This article was originally published by The Financial Chronicle.

The just-released report by the Intergovernmental Panel on Climate Change confirms what many suspect from their own experience and from the warnings of scientists: The impacts of global warming have arrived and are already being felt all over the world. Without further action, the impacts of climate change will continue to mount with devastating implications for human well-being and economic development.

As the new IPCC report notes, people are already suffering the “widespread and consequential” impacts of climate change. Around the globe, climate change is driving increased water risks, heat waves, and rising seas. Unless we change course, rural communities will face reduced fresh water resources, decimated forests, and disrupted food supplies. Climate impacts will also take their toll on urban dwellers, especially the poor who are at risk of rising seas and extreme weather events. For example, low-lying cities, like Mumbai and Kolkata, face significant threats from coastal flooding and storm surge.

The economic consequences will be severe as communities and businesses will need to cope with devastation to natural resources, as well as impacts to transport and infrastructure. One need only to think about Typhoon Haiyan in the Philippines or Hurricane Sandy in the United States to recognize the damage that extreme weather events can bring. Such extreme events take a disproportionate toll on the health and livelihoods of poor people and drive greater inequality of growth.

While the world has made remarkable progress on human development over the past several decades, climate change could undermine and even reverse these gains. As a recent report from the UN Development Programme explains, without further action “whatever progress we have made in poverty reduction or improvement of human development will just be erased due to climate change.”

Yet there are also opportunities at hand. Addressing the causes and consequences of climate change can reduce risks and even bring economic benefits. Indeed, climate change and economic development are inextricably linked, both in terms of the impacts and the responses that are possible. Smart policies and investments can both drive economic growth and lead to a safer world for people and the planet.

Embracing Clean and Affordable Energy

1.3 billion people worldwide, including 400 million in India, still lack access to electricity. Delivering these people energy is essential for them to have greater access to education, health services, and economic opportunity. But, as more people gain access to energy, it must be both low-carbon and affordable. The good news is that more clean energy can reduce emissions, drive climate resilience, and foster equitable economic growth.

One of the greatest opportunities lies in expanding renewable energy markets. Renewable power technologies now account for around half of all new power generation capacity worldwide. In India, analyses by KPMG and others find that solar energy may be cost competitive with conventional energy by 2018 or even sooner.

India’s National Action Plan on Climate Change (NAPCC) sets a target of attaining 15 percent of renewable energy generation by 2020 relative to 2008 output. Currently, 12 percent of the country’s energy mix is supplied by renewables, putting it on track to reach this goal. The NAPCC consists of 8 national missions, most of them targeted toward clean energy, including the National Solar Mission and the National Mission on Enhanced Energy Efficiency, which support efforts under the Electricity Act of 2003 and the Energy Conservation Act 0f 2001.

One innovative approach to expedite the shift to clean energy in India is the Green Power Market Development Group, a joint initiative of the Confederation of Indian Industry and World Resources Institute, that officially launched in 2013. GPMDG seeks to transform energy markets and enable corporate buyers to access reliable and clean energy, diversify their energy portfolios, and reduce emissions that drive climate change. Commercial and industrial companies in India, like Infosys, have supported the shift to green power purchasing and understand the energy security value of renewable energy.

As low-carbon energy technologies—such as solar photovoltaic, small-scale wind, hydro, and biogas—become cheaper and more efficient, the electricity needs in developing countries can be met.

Expanding renewable energy supply is only part of the solution. Increased energy efficiency also brings multiple benefits including reducing carbon emissions and lowering costs for consumers. McKinsey & Co. estimates that through energy efficiency and related measures India can avoid the need for 120 gigawatts of power capacity by 2030. Efficiency opportunities abound in buildings, appliances, and industry.

Of course, not all energy choices carry benefits for the economy and climate. Often there are real trade-offs that must be resolved. However, there is a growing recognition that typical cost-benefit analyses underestimate the benefits of climate action, while policy and investment options are available that can drive greater development and climate outcomes.

The Global Commission on the Economy and Climate, comprised of leaders in government, finance, and business from more than 14 countries, is currently overseeing an independent evaluation to find strategies to identify and scale those benefits. Supported by leading economists and researchers from seven top research organizations, including the World Resources Institute and the Indian Council for Research on International Economic Relations, the commission will release the New Climate Economy report in September 2014, revealing economic benefits of policies to tackle climate change.

However, the shift to clean energy is not happening quickly enough, and time is running short to keep the world within 2 degrees Celsius of global temperature rise, which is the level we must stay below to avoid the worst impacts of climate change.

Global Climate Action

With a greater sense of urgency, world leaders have the opportunity to step up and ensure resourceful, innovative, and climate-resilient strategies are in place. The next year-and-a-half will be critical to put in place the building blocks for a new universal climate agreement in Paris in 2015. Securing such an agreement that brings in all countries would greatly catalyze climate action at the international and national levels.

To help achieve this goal, WRI, together with several other international research organizations, recently launched a new effort to address some of the essential questions around the functions and substance of a 2015 climate deal. The group, called the Agreement for Climate Transformation 2015 (or ACT 2015), will engage in strategic conversations with governments and stakeholders to inform the direction of the agreement.

Clearly, there are many core issues that have to be addressed, not least the question of equity and what are the expectations for different countries. Both the potential actions and the constraints facing a country like India need to be recognized.

In addition, the international community needs to find ways to ensure financial flows and investment so that developing countries, like India, can tap their full potential. One important milestone is to finalize the operational framework for the Green Climate Fund, which has the potential to catalyze significant funds to support developing countries that are coping with climate impacts and adopting low-carbon pathways. Ensuring that the GCF is truly operational and has financial resources by the end of the year, along with scaling up additional climate funds are critical.

Building Momentum

Reaching a new climate deal will not be easy. But, if the world’s economic powerhouses—the United States, Europe, China, Japan, Brazil, and India—come to the table with strong commitments it would create much needed momentum. Last week, in a joint statement, the United States and European Union reaffirmed their intent to move toward a global climate agreement in Paris that would “be consistent with science and with the goal of limiting the global temperature increase to below 2°C.”

Leaders in India can likewise play a vital role in turning this vision into a reality. They can do so by pursuing policies that will bring together measurable benefits of climate action—both reducing emission and building resilience—with robust economic development.

Over the coming months, countries will have opportunities to demonstrate that they are serious about delivering on a strong climate agreement. In September, at the UN’s summit on climate change in New York City, world leaders can make clear commits that would benefit the climate and development. And, in the first quarter of 2015, countries will put their national offers on the table in the lead up to the international climate talks in Paris.

With the IPCC’s renewed warnings of mounting climate change fresh on our minds, it is clear that business-as-usual will not cut it. It’s time for action that will expedite the shift to clean energy and drive greater ambition into the climate talks. There are big pay-offs waiting down the road and in the short run as well.