The environment we are in
Thursday, February 19th, 2009Indians have long admired China’s growth from afar, envying the highways, mass transit systems, airports and entire new metropolises that they manage to build in the time it takes us to get a few flyovers going.
However, China’s growth does point to many untapped possibilities. In terms of the environment, China has done little more than follow the carbon-intensive growth pattern of the West, one that India has also referred. The consequences of this in a population-heavy country is already apparent in China, since they are ahead of us in the development curve: its cities suffer massive air pollution, such that the sun frequently disappears behind the smog; an entire village vanishes under sludge; the country is facing intense water shortages, and has seen development projects like the Three Gorges Dam turn into environmental catastrophes.
India - another populous country - ought to take our lessons from this. Besides an ‘environment-inclusive’ approach to growth brings with it both advantage and opportunity. Its undeniable that putting a cost on the environment would have short-term negative effects on the economy, since we would be pricing something that was once free. When policy makers talk about pricing the environment, they usually mean pricing carbon, since carbon is present in the entire cycle - air, water (which absorbs carbon), soil (which can both absorb carbon, and release it when degraded), forests (which absorb carbon in their growth phase). With carbon prices to consider, industries would have to budget for their factory emissions, for any pollutants that contaminate water, and degrade land and forests. This would bring down revenues and profits, and slow industry growth.
But in the longer term, I believe the benefits to GDP growth would be immense, simply because we would be using all of our resources more efficiently. Waste would be managed better, and whole industries will emerge around waste management, recycling and alternative energy use.
Besides, we are already paying for polluting our natural resources - except the cost is being disproportionately paid by the people who have lived closest to nature - the poor, the forest tribals, the farmers. Our farmers struggle with droughts and floods, and falling groundwater tables as well as degraded soil are bringing down harvest yields and income. Declining forests have hurt the livelihoods of the villages and tribes that depend on them. When common water sources are contaminated, its a select few who are able to pay for access to clean water. Pricing the environment would mean sharing the burden of such pollution more equitably. It would be a shift to a fairer economy, and one with greater accountability.


