecture through an AFOLU lens. This version does not alter the core design. It simply maps the data ingestion layer to AFOLU-relevant systems to show how existing datasets flow into the federated registries. These systems include agriculture databases, remote sensing platforms, climate models, and disaster management systems.
Data architecture for climate stack (for AFOLU sector)
The climate stack will not replace existing systems. It will link them through shared standards and interoperable APIs. A data aggregation and standardization layer harmonizes diverse data sets using common taxonomies, identifiers, metadata standards, and quality protocols. This enables integrated analysis across satellite data, sectoral records, weather feeds, and disaster information. These harmonized inputs feed into three federated core registries, namely, emissions, sequestration, and vulnerability. Each of these answers a fundamental climate question and leaves raw data with respective custodians.
A dedicated governance layer ensures the stack is trusted, secure, and institutionally sound. It draws on existing legal and policy frameworks for data protection, privacy, consent-based sharing, interoperability, and stewardship. Clear data-sharing agreements and accountability mechanisms provide confidence across ministries, states, and stakeholders.
The stack unlocks value through clearly defined use cases. It enables high-integrity emissions and sequestration reporting, and real-time and hyper-local climate advisories. It also integrates climate intelligence into local and district planning and ensures the development of climate-resilient financial and insurance products. It supports mitigation and adaptation objectives as it structures climate intelligence into decision-ready formats.
This data architecture serves a diverse set of users. Governments can gain reliable intelligence for reporting and policy, while farmers receive actionable advisories. Local bodies can embed climate risk into planning, and private sector and financial institutions can build resilience-linked products. This is how the climate stack will shift India from fragmented data systems to coordinated, data-driven climate action.
The climate stack offers India an integrated, future-ready approach to climate action, with agriculture as the natural entry point. Its design is intentionally modular, and as India advances digitalization across sectors, the stack can expand to cover energy, waste, and IPPU. Energy is already the next frontier, with early groundwork underway for an energy stack.
The latest Union Budget has drawn mixed reactions to the government’s climate actions. Some applaud the proposed investments in mitigation, while others argue that climate adaptation measures are insufficient. Such contentions partly stem from limited clarity on how the government is spending on climate change across its myriad schemes and ministries. An annual climate budget statement, based on a common national framework, would bring needed transparency by classifying, tracking, and reporting on the government’s climate-related spending.
A climate budget shows how and where public money is spent towards climate change. It identifies which schemes contribute to climate goals, whether to curb emissions or adapt to heatwaves, and to what extent. This approach, also known as “climate budget tagging” (CBT), is recognized as a global best practice by organizations such as the International Monetary Fund and has been adopted by over 60 countries. The World Bank has shown that CBT increases institutional focus on climate risks while improving fiscal transparency and accountability.
Although the central government has not introduced a climate budget, eighty-eight states and union territories have pioneered the practice. While each of these states follows a slightly different approach to climate budgeting, they provide useful lessons for the country.
Odisha’s Climate Budget outlines its key climate objectives and assesses two aspects: the extent to which a scheme contributes to climate resilience, and its vulnerability to climate risks. For example, the soil conservation and watershed management scheme contributes 70% of its budget toward climate resilience, but 50% of its expected impact is vulnerable to climate risks. Odisha’s climate budget attempts to show how it is responding to and affected by climate change, but does not explain how these judgments are determined.
Bihar’s Green Budget does not measure vulnerability, but it does importantly explain how each scheme contributes to climate goals. It also links scheme contributions to the Sustainable Development Goals (SDGs). This approach, developed by the UN Environment Programme (UNEP), clearly shows how schemes affect climate change and align with international goals.
Finally, Kerala’s Environment Budget, beyond summarizing climate objectives and spending, discusses how the annual budget is linked to key state development plans, such as the Kerala Perspective Plan 2030, and the SDGs. This uniquely shows how Kerala is advancing its long-term climate goals.
Overall, these States show strong initiative to track climate spending. However, the different methods limit comparison between States. There could also be more details, such as on whether a scheme supports mitigation or adaptation, and what this spending aims to achieve.
Leveraging this momentum and lessons from exiting state budgets, the union government must develop a national framework for climate budgeting to guide implementation at the central and state levels. Recognizing each government’s unique policy priorities, this framework should outline the essential components for tagging expenditures while allowing flexibility to add other aspects, like vulnerability. Based on national best practices and global standards like the Public Expenditure and Financial Accountability program, the national framework should emphasize three key aspects.
First, a climate budget should have a clear tagging protocol that identifies overall climate expenditure and its specific areas. To track overall spending, programs should be tagged as “completely” or “partially” relevant to climate (e.g., 50%) to reach a precise figure, as some States already do. To track spending on specific themes, there should be a minimum filter to view spending on climate adaptation and mitigation. This would allow a comprehensive picture of climate spending. The Ministry of Finance (MoF) has already provided a useful starting point through its draft framework on climate finance taxonomy, which offers a common system for the private sector to classify investments as “climate supportive” or “transition supportive”. This could be applied to climate budgets.
Second, the climate budget should align with major state, national, and international strategies, as Kerala does. India has outlined ambitious goals to achieve a sustainable and resilient economy, like the Long-Term Low-Carbon Development Strategy, Nationally Determined Contributions, and the forthcoming National Adaptation Plan. Union and state budgets should clearly link to these strategies to ensure that spending advances longer-term climate goals.
Third, the climate budget should report what outputs and outcomes will result from climate spending. For instance, Kerala spends on forest regeneration but does not specify a goal on restored forests. States like Odisha already produce “outcome budgets” that capture program goals, which could be integrated into climate budgets. The Output-Outcome Monitoring Framework does this for central schemes. A climate budget should set measurable goals to track impact.
Altogether, these principles would ensure climate budgets in India are comprehensive, aligned with broader development strategies, and actionable.
Moving forward, MoF should form a committee with the Ministry of Environment, Forest and Climate Change, States, and the 16th Finance Commission to spearhead the framework development. This national framework would provide clear guidance to governments on embedding climate priorities across planning and budgeting. Amidst serious climate risks, the union and state governments must clearly demonstrate how they are investing in a resilient future through climate budgets.
Biopharma Shakti initiative marks a strategic push toward self-reliance in high-value pharmaceutical manufacturing
Union Finance Minister Nirmala Sitharaman presented the Union Budget 2026–27 with a strong focus on strengthening India’s healthcare ecosystem. The announcements emphasise biopharma manufacturing, medical and allied health education, regional access to care, traditional medicine systems, and mental health as an emerging national priority.
Key Announcements
Biopharma Shakti Initiative:
An outlay of Rs 10,000 crore over five years has been proposed to position India as a global biopharma manufacturing hub. The initiative aims to accelerate domestic capabilities in biologics, biosimilars, and advanced pharmaceutical production, reinforcing supply resilience and global competitiveness.
Biopharma-Focused Institutional Strengthening:
Three new National Institutes of Pharmaceutical Education and Research (NIPERs) will be established and seven existing ones upgraded to support biologics production, pharmaceutical research, and regulatory capacity.
Expansion of Allied Health Education:
Institutions for allied health professionals (AHPs) will be upgraded and expanded across ten disciplines, including optometry, radiology, anaesthesia, and applied psychology. The target is to train one lakh AHPs over five years to address systemic workforce gaps.
Regional Medical Hubs:
Five regional medical hubs will be developed in partnership with states to improve access to advanced healthcare infrastructure and reduce geographic disparities.
Strengthening Traditional Medicine Systems:
The government announced three new All India Institutes of Ayurveda, upgrades to Ayush pharmacies and drug testing laboratories, and continued support for the WHO Global Traditional Medicine Centre in Jamnagar.
Mental Health as a National Priority:
A new National Mental Health Institute, “NIMHANS 2,” will be established to address evolving mental health challenges, including those faced by digital professionals and content creators.
Implications for the Healthcare Sector
The Biopharma Shakti initiative marks a strategic push toward self-reliance in high-value pharmaceutical manufacturing, with potential to improve affordability and availability of advanced therapies, particularly in oncology, immunology, and rare diseases.
Expansion of NIPERs strengthens India’s pharmaceutical research and talent pipeline. Its long-term success will depend on effective industry collaboration, curriculum modernisation, and regulatory alignment.
Investment in allied health capacity addresses critical non-physician workforce shortages, improving hospital efficiency, diagnostics, surgical support, and mental healthcare delivery.
Regional medical hubs can ease pressure on metropolitan tertiary centres and strengthen secondary care systems, provided implementation and financing frameworks are robust.
The expansion of traditional medicine infrastructure signals continued policy commitment, though evidence generation and regulatory harmonisation remain essential for global credibility.
Finally, elevating mental health through institutional expansion reflects growing recognition of digital-era psychological stressors and the need for accessible, stigma-free care within India’s broader public health framework.
This was first published in “Bio Spectrum” on 24th February 2026.
Repeated climate shocks are pushing Bangladeshi households to the edge, exposing gaps in the financial support they rely on. While MFIs provide critical relief, evidence shows that proactive, anticipatory finance and scalable solutions could help communities absorb shocks and adapt sustainably
Bangladesh faces a climate reality that our current financial systems struggle to withstand. We are at the frontline of climate change as recurring disasters, such as cyclones, floods, droughts, and salinity intrusion, erode livelihoods and financial stability. The impact is more profound for low-income households, as climate shocks disrupt their incomes and the financial tools they depend on, which span savings, loans, and informal support networks.
In our work across districts, such as Satkhira and Rangpur, we have seen how households navigate pressures. Our findings, published in “Building the resilience of BURO Bangladesh’s customers to the impacts of climate change,” reveal behavior patterns that vary entirely with the timing of climate events.
When climate disasters strike, households rely primarily on savings as their first line of defense. They withdraw deposits or sell small assets to cover food and medical needs. The initial income shocks suppress borrowing, but demand for credit rebounds once reconstruction begins. As savings dry up and formal loans face delays, many households turn to informal lenders. Women face additional barriers because limited mobility restricts their access to timely finance. These behaviors align with the BRACED 3A framework of anticipation, absorption, and adaptation. Yet, we believe, coping strategies remain fragile. Without quick financial support, households spiral deeper into debt.
Microfinance institutions (MFIs) provide essential support, but remain constrained by market realities. BURO Bangladesh offers repayment deferrals and temporarily pauses disbursements to protect liquidity and ease the pressures of default. Emergency loans help families meet basic needs, although loan sizes often fall short of actual losses. Flexible policies allow clients to withdraw savings for repairs or food purchases. Field staff also shift from regular operations to relief efforts during extreme events to help households regain stability.
These responses remain largely reactive because they activate only after damage occurs. MFIs face mounting risk of customers’ over-indebtedness, delayed repayment that hurts liquidity, and increased provisioning requirements. Operational disruptions, such as damaged roads and power outages, further restrict service delivery. These barriers highlight a critical gap in our current system. MFIs help households absorb shocks, but they do not yet enable them to anticipate or adapt effectively.
Global experience shows how inclusive finance can evolve from reactive relief to proactive resilience. Insurance represents one major gap. The Microinsurance Network’s 2023 report shows that while approximately 330 million people across 36 countries now have some form of inclusive insurance, nearly 88% of vulnerable households worldwide still lack coverage. Another example is the InsuResilience Global Partnership, which reported that 319 million people benefited from climate and disaster risk finance in 2024, while micro-level beneficiaries in low-income countries almost doubled year-over-year. This momentum could be harnessed more effectively in Bangladesh through MFIs and their agent networks to extend protection to those most exposed.
Evidence shows that anticipatory action works best when finance follows pre-arranged triggers. The International Federation of Red Cross uses thresholds to unlock funds before disasters strike. BRAC tested this approach in Bangladesh and found that pre-approved loans helped households maintain higher consumption levels. New initiatives, such as Atram.ai, are further advancing this logic through AI-driven models that trigger financing for households and small businesses before climate shocks occur.
Finally, capital must be scaled to create systemic resilience. Small, fragmented loans need to be aggregated into investable pools. Regulators and supervisors have started to recognize this. The Network for Greening the Financial System (NGFS) has urged the integration of climate adaptation into financial supervision to create structures that enable microloans to be bundled, de-risked, and financed at scale. Such approaches could help bridge the protection gap and give MFIs the resources they need to serve clients in increasingly volatile conditions. The message is clear. Proactive finance reduces losses and strengthens resilience far more than reactive aid.
The experience of BURO Bangladesh and its clients shows both resilience and strain. Families often rely on savings, loans, and informal networks to make ends meet. Meanwhile, MFIs provide lifelines through repayment deferrals, emergency loans, and flexible withdrawals, which are primarily reactive measures to help people survive rather than prepare them for the future.
As climate risks intensify, Bangladesh needs to redesign its financial systems to ensure that vulnerable households go beyond survival in the face of shocks and build the capacity to anticipate and adapt. This shift from reactive coping to adaptive resilience is no longer optional. It is essential to protect Bangladesh’s most climate-exposed communities and ensure long-term financial security.
