Indian Economy, 5th edition (93 page)
Read Indian Economy, 5th edition Online
Authors: Ramesh Singh
INTRODUCTION
Improving living standards for mankind has been the single minded goal of all nations and world bodies. After defining development in numerous ways for over two decades, there seems to be a consensus on ‘Human Development’. While a large popnlation on the earth is still to get the ‘bare minimum’ for development, humanity is at the crossroads where it is faced with the first of its kind challenge – the challenge of ‘climate change’. The dilemma is that whatever we can do for our development, there has to be a repercussion on nature. An even bigger dilemma is in achieving a global consensus on how to check or restrict and finally reverse the process of climate change.
We may consider the year 2012, arguably, a high water mark in the field of environment and sustainable development initiatives. The global community met at the
UN Conference on Sustainable Development
that took place in
Rio
in June 2012, also marking the 20th anniversary of the first Earth Summit held in 1992. The Conference reviewed the progress made, identified implementation gaps, and assessed new and emerging challenges, which resulted in a political outcome called the
‘The Future We Want’
. In India, the Twelfth Five Year Plan was launched with a focus on sustainable growth. This along with sustainable development policies and programmes which are being followed signalled to citizens at home and the world at large that India is committed to sustainable development with equal emphasis on its three dimensions - social, economic, and environmental.
A survey of the global comparative opinion shows that people in India and indeed all countries, have a marked and rising concern about sustainable development and climate change
(cited by the Economic Survey 2012-13)
. However, the challenges are also formidable, especially in the context of finding the matching resources of the required magnitude given the economic conditions. Climate science has rightly taken up an important position in the public debate. Even as the science of climate change grapples with uncertainties, the world is witnessing more extreme events. The urgency for action is felt more than ever before. In contrast, though the Doha, Gateway on climate change in December 2012 agreed upon a multilateral and rule-based regime to reduce emissions, the emission pledges on the table by the developed countries lacked ambition. Now the Fifth Assessment Report of the Inter-governmental Panel on Climate Change (IPCC) is in the final stages of completion. With rising extreme events, and rising citizen demand, the world has little option but to listen to the voice of evolving science and respond adequately with strategies and policy rooted in the principles of multilateralism with equitable and fair burden sharing.
1
The
Economic Survey 2011-12,
for the first time, introduced a new chapter the ‘Sustainable Development and Climate Change’. These topics remained headline news with extreme weather events both at home and abroad. Efforts to arrive at a consensus on what to do at home and abroad gathered momentum, even as they sailed through some rough waters and fickle seas in many respects. In 2012, science and nature voiced a sense of urgency for action. Yet the relevant statistics have a mixed story to tell. It strongly accepts science but weakly reflects on the corresponding multilateral actions, suggesting that a lot remains to be done on the latter. Till the world stops to introspects and accepts that we are a product of the ecological surrounding we are living in, there seems no durable outcome from the international deliberations.
Climate Change at a Glance
Since the industrial revolution, manmade activities have added significant quantities of greenhouse gases (GHG)
2
into the atmosphere. Climate change is a global negative externality primarily caused by the building up of GHG emissions in the atmosphere. The efforts needed to address the climate change include mitigation of GHG emissions on the one hand, and building of adaptive capacities to cope with the adverse impacts of climate change on the other. From a developing country perspective, adaptation is of utmost importance as they are the ones who are most vulnerable to the adverse impacts of climate change.
The incremental impact of a ton of GHG on climate change is independent of where in the world it is emitted. These emissions impose a cost on both the present and future generations, which are not fully recouped from the emitters of these emissions. This formed the starting point for a globally coordinated policy action and the need for an international climate change negotiating regime. UNFCCC, set up in 1992, although global in scope, differentiates the commitments/responsibilities of Parties on the basis of historic responsibilities, economic structures, and on the basis of the principle of ‘equity’ and CBDR which is at the core of the climate change debate.
The largest share of historical and current global emissions of GHGs has originated in developed countries. Scientists attribute the global problem of climate change not to the current of GHG emissions but to the stock of historical GHG emissions. Most of the countries, particularly the industrialised countries, having large current emissions are also the largest historic emitters and the principal contributors to climate change. The Convention therefore lays down legally binding commitments for the developed countries, taking into account their historical responsibilities and also squarely puts the responsibilities on developed countries for providing financial resources, including for the transfer of technology, needed by the developing countries. The Convention also acknowledges that climate change actions taken by developing countries are contingent on the resources made available to them.
A volatile mix of erratic weather, natural disasters, and enormous pressure on the availability of clean air, water, and energy together with the problems of poverty and hunger continues to be of great concern for policymakers particularly in the developing countries. There was building of the forward momentum both globally and domestically with three high-profile events in the global arena in 2012 and launch of the Twelfth Five Year Plan at home. The Earth Summit in Rio also popularly known as Rio + 20 celebrated its 20th anniversary, next the 11th session of the Conference of Parties (
COP 11
) to the Convention on Bio Diversity (CBD), hosted by India in Hyderabad, and finally the year closed with the 18th session of the COP to the United Nations Framework Convention on Climate Change (UNFCCC) in
Doha
in December. These international collaborations came out with balanced packages though short on ambition but proceeding on efforts. At home, we launched the Twelfth Five Year Plan whose explicit theme was a ‘faster, more inclusive and sustainable growth’ process. It is the first time that a five year plan has sustainability as a prominent focus. The Twelfth Plan outlined lower carbon growth strategies adding momentum to the ongoing policies and programmes of the government on environment and climate change. To add to this, State Action Plans on Climate Change (SAPCC), a recent initiative, will tune national initiatives on the National Action Plan on Climate Change (NAPCC) to regional, socio- economic and ecological conditions. The SAPCC is expected to take off as part of the plan scheme for states. With these developments, it is clear that sustainable development and climate change issues are being addressed on a priority basis.
The world population crossed the 7 billion mark but with continued decline in population growth rates. Urbanisation continues to grow with more demand for resources. A United Nations Environment Programme (UNEP) study,
‘Keeping Track of Our Changing Environment: From Rio to Rio + 20 (1992- 2012)’
, tells the story of where the world collectively stands today on the sustainability and environment front. According to this study, both global gross domestic product (GDP) and the human development index (HDI increased by 2.5 per cent per year) continue to increase but variation and inequalities between regions still exist. The study also points to the growing pressure on agriculture, water, fisheries, and land resources. Pressure on natural resources reflected in per capita global use of natural resource materials has increased around 27 per cent between 1992 and 2005 though there has been a decline in emissions and energy and material use per unit of output, indicating improvement in efficiency levels. At the same time, global greenhouse gas (GHG) emissions have continuously been rising. GHG emissions measured in
MtCO
2
e
(million metric tons of CO
2
equivalent) from 1990 to 2005 register an increase of 25.9 per cent
(World Resources Institute).
Positive and rising trends in global efforts are competing against mixed trends.In 2011, global investment in the renewable energy sector, went up 17 per cent to $257 billion hitting another record. In terms of new capacity added in 2011, renewable power (excluding large hydro Electrical project) accounted for 44 per cent of the total new generation capacity added worldwide; up from 34 per cent in 2010 (Frankfurt School of Finance and Management ‘Global Trends in Renewable Energy investment 2012’).The global community is now working upon a set of Sustainable Development Goals (SDGs) possibly to be integrated with Millennium Development Goals (MDGs) for the post 2015 global policy architecture. Simultaneously the world in the past decade has entered into many new environmental agreements. Along with the governments also the private sector has been forthcoming. However, multilateral and bilateral funding dedicated to environmental purposes fluctuated and was faced with unmet promises to a great extent.
Sustainable Development and Climate Change in the Indian Context
In the past two decades, the key environmental challenges in India have been sharper.
The State of the Environment Report
by the MoEF clubs the issues under five key challenges faced by India –
1.
Climate Change,
2.
Food Security,
3.
Water Security,
4.
Energy Security, and
5.
Managing Urbanisation.
Climate change is disturbing the natural ecosystems and is expected to have substantial adverse effects in India, mainly on agriculture (on which 58 per cent of the population still depends for livelihood), water storage in the Himalayan glaciers which are the source of major rivers and groundwater recharge, sea-level rise, and threats to a long coastline and habitations. Climate change will also cause increased frequency of extreme events such as floods, and droughts. These in turn will impact India’s food security problems and water security. As per the
Second National Communication
submitted by India to the UNFCCC, it is projected that the annual mean surface air temperature rise by the end of the century ranges from
3.5
0
C to 4.3
0
C,
whereas the sea level along the Indian coast has been rising at the rate of about
1.3 mm/year
on an average. These climate change projections are likely to impact human health, agriculture, water resources, natural ecosystems, and biodiversity.
SAPCC (State Action Plans on Climate Change)
After the NAPCC was launched
3
, there have been serious efforts to dovetail national programmes of action to regional and local levels consistent with varying socio-economic and ecological conditions. At the Conference of State Environment Ministers held on 18 August 2009, the Prime Minister of India requested all state governments to prepare SAPCCs. The State Action Plans took their lead from National Mission documents while formulating mitigation/ adaptation strategies. So far, 21 states have prepared documents on the SAPCC focused on approaches that are sectoral but with regional ramifications. The State Action Plans include strategies and a list of possible sectoral actions that would help the states achieve their adaptation and mitigation objectives. The common threads that bind these State Plans together are the principles of territorial approach to climate change, sub-national planning, building capacities for vulnerability assessment, and identifying investment opportunities based on state priorities. This framework provides a broad, systematic, and step-wise process for the preparation of SAPCCs and advocates a participatory approach so that states have enough ownership of the process and final plan. The major sectors for which adaptation strategies envisaged are agriculture, water, forests, coastal zone, and health.
Concerned of the threats imposed by climate change and pressures on natural resources, sustainability and environment are increasingly taking centrestage in the Indian policy domain. India has been part of 94 multilateral environmental agreements. India has also voluntarily agreed to reduce its emission intensity of its GDP by 20-25 per cent over 2005 levels by 2020, and emissions from the agriculture sector would not form part of the assessment of its emissions intensity. Indian economy is already moving along a lower carbon and sustainable path in terms of declining carbon intensity of its GDP which is expected to fall further through lower carbon strategies. It is estimated that India’s per capita emission in 2031 will still be lower than the global per capita emission in 2005 (in 2031, India’s per capita GHG emissions will be under 4 tonnes of carbon dioxide equivalent (CO 2 eq.) which is lower than the global per capita emissions of 4.22 tonnes of CO
2
eq. in 2005).
Together with the national efforts in different sectors, India also recognises that rural areas are equally prone to stress and pressures from natural resource exploitation. In this context, schemes for rural development and livelihood programmes are very relevant. A vast majority of the works under the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) are linked to land, soil, and water. There are also programmes for non- timber forest produce-based livelihood, promotion of organic and low-chemical agriculture, and increased soil health and fertility to sustain agriculture-based livelihoods. These schemes help mobilise and develop capacities of community institutions to utilise natural resources in a sustainable manner and their potential can be further developed.