The spatial politics of International Climate Finance: A case of India

Do political parties shape where International Climate Funds are allocated? We examine this question in the context of India, where International Climate Funds create opportunities for the central government to leverage externally funded resources to advance domestic political interests. Drawing on a novel geo-coded dataset of project locations from the Kyoto Protocol’s Clean Development Mechanism, we show that projects are more likely to be allocated to constituencies represented by co-partisans of the Prime Minister’s party, and that this effect is strongest in competitive constituencies within states governed by opposition parties, where the central government has the sharpest incentives to build new support. This is surprising because existing literature on the Clean Development Mechanism suggests that decisions on project allocations are depoliticized. By demonstrating otherwise, this article contributes to the literature on International Climate Funds by demonstrating the importance of domestic politics in shaping its distribution.