WB cautions India over environmental damage

World Bank puts total cost of environmental degradation in India at 5.7% of GDP in 2009, which is less than China’s 9% and Pakistan’s 6%. If it had also considered damages due to large dams that affect scarce resources in addition to human costs, the value would go beyond 15% of GDP and upset rate of growth of economy in real terms..

Economists have been considering the relationship between climatic change and its effect on GDP quite for some time. The recent debate on environmental issues in the country, therefore, could be reflected upon with reference to a publication of the World Bank – India: Diagnostic Assessment of Environmental Challenges 2013. If we read the report and relate the findings to the political economy of development process and the drama in the Paryavaran Bhavan in Delhi where more than Rs 1.5 lakh crores worth pending projects are reported to have been cleared in days, we would know what is in store for India. That doesn’t mean all the projects are bad, but some are helpful to a small number, and quite a few may be fatal to all in the long run.

Economists who analyse data and presage the society have been considered as pessimists from the time of Malthus. Yet, there are sane policy-makers and people’s representatives and even civil society organisations like the Club of Rome who have taken the sage advice of the experts serious. There is no doubt that exceptional individuals might believe in the tautology that nothing is created from the unknown and all that happens in the universe is only a change from one element to the other. This way, humans are neither capable of changing the quantity of water available nor can influence the climate. Thus, they might say, we need not bother about the negative propaganda and should open-heartedly invite all developmental projects. If someone conveys the death toll or displacements due to the adverse effects of the projects, certain of them might say that after all human beings must ultimately make over as the five elements in universe – why do you bother now. However, as mundane beings we cannot ignore our immediate present.

Let us examine the results of the study on environmental damages in India as estimated by the World Bank. The loss of life as a result of pollution has shown that the strongest association with the health endpoints is particulate matter and other secondary particles with similar characteristics of less than 10 microns in diameter (PMIO). The focus of this report, therefore, is the health effects of all fine particulates (PM1Oand PM2.5) since they are regarded as criteria pollutants and include components of other pollutants. They are an important cause of cardiovascular and pulmonary diseases, lung cancer and morbidity in the population. This requires data on who is exposed, health impacts of that exposure and value attached to those impacts. Given data limitations, the Bank has said, “we can only estimate impacts for the urban populations and in fact only for a part of that population. Only major cities have TSP and PM1O monitoring data. TSP or total suspended particles is a regulatory measure of mass concentration of particulate matter (PM) in community air.

In this study, we focus on cities with a population of 1,00,000 and above only. Since the baseline population is from the 2001 census, there are many cities that have achieved population of 1,00,000 since 2001 and have not been included in the study.

Pollution data for all cities, where available, was taken from the Central Pollution Control Board's (CPCB) Environmental Data Bank website for the year 2008. Health damage estimates for PM1O were calculated based on observations for the year 2008. The study included 96 cities with monitoring stations and 223 cities with no monitoring stations – 254 million people in total – relating to 16 per cent of the population. Interestingly, the most polluted city in terms of PM10 average per annum (Ug/m3), Meerut at 313, and Delhi at the rank 6 with a value of 214 are above Andhra cities. Vijayawada at 96, Ramagundam at 87, Hyderabad at 84 and Visakhapatnam at 81 appear to be not as much polluted as Delhi. It may be due to the fact that the ICT (in Hyderabad) does not load with pollutants except the vehicles used by the wage earners and might have other kinds of pollutions that are not yet considered as environmental damages. The report has considered six categories of damages and estimated the costs involved. They are: outdoor air pollution, indoor air pollution, crop lands degradation, water supply, sanitation and hygiene, pastures degradation and forest degradation. We have taken the mid-point estimate and noted that it stands at Rs 3,751 billion per annum.

The sub-categories are: Outdoor air pollution (Rs 1,100 billion); Indoor air pollution (Rs 870 billion); Crop lands degradation (Rs 703 billion); Water supply, sanitation and hygiene (Rs 540 billion); Pastures degradation (Rs 405 billion); and Forest degradation (Rs 133 billion).

It is found that the total cost of environmental degradation in India is equivalent to 5.7 percent of GDP in 2009, which is the reference year for most of the damage estimates. It is, however, lower than that in China (9%) and Pakistan (6%). In fact, the higher side of the estimate at Rs 5,821 billion (Rs 5.8 lakh cr) is more than 10 per cent of GDP (almost equal to the revenue of Union Government) and seems to be close to reality. The report has estimated health-related damages based on human capital approach that takes into consideration earnings foregone or loss of income taken at Rs 150 for urban and Rs 60-75 for rural areas per day are lower in value, and are not based on facts. The survey of the World Bank relied heavily on NFHS (National Family Health Survey), NSS (National Sample Survey) and other secondary sources further reduced the values that are adjusted for the expected value at 2010. In other words, the value of life calculated at around Rs 1.5 crore per person seems to be low-priced. In addition to the constraints recognised by the report, we have noticed that they have not included the costs of loss or damage of the ecosystems such as grass lands, wetlands, mangroves and coral reefs. In fact, the report has assessed the value of service of this category of natural resources at Rs 1.8 lakh crores per year, but did not mention the damages inflicted.

It seems the report has avoided considering damages due to the construction of major dams that affect the above scarce resources in addition to the human costs. The loss of livelihoods of adivasis, fisher folk, poor and social costs of uprooted communities in ecosystems was not reflected. If the cost of all kinds of environmental damages is considered here, the value goes beyond 15 per cent of GDP and upset the rate of growth of the economy in real terms.It is estimated that India has released 2 billion tonnes of Co2 in 2012 and is the fourth largest polluter in the World. However, the report has not provided any mitigation solutions, except indicating alternative models of growth to incentivise private sector. Does the report, indeed, help the government implement projects that carry heavy loads of environmental damages?

(chalamks@hotmail.com)