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July 14, 2020

Development Strategy|Natural Resources

Nature in Peril

By Nitin Desai






Nature can protect us only if we protect it-that is the simple truth this  government needs to recognise.


The environment in India faces a unique challenge. The ministry charged with protecting it seems to be more keen on helping to promote activities that are likely to damage it. We have seen this in the transformation of the National Wildlife Board into a bureaucrat dominated rubber stamp that has approved practically all industrial projects submitted to it for approval.  The Forest Conservation Act has been bypassed to allow railway lines and other projects through protected areas. The Expert Appraisal Committee is being made to meet online in a lockdown environment where affected people cannot make representations nor can the experts visit the affected areas.


In the governmental decision making system there are always competing pressures and the direction of the actual outcome depends on who is pulling how hard in the parallelogram of force. The dharma of the Ministry of Environment, Forests and Climate Change (MOEFCC) is to pull hard to conserve natural resources and protect the environment to counter the reverse pressure from the sectoral ministries whose primary interest is quick increases in production. For it to abandon this dharma is a bit like a ministry for the advancement of women supporting traditional patriarchal practices or a ministry for child welfare arguing for legalising child labour.


The net consequence of a weak willed environment ministry is the steady deterioration in our environment with immediate  problems like worsening air quality and longer-term challenges of resource deterioration and environmental risks becoming more intractable. One measure of India's failure on the environmental front is its standing in Yale University's Environmental Performance Index. In the index released in 2020 India was 168 out of 180, down from 155 out of 178 in 2014. In the 2020 index  all South Asian countries other than Afghanistan were ahead of it. This corroborates the many concerns that activists have expressed about the steady dilution of environmental scrutiny in the Ministry of Environment, Forests and Climate Change. (MOEFCC)


The most recent example of this is the proposal to dilute the Environment Impact Assessment (EIA) Notification which has been put out for comments by the MOEFCC.  The current EIA Notification passed in 2006 puts all projects into two broad categories - category A which are subject to scrutiny and approval by the Central Government and category B where the responsibility rests with the State Governments. This second category was further subdivided into B1 which required prior scrutiny and approval and B2 which only required a filing of impact assessments, with States being left with the discretion to decide the criteria for placing projects in these two categories. This provision is being used to dilute the EIA requirement by placing more and more categories of projects, including several which are known to be very polluting, in the B2 basket and limiting the public consultation requirement. What is worse the revision includes a proposal to give post-facto approval to projects which evaded and violated the EIA guidelines provided they pay a modest fine.


Is this being done because of a naive perception that environmental protection is a hindrance to growth? That is not true if growth is correctly defined. Growth is not just expansion in the availability of produced goods and services. Growth is the increase in wealth, where wealth is defined to include not just the land, equipment and other items shown as assets in company accounts but also includes the human capital and natural capital.


All this has been lucidly explained in a regrettably mothballed report.  Green National Account’s in India, A Framework[1] prepared by an expert group convened by the National Statistical Commission and chaired by Prof.Partha Dasgupta, Emeritus Frank Ramsey Professor of Economics at Cambridge University, UK who is the leading resource and environment economist in the world today and whose intellectual elegance is manifest in the report. (Disclosure: I was a member of the expert group). A few quotations from this outstanding report will explain this point further:

  • “Economic evaluation requires data, to be sure, but it also requires a conception of the good. More tellingly, without a conception of the good we wouldn't know what data we should seek to study.”
  • “... the coin on the basis of which economic evaluation should be conducted is a comprehensive notion of wealth...comprising (i) reproducible capital (commonly known as "manufactured capital": roads, ports, cables, buildings, machinery, equipment, and so forth), (ii) human capital (population size and composition, education, health), and (iii) natural capital (ecosystems, land, sub-soil resources, and so on).”
  • “(The) PDV (Present Discounted Value) of the flow of social profits arising from an investment project is positive if and only if the project gives rise to an increase in wealth.”
  • “To leave a forest unmolested so as to enable it to grow would be to invest in it. To allow a fishery to restock under natural conditions would be to invest in the fishery.”


Is environmental protection a hindrance for profit seeking businesses? Not if these businesses have a long term vision of their viability. Any rational business will always be concerned about conserving the resources on which its own activities depend. It will seek to minimise the adverse impact of its activities on local, national and global environment if required to do so by regulations or if is concerned about its image in the eyes of a  customer base or clientele that is  increasingly sensitive to environmental impact. One could even argue that businesses with a long term vision of viability running into decades may be even more sensitive to environmental challenges than election oriented governments concerned mainly about short term impacts. The real pressure for diluting environmental scrutiny cones from hit-and-run businesses that are looking for quick profits rather than long-term sustainability. 


How can one reverse this slide? The protests by activists, muted because the lockdown prevents any large gathering, will have little impact on a ministry that has ignored them for so long. The only hope is that some enlightened business persons will speak up and point out that this dilution of prior environmental scrutiny is not in the long-term interest of development.


We are a densely populated country and we need the protection given to us by  coastal mangroves, green cover that gives  cleaner air, ample flows in our rivers that keeps water cleaner and other natural capital. As the risks of adverse weather event increases with climate change we will need this protection even more. But nature can protect us only we protect it - prakriti rakshati rakshita. That is the simple truth this government needs to recognise.



[1] Green National Accounts in India A Framework: A Report by an Expert Group Convened  by the National Statistical Organization Ministry of Statistics and Programme Implementation Government of India, March 2013



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