India’s (Green?) Union Budget

“The 2018 budget of Government of India has been silent on environment and climate change”

I gave my initial reaction to my Professor friend. We were sitting in his study having a masala chai and samosas for a change.

Professor heard me but didn’t react immediately as he was on the phone – (perhaps with the FM?). I knew that Professor was close to the FM and he must have had a hand in shaping the 2018 budget. I was therefore surprised that despite his proximity and influence on the FM, there was not much green in the budget that we all wanted to see.

I had a reason to expect this time a Green Union Budget. We know that economic indicators alone are no longer representative of the growth. How long can we continue to cheat? While India may claim a growth rate of 7 to 8%, its true GDP growth could be just about 5% due to poor management of our natural assets and payment to be made for the liabilities (e.g. contaminated lands) we have created. India is ranked today third from the bottom on the Environmental Performance Index, lower than nations such as Libya, Iraq, and Afghanistan.

The Economic Survey has projected loss of up to 25% in farm income highlighting the risks posed to due to climate change. Unfortunately, there has been no change in the allocations under the Climate Change Action Plan or the National CC Adaptation Fund. Its strange that at the same time, the government is expecting to double farmers’ income by 2022. And there is no place in the budget on the Intended Nationally Determined Contribution (INDC) as communicated in COP 21 in Paris.

Poor air quality in New Delhi has drawn international attention. The situation is however no different across most Indian cities.  The Government has been steadily “diluting” the environmental governance. For instance, the old emission norms for thermal plants are allowed to continue for the next five years. Provisions like Environmental Supplement Plan (ESP) have legitimized non-compliance. Several conditions have been relaxed while obtaining Environmental Clearance (EC). Two crucial economic instruments – the National Clean Energy and Environment Fund (reportedly over Rs 56,700 crore) and the Water Cess — have already been dissolved for the sake of accommodating the concerns of the States on GST.

Professor had put the phone down. He looked at my agitated face and smiled. He said “You haven’t really understood the budget Dr Modak. There is a lot of green there – but you need a lens if you want to see. Let me explain”. He lit his cigar.

“The Centre has announced a ₹1.4 lakh-crore scheme for promoting decentralized solar power production of up to 28,250 MW to help farmers. We will spend ₹48,000 crore on the ten-year scheme called Kisan Urja Suraksha evam Utthaan Mahaabhiyan or KUSUM. KUSUM would provide extra income to farmers, by giving them an option to sell additional power to the grid through solar power projects set up on their barren lands. Farmers will thus be empowered and become entrepreneurs.

Now see the environmental perspective. KUSUM will de-dieselise the energy sector as also the DISCOMS. India had about 30 million farm pumps that include 10 million pumps running on diesel. Just think about the massive reduction in the GHG emissions. As solar pumps will operate for only 8 hours, excess withdrawal of the groundwater will be curbed and thus the groundwater table will improve and provide water security to farmers”

I thought the Professor was right. You need to think more to understand the green perspective and massive implication of KUSUM to the environment, empowerment and social development.

“What about the Operation Greens?” I asked Professor.

“I told FM to build Operations Greens in line with the Operation Flood and allocate 500 crores. But to me Operations Green is a climate adaptation strategy” Professor said.

“Operation Greens aims to promote farmer producers’ organisations, agri-logistics, processing facilities and professional management. Operation Greens will work to increase demand in the economy. As many as 470 Agriculture Promotion Market Committee promoted markets will now be connected to the e-nam platform while the government will help in development of 22,000 agricultural markets.

The Operation aims to aid farmers and help control and limit the erratic fluctuations in the prices of commodities like onions, potatoes and tomatoes. Operation Greens has a price fixation scheme that aims to ensure farmers are given the right price for their produce. The Minimum Support Price (MSP) regulation has a key role to play here. The announcement to set MSP of all kharif crops at 1.5 times the cost of production will increase the farmers’ income. In addition, the Budget’s rural sops such as MNREGA allocation being increased from Rs 38,500 crore to 48,000 crore, the coverage of ‘Fasal Bima Yojna‘ being increased from 30 per cent to 40 per cent etc, will definitely serve to address climate change related risks. Operations Greens is thus essentially an adaptation strategy to address the risks of climate change and make our agriculture sector climate resilient.”

“Oh, how clever of the FM” I thought. I was sure that our MoEFCC must have crafted this strategy in partnership with the Niti Ayog. No wonder the Ministry was christened as MoEF and Climate Change.

Professor continued. “Yes, we sacrificed the National Clean Energy and Environment Fund to accommodate disadvantage to the State on account of GST, but we have now set up a special scheme to address air pollution in Delhi- NCR region. You are aware, due to burning of paddy fields after harvesting by farmers mainly from north India, the resultant smoke gets carried by winds to Delhi and beyond, adding to the existing Suspended Particulate Matter (SPM) and other noxious substances that affect the lungs.

To combat this problem, a special scheme will be executed with Delhi government and adjoining states where steps will be taken to subsidize the machinery required for management of crop residue. Instead of heavy penalties for burning agricultural waste, we are providing incentives to the farmers to make them more productive, albeit limited to the NCR.  And remember Dr Modak, I don’t need to explain that stopping burning of crop residues in this innovative manner will greatly reduce emissions of GHG.

Professor had another example to cite

“In an effort to make the villages open defecation free and improving the lives of villagers, the FM has announced the launch of the Gobar Dhan scheme. The Gobar Dhan scheme will manage and convert cattle dung and solid waste in farms to compost, biogas and bio-CNG. Understand the massive reduction in GHG emissions expected due to this project through waste utilization, fossil fuel substitution while promoting clean energy. We are confident that we will be able to achieve targets set in the INDC just by implementing the Gobar Dhan scheme.

I was now impressed. I wished that FM had spoken about these environmental benefits explicitly and silenced the environmental NGOs and critiques.

But I still had questions to ask.

“What about the Sustainable Development Goals (SDGs) Professor? There is no mention on the SDGs in the Union Budget.”

Professor was perhaps expecting my question

“You would notice in the budget that the government had identified 115 districts taking various indices of development into consideration, aiming at improving the quality of life in these districts by investing in social services like health, education, nutrition, skill up-gradation, financial inclusion and infrastructure like irrigation, rural electrification, potable drinking water and access to toilets at an accelerated pace and in a time bound manner. All these indicators can be mapped to the 17 SDGs. These 115 districts are expected to become models of sustainable development and help track the progress towards SDGs”

I liked this pilot approach of working with 115 districts out of the 600+ that we have and test progress towards the SDGs.

Professor extinguished his cigar.

“Sorry, Dr Modak, I have to now rush to the North block. FM has called. He wants me to rewrite his Budget speech – now in Green script – giving all the environmental implications of the economic measures he is proposing.  He feels this communication is needed to make people understand that this Government is deeply concerned about environment and sustainable development. I had warned him before, but he did not get my point then”

Now I understood why the FM quoted Swami Vivekananda in his budget speech and had said, “You merge yourself in the void and disappear and let a new India arise.” What a deep and loaded quote!

On my way home however, I realized that I wasn’t fully convinced. I wasn’t very comfortable about Professors impressive green interpretation of the budget. Was the green interpreted budget going to be a usual marketing green-wash, full of voids, less of substance and not a true commitment.

Well, I leave to you to decide. Professor could well be right! And a new India may arise!!


You may like to create an assignment for graduate students to study India’s Union Budget and rewrite its “green version” with application of some metrics. Students may examine to what extent the budget reflects (of course “untentionaly”) the INDC and the SDGs and do a discussion.


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