National Environment Policy-2004

Preamble

A diverse developing society such as ours provides numerous challenges in the economic, social, political, cultural, and environmental arenas. All of these coalesce in the dominant imperative of alleviation of mass poverty, reckoned in the multiple dimensions of livelihood security, health care, education, empowerment of the disadvantaged, and elimination of gender disparities.

The present national policies for environmental management are contained in the National Forest Policy, 1988, the National Conservation Strategy and Policy Statement on Environment and Development, 1992; and a Policy Statement on Abatement of Pollution, 1992. Some sector policies such as the National Water Policy, 2002, have also contributed towards environmental management. Despite these policy documents a need for a comprehensive policy statement has been evident for some time in order to infuse a common approach to the various sectoral, cross -sectoral, including fiscal, approaches to environmental management. As our development challenges have evolved, and our understanding of the centrality of environmental concerns in development has sharpened, there is also a need to review the earlier objectives, policy instruments, and strategies.

This dynamic requires an evolving and flexible policy framework with a built in system for monitoring and review, and where necessary, revision. Sustainable development concerns in the sense of enhancement of human well-being , broadly conceived,2 are a recurring theme in India’s development philosophy. For this to occur, there is a need for balance and harmony between economic, social and environmental needs of the country.3 India also plays an important role in several significant international initiatives concerned with the environment. It is a party to the key multilateral agreements, and recognises the interdependencies among, and transboundary character of, several environmental problems.

The National Environment Policy (NEP, 2004) is a response to our national commitment to a clean environment, mandated in the Constitution in Articles 48 A and 51 A (g), strengthened by judicial interpretation of Article 21. It is recognised that maintaining a healthy environment is not the state’s responsibility alone, but also that of every citizen. A spirit of partnership should thus be realized throughout the spectrum of environmental management in the country. While the state must galvanise its efforts, there should also be recognition by each individual – natural or institutional, of its responsibility towards maintaining and enhancing the quality of the environment. The NEP, 2004 is also intended to be a statement of India’s commitment to making a positive contribution to international efforts.

The NEP, 2004 has been motivated by the above considerations and is intended to mainstream environmental concerns in all development activities. It briefly describes the key environmental challenges currently and prospectively facing the country, the objectives of environment policy, normative principles underlying policy action, strategic themes for intervention, broad indications of the legislative and institutional development needed to accomplish the strategic themes, and mechanisms for implementation and review. It has been prepared through a process of extensive consultation with experts, as well as diverse stakeholders, and this process is also documented.

The NEP, 2004 is intended to be a guide to action: in regulatory reform, programmes and projects for environmental conservation; and review and enactment of legislation, by agencies of the Central, State, and Local Governments. It also seeks to stimulate partnerships of different stakeholders, i.e. public agencies, local communities, the investment community, and international development partners, in harnessing their respective resources and strengths for environmental management. On the whole, it is expected to do better than fiscal neutrality, and likely raise substantial resources from outside the fiscal regime to realize its objectives.

The key environmental challenges that the country faces relate to the nexus of environmental degradation with poverty in its many dimensions , and economic growth. These challenges are intrinsically connected with the state of environmental resources, such as land, water, air and their flora and fauna. The proximate drivers of environmental degradation are population growth, technology and consumption choices, and poverty, leading to changes in relations between people and ecosystems, and development activities such as intensive agriculture, polluting industry, and unplanned urbanisation. However, these factors give rise to environmental degradation only through deeper causal linkages, in particular institutional failures, resulting in lack of clarity or enforcement of rights of access and use of environmental resources, polic ies which provide disincentives for environmental conservation (and which may have origins in the fiscal regime), market failures, (which may be linked to shortcomings in the regulatory regimes), and governance constraints .

Environmental degradation is a major causal factor in enhancing and perpetuating poverty, particularly among the rural poor, when such degradation impacts soil fertility, quantity and quality of freshwater, air quality, forests, and fisheries. The dependence of the rural poor, in particular, tribal societies on their natural resources, especially biodiversity, is self-evident. The poor are particularly vulnerable to loss of resilience in ecosystems .4 Large reductions in resilience may mean that the ecosystems, on which livelihoods are based, break down, causing distress. The loss of the environmental resource base can result in certain groups of people being made destitute, even if overall, the economy shows strong growth. Further, urban environmental degradation, through lack of (or inappropriate) waste treatment and sanitation, industry and transport related pollution, adversely impacts air, water, and soil quality, and differentially impacts the health of the urban poor. This, in turn, affects their capability to seek and retain employment, attend school, and enhances gender inequalities5, all of which perpetuate poverty.

Poverty itself can accentuate environmental degradation, given that institutional6 failures persist. For the poor, several environmental resources are complementary in production and consumption to other commodities (e.g. water in relation to agricultural production, fuel-wood in relation to consumption of food), while a number of environmental resources are a source of income or food (e.g. fisheries, non-timber forest produce). This is frequently a source of cumulative causation, where poverty, gender inequalities, and environmental degradation mutually reinforce each other. Poverty and environmental degradation are also reinforced by and linked to population growth, which in turn, depends on a complex interaction of diverse causal factors and stages of development.

Economic growth, in its turn, bears a dichotomous relationship to environmental degradation. On the one hand, growth may result in “excessive” environmental degradation through use of natural resources and generation of pollution aggravated by institutional failures. If impacts on the environmental resource base are neglected, an incorrect picture is obtained from conventional monetary estimates of national income. On the other hand, economic growth permits improvement in environmental quality by making available the necessary resources for environmental investments and generating societal pressures for improved environmental behaviour and institutional and policy change.

It is increasingly evident that poor environmental quality has adversely affected human health. Environmental factors are estimated as being responsible in some cases for nearly 20 percent of the burden of disease in India7 and a number of environment-health factors are closely linked with dimensions of poverty (e.g. malnutrition, lack of access to clean energy and water). It has been established that interventions targeted at environmental management – e.g. reducing indoor air pollution, protecting sources of safe drinking water, sanitation measures, improved public health governance – offer tremendous opportunities in reducing the incidence of a number of critical health problems. It is also evident that these environmental protection measures would be difficult to accomplish without extensive awareness raising and education.

Institutional failures, referring to unclear or insufficiently enforced rights of access to and use of environmental resources , result in environmental degradation because third parties primarily experience impacts of such degradation, without cost to the agents responsible for the damage. Such rights – both community based and individual - are critical institutions mediating the relationships between humans and the use of the environment. Traditionally, village commons – water sources, grazing grounds, local forests, fisheries, etc., have been protected by local communities from overexploitation through various norms, which may include penalties for disallowed behaviour. These norms, may, however, be degraded through the very process of development, including urbanization, and population growth resulting from sharp reductions in mortality, and also through state actions which may create conditions for the strengthening of individual over communitarian rights and in doing so allow market forces to press for change that has adverse environmental implications. If such access to the community resources under weakened norms continue the resources would be degraded, and the livelihoods of the community would suffer.

Policy failures can emerge from various sources, including the use of fiscal instruments, such as explicit and implicit subsidies for the use of various resources, which provide incentives for excessive use of natural resources. Inappropriate policy can also lead to changes in commonly managed systems, with adverse environmental outcomes.

Another major set of challenges arise from emerging global environmental concerns such as climate change, stratospheric ozone depletion, and biodiversity loss. The key is to operationalize the principle of common but differentiated responsibility of countries in relation to these problems. Multilateral regimes and programmes responding to these global environmental issues must not adversely impact the development opportunities of developing countries . Further, the sharing of global natural resources must proceed only on the basis of equal sharing per-capita across all countries.

The causes, proximate and deeper, of degradation of key environmental resources are discussed below (Sec. 5.2).

The principal objectives of this policy are enumerated below. These objectives relate to current perceptions of key environmental challenges. They may, accordingly, evolve over time:

i. Conservation of Critical Environmental Resources:

To protect and conserve critical ecological systems and resources, and invaluable natural and man-made heritage which are essential for lifesupport, livelihoods, economic growth, and a broad conception of human well-being .

ii. Intra-generational Equity: Livelihood Security for the Poor:

To ensure equitable access to environmental resources and quality for all sections of society, and in particular, to ensure that poor communities, which are most dependent on environmental resourc es for their livelihoods, are assured secure access to these resources .

iii. Inter-generational Equity:

To ensure judicious use of environmental resources to meet the needs and aspirations of present and future generations.

iv. Integration of Environmental Concerns in Economic and Social Development: To integrate environmental concerns into policies, plans , programmes, and projects for economic and social development.

v. Efficiency in Environmental Resource Use: To ensure efficient use of environmental resources in the sense of reduction in their use per unit of economic output, to minimize adverse environmental impacts.

vi. Environmental Governance: To apply the principles of good governance (transparency, rationality,
accountability, reduction in time and costs, and participation) to the management and regulation of use of environmental resources.

vii. Enhancement of Resources for Environmental Conservation: To ensure higher resource flows, comprising finance, technology, management skills, traditional knowledge, and social capital, for environmental conservation through mutually beneficial multistakeholder partnerships between local communities, public agencies, and investors.

The above objectives are to be realized through various strategic interventions by different public authorities at Central, State, and Local Government levels. They would also be the basis of partnerships between public agencies, local communities, and various economic actors. However, these strategic interventions, besides legislation and the evolution of legal doctrines for realization of the objectives, need to be premised on a core set of unambiguously stated principles. The following principles, accordingly, would guide the activities of different actors in relation to this policy. Each of these principles has an established genealogy in policy pronouncements, jurisprudence, international environmental law, or international State practice:

i. Human beings are at the Centre of Sustainable Development Concerns: Human beings are at the centre of concerns for sustainable development. They are entitled to a healthy and productive life in harmony with nature.

ii. The Right to Development: The right to development must be fulfilled so as to equitably meet developmental and environmental needs of present and future generations.

iii. Environmental protection is an integral part of the development process: In order to achieve sustainable development, environmental protection shall constitute an integral part of the development process and cannot be considered in isolation from it.

iv. The Precautionary Approach: Where there are credible threats of serious or irreversible damage to key environmental resources, lack of full scientific certainty shall not be used as a reason for postponing cost-effective measures to prevent environmental degradation.

v. Economic Efficiency:

In various public actions for environmental conservation, economic efficiency would be sought to be realized.8

This principle requires that the services of environmental resources be given economic value, and such value to count equally with the economic values of other goods and services , in analysis of alternative courses of action. Further implications of this principle are as follows:

a) “Polluter Pays”: Impacts of acts of production and consumption of one party may be visited on third parties who do not have a direct economic nexus with the original act. Such impacts are termed “externalities”. If the costs (or benefits) of the externalities are not re-visited on the party responsible for the original act, the resulting level of the entire sequence of production or consumption, and externality, is inefficient. In such a situation, economic efficiency may be restored by making the perpetrator of the externality bear the cost (or benefit) of the same.

The policy will, accordingly, promote the internalisation of environmental costs , including through the use of incentives based policy instruments, taking into account the approach that the polluter should, in principle, bear the cost of pollution, with due regard to the public interest and without distorting international trade and investment.

b) Cost Minimization: Where the environmental benefits of a course of action cannot, for methodological or conceptual reasons, be imputed economic value (as in the case of “Incomparable Entities” [see below]), in any event the economic costs of realizing the benefits should be minimized.

Efficiency of resource use may also be accomplished by the use of policy instruments that create incentives to minimise wasteful use and consumption of natural resources. The principle of efficiency also applies to issues of environmental governance by streamlining processes and procedures in order to minimize costs and delays.

vi. Entities with “Incomparable”9 Values:

Significant risks to human health, life, and environmental life-support systems, besides certain other unique natural and man-made entities, which may impact the well-being broadly conceived of large numbers of persons , may be considered as ”Incomparable” in that individuals or societies would not accept these risks for compensation in money or conventional goods and services. A conventional economic cost-benefit calculus would not, accordingly, apply in their case, and such entities would have priority in allocation of societal resources for their conservation without consideration of direct or immediate economic benefit.

vii. Equity:

The cardinal principle of equity or justice requires that human beings cannot be treated differently based on irrelevant differences between them. Equity norms must be distinguished according to context, i.e. “procedural equity”, relating to fair rules for allocation of entitlements and obligations, and “endresult equity”, relating to fair outcomes in terms of distribution of entitlements and obligations. Each context, in addition, must be distinguished in terms of “intra-generational equity”, relating to justice within societies and in particular providing space for the participation of underprivileged men and women, and “inter-generational equity”, relating to justice between generations.

Equity, in the context of this policy refers to both equity in entitlements to, and participation of the relevant publics in processes of decision-making over use of, environmental resources.

viii. Legal Liability:

Civil liability for environmental damage would deter environmentally harmful actions, and compensate the victims of environmental damage. Conceptually, the principle of legal liability may be viewed as an embodiment in legal doctrine of the “polluter pays” approach, itself deriving from the principle of economic efficiency.

The following alternative approaches to legal liability may apply:

a) Fault based liability

In a fault based liability regime a party is held liable if it breaches a preexisting legal duty, for example, an environmental standard.

b) Strict liability

Strict liability imposes an obligation to compensate the victim for harm resulting from actions or failure to take action, which may not necessarily constitute a breach of any law or duty of care.

ix. Public Trust Doctrine:

The State is not an absolute owner, but merely a trustee of all natural resources, which are by nature meant for public use and enjoyment, subject to reasonable conditions, necessary to protect the legitimate interest of a large number of people, or for matters of strategic national interest.

x. Decentralisation:

Decentralization involves ceding or transfer of power from a Central Authority to State and Local Authorities, in order to empower public authorities having jurisdiction at the spatial level at which particular environmental issues are salient, to address these issues.

xi. Integration:

Integration refers to the inclusion of environmental considerations in sectoral policymaking, the integration of the social and natural sciences in environment related policy research, and the strengthening of relevant linkages among various agencies at the Central, State, and Local Self- Government, charged with the implementation of environmental policies.

xii. Environmental Standard Setting:

Environmental standards must reflect the economic and social development situation in which they apply. Standards adopted in one society or context may have unacceptable economic and social costs if applied without discrimination in another society or context Setting en vironmental standards would involve several considerations, i.e. risks to human health, risks to other environmental entities, technical feasibility, costs of compliance, and strategic considerations .

xiii. Preventive Action:

It is preferable to prevent environmental damage from occurring in the first place, rather than attempting to restore degraded environmental resources after the fact.

xiv. Environmental Offsetting:

There is a general obligation to protect threatened or endangered species and natural systems that are of special importance to sustaining life, providing livelihoods, or general well-being. If for exceptional reasons of overriding public interest such protection cannot be provided in particular cases, cost-effective offsetting measures must be undertaken by the proponents of the activity to restore as nearly as may be feasible the lost environmental services to the same publics.

The foregoing statement of policy objectives and principles are to be realized by concrete actions in different areas relating to key environmental challenges. A large number of such actions are currently under way, and have been for several years, in some cases, for many decades. In some aspects new themes would need to be pursued to realize the principles and objectives. The following strategic themes , and outlines of actions to be taken in each, focus on both ongoing activities, functions, and roles, as well as new initiatives that are necessary. However, they are not necessarily a complete enumeration in each case.

Regulatory Reforms:

The regulatory regimes for environmental conservation comprises a legislative framework, and a set of regulatory institutions. Inadequacies in each have resulted in accelerated environmental degradation on the one hand, and long delays and high transactions costs in development projects on the other. Apart from the legislation which is categorically premised on environmental conservation, a host of sectoral and cross-sectora l laws and policies, including fiscal regimes, also impact environmental quality (some of these are discussed in the succeeding sections).

Revisiting the Legislative Framework:

The present legislative framework is broadly contained in the umbrella Environment Protection Act 1986, the Water (Prevention and Control of Pollution) Act, 1974, the Water Cess Act 1977 and the Air (Prevention and Control of Pollution) Act, 1981. The law in respect of management of forests and biodiversity is contained in the Indian Forest Act 1927, the Forest (Conservation) Act 1980, the Wild Life (Protection) Act 1972 and the Biodiversity Act 2003. There are several other enactments, which complement the provisions of these basic enactments.

The following specific actions would be taken:

a) Institutionalize a holistic and integrated approach to the management of environment and natural resources, explicitly identifying and integrating environmental concerns in relevant sectoral and cross-sectoral policies through review and consultation, in line with the NEP, 2004.

b) Identify emerging areas for new legislation, due to better scientific understanding, economic and social development, and development of multilateral environmental regimes, in line with NEP, 2004.

c) Review the body of existing legislation in order to develop synergies among relevant statutes and regulations, eliminate obsolescence, and amalgamate provisions with similar objectives, in line with NEP, 2004.

d) Ensure accountability of the concerned levels of Government (Centre, State, Local) in undertaking the necessary legislative changes in a defined time-frame, with due regard to the Objectives and Principles of NEP, 2004, in particular, ensuring the livelihood and wellbeing of the poor.

Process related reforms

(i) Approach :

The recommendations of the Committee on Reforming Investment Approval & Implementation Procedures (The Govindarajan Committee identified delays in environment and forest clearances as the largest source of delays in development projects - Appendix I), will be followed for reviewing the existing procedures for granting clearances and other approvals under various statutes and rules. These include the Environment Protection Act, Forest Conservation Act, the Water (Prevention and Control of Pollution) Act, the Air (Prevention and Control of Pollution) Act and Wildlife (Protection) Act, and Genetic Engineering Approval Committee (GEAC) Rules under the Environment Protection Act. The objective is to reduce delays and levels of decision-making, realiz e decentralization of environmental functions, and ensure greater transparency and accountability.

(ii) Framework for legal action

The present approach to dealing with environmentally unacceptable behaviour in India has been largely based on criminal processes and sanctions. Although criminal sanctions, if successful, may create a deterrent impact, in reality they are rarely fruitful for a number of reasons. On the other hand, giving lower level officials the power to institute criminal prosecutions may provide fertile opportunities for rent-seeking.

Civil law , on the other hand, offers flexibility, and its sanctions can be more effectively tailored to particular situations. The evidentiary burdens of civil proceedings are less daunting than those of criminal law. It also allows for preventive policing through orders and injunctions to restrain prospective pollution.

Accordingly, a judicious mix of civil and criminal processes and sanctions will be employed in the legal regime for enforcement, through a review of the existing legislation. Civil liability law, civil sanctions , and processes would govern most situ ations of non-compliance. Criminal processes and sanctions would be available for serious, and potentially provable, infringements of environmental law, and their initiation would be vested in responsible authorities . Recourse may also be had to the relevant provisions in the Indian Penal Code, and the Criminal Procedure Code.

(i) Environment and Forests clearances In order to make the clearance processes more effective , the following actions will be taken:

a) Encourage regulatory authorities, Central and State, to institutionalise regional and cumulative environmental impact assessments (R/CEIAs) to ensure that environmental concerns are identified and addressed at the planning stage itself.

b) Give due consideration, to the quality and productivity of lands which are proposed to be converted for development activities, as part of the clearance process. Projects involving large-scale diversion of prime agricultural land would require environmental clearance whether or not the proposed activity otherwise requires environmental clearance.

c) Encourage clustering of industries and other development activities to facilitate setting up of environmental management infrastructure, as well as monitoring and enforc ing environmental compliance. Emphasize postproject monitoring and implementation of environmental management plans through participatory processes, involving the government, industry, and the potentially impacted community.

d) Prohibit the diversion of dense natural forests to non-forest use, except in site -specific cases of vital national interest. No further regularisation of encroachment on forests should be p ermitted.

(ii) Coastal Areas:

Development activities in the coastal areas are regulated by means of the Coastal Regulation Zone notifications and Integrated Coastal Zone Management (ICZM) Plans made under them. However, there is need to ensure that the regulations are firmly founded on scientific principles, in order to ensure effective protection to valuable coastal environmental resources , without unnecessarily impeding livelihoods, or legitimate coastal economic activity, or settlements, or infrastructure development.

The following actions would be taken :

a) Revisit the Coastal Regulation Zone (CRZ) notifications to make the approach to coastal environmental regulation more holistic, and thereby ensure protection to coastal ecological systems, coastal waters, and the vulnerability of some coastal areas to potential sea level rise. The Integrated Coastal Zone Management (ICZM) Plans need to be comprehensive, and prepared on scientific basis, with the participation of the local communities both in formulation and implementation. The ICZM Plans should be reviewed at pre-determined intervals to take account of changes in geomorphology, economies, and settlement patterns.

b) Decentralize, to the extent feasible, the clearance of specific projects to State environmental authorities, exempting activities, which do not cause significant environmental impacts, and are consistent with approved ICZM Plans.

(iii)Living Modified Organisms (LMOs):

Biotechnology has an immense potential to enhance livelihoods and contribute to the economic development of the country. On the other hand, LMOs may pose significant risks to ecological resources, and perhaps, human and animal health. In order to ensure that development of biotechnology does not lead to unforeseen adverse impacts, the following actions will be taken:

a) Review the regulatory processes for LMOs so that all relevant scientific knowledge is taken into account, and ecological, health , and economic concerns are adequately addressed.

b) Periodically review the National Bio-safety guidelines and Bio-safety Operations Manual to ensure that these are based on current scientific knowledge.

c) Ensure the conservation of bio-diversity and human health when dealing with LMOs in transboundary movement in a manner consistent with the Multilateral Bio-safety Protocol.

(iv)Environmentally Sensitive Zones:

Environmentally Sensitive Zones may be defined as areas with identified environmental resources with “Incomparable Values ” which require special attention for their conservation. In order to conserve and enhance these resources, without impeding legitimate socio -economic development of these areas, the following actions will be taken:

a) Identify and give legal status to Environmentally Sensitive Zones in the country with environmental entities with “Incomparable values” requiring special conservation efforts.

b) Formulate area development plans for these zones on a scientific basis, with adequate participation by the local communities.

c) Create local institutions with adequate participation for the environmental management of such areas to ensure adherence to the approved area development plans , which should be prepared in consultation with the local communities .

(v) Monitoring and Enforcement:

Weak enforcement of environmental compliance is attributed to inadequate technical capacities, monitoring infrastructure, and trained staff in enforcement institutions. In addition, there is insufficient involvement of the potentially impacted local communities in the monitoring of compliance, and absence of institutionalised public -private partnerships in enhancement of monitoring infrastructure.

The following actions would be taken :

a) Give greater legal standing to local community based organizations to undertake monitoring of environmental compliance, and report violations to the concerned enforcement authorities.

b) Develop feasible models of public -private partnerships to leverage financial, technical, and management resourc es of the private sector in setting up and operating infrastructure for monitoring of environmental compliance, with ironclad safeguards against possible conflict of interest or collusion with the monitored entities.

(vi) Use of economic principles in environmental decision-making:

It is necessary that the costs associated with the degradation and depletion of natural resources be incorporated into the decisions of economic actors at various levels to reverse the tendency to treat these resources as "free goods" and to pass the costs of degradation to other sections of society, or to future generations of the country.

At the macro-level, a system of natural resource accounting is required to assess whether in the course of economic growth we are drawing down, or enhancing, the natural resource base of production, including all relevant depletable assets. In addition, the environmental costs and benefits associated with various activities, including sectoral policies, should be evaluated to ensure that these factors are duly taken into account in decision-making.

The current near exclusive reliance on fiats based instruments for environmental regulation do not permit individual actors to minimize their own costs of compliance. This leads, on the one hand, to non-compliance in many cases, and on the other, unnecessary diversion of societal resources from other pressing needs. Economic instruments, of which a large, feasible suite has emerged through practical experience in several developed and developing countries, work by aligning the interests of economic actors with environmental com pliance, primarily through application of “polluter pays”. This may ensure that for any given level of environmental quality desired, the society-wide costs of meeting the standard are minimized. However, in some cases, use of economic instruments may require intensive monitoring, which too may entail significant societal costs. On the other hand, use of existing policy ins truments, such as the fiscal regime, may significantly reduce or eliminate the need for enhanced institutional capacities to administer the incentive based instruments . In future, accordingly, a judicious mix of incentives based and fiats based regulatory instruments would be considered for each specific regulatory situation.

The following actions would be taken:

a) Strengthen the initiatives being taken by the Central Statistical Organization in the area of natural resource accounting with a view to its adoption in the system of national income accounts.

b) Develop and promote the use of standardized environmental accounting practices and standards in preparation of statutory financial statements for large industrial enterprises, in order to encourage greater environmental responsibility in investment decision-making, management practices, and public scrutiny.

c) Encourage financial institutions to adopt appraisal practices, so that environmental risks are adequately considered in the financing of projects.

d) Facilitate the integration of environmental values into cost-benefit analysis to encourage more efficient allocation of resources while making public investment and policy decisions.

e) Prepare and implement an action plan on the use of economic instruments for environmental regulation in specified contexts.

Perverse production and consumption practices are the immediate causes of environmental degradation, but an exclusive focus on these aspects alone is insufficient to prevent environmental harm. The causes of degradation of environmental resources lie ultimately in a broad range of policy, and institutional, including regulatory shortcomings, leading to the direct causes. However, the range of policies, and legal and institutional regimes, which impact the proximate factors, is extremely wide, comprising fiscal and pricing regimes, and sectoral and cross -sectoral policies, laws, and institutions. Accordingly, apart from programmatic approaches, review and reform of these regimes to account for their environmental consequences is essential. In addition, there is lack of awareness of the causes and effects of environmental degradation, and how they may be prevented, among both specialized practitioners of the relevant professions, including policymakers, as well as the general public, which needs to be redressed. In this subsection, in respect of major categories of environmental resources, the proximate and deeper causes of their degradation, and specific initiatives for addressing them are outlined.

Land Degradation:

The degradation of land, through soil erosion, alkali-salinization, water logging, pollution, and reduction in organic matter content has several proximate and underlying causes. The proximate causes include loss of forest and tree cover (leading to erosion by surface water run-off and winds), excessive use of irrigation (in many cases without proper drainage, leading to leaching of sodium and potassium salts), improper use of agricultural chemicals (leading to accumulation of toxic chemicals in the soil), diversion of animal wastes for domestic fuel (leading to reduction in soil nitrogen and organic matter), and disposal of industrial and domestic wastes on productive land. These in turn, are driven by implicit and explicit subsidies for water, power, fertilizer and pesticides, and absence of conducive policies and regulatory systems to enhance people’s incentives for afforestation and forest conservation. It is essential that the relevant fiscal, tariffs, and sectoral policies take explicit account of their unintentional impacts on land degradation, if the fundamental basis of livelihoods for the vast majority of our people is not to be irreparably damaged. In addition, to such policy review, the following specific initiatives would be taken:

a) Encourage adoption of science-based, and traditional sustainable land use practices through research and development, pilot scale demonstrations, and large scale dissemination, including farmer’s training, and where necessary, access to institutional finance.

b) Promote reclamation of wasteland and degraded forestland through formulation and adoption of multistakeholder partnerships involving the land owning agency, local communities, and investors.

c) Prepare and implement thematic action plans for arresting and reversing desertification.

Forests and Wildlife:

(i) Forests:

Forests provide a multiplicity of environmental services. Foremost among these is the recharging of mountain aquifers, which sustain our rivers. They also conserve the soil, and prevent floods and drought. They provide habitat for wildlife and the ecological conditions for maintenance and natural evolution of genetic diversity of flora and fauna. They are the traditional homes of forest dwelling tribals, the major part by far of whose livelihoods depend on forests. They yield timber, fuel-wood, and other forest produce, and possess immense potential for economic benefits, in particular for local communities, from sustainable eco-tourism.

On the other hand, in recent decades, there has been significant loss of forest cover, although there are now tangible signs of reversal of this trend. The principal direct cause of forest loss has been the conversion of forests for agriculture, settlements, infrastructure, and industry. In addition, commercial extraction of fuel-wood, illegal felling, and grazing of cattle, has degraded forests. These causes, however, have their origins in the fact that the environmental values provided by forests are not realized as direct financial benefits by various parties, at least to the extent of exceeding the monetary incomes from alternative uses, including those arising from illegal use. Moreover, while since antiquity forest dwelling tribes had generally recognized traditional community rights over the forests, on account of which they had strong incentives to use the forests sustainably and to protect them from encroachers, following the commencement of formal forest laws and institutions in 1865, these rights were effectively extinguished in many parts of the country. Such disempowerment has led to the forests becoming open access in nature, leading to their gradual degradation in a classic manifestation of the “Tragedy of the Commons ”, besides leading to perennial conflict between the tribals and the Forest Department, and constituting a major denial of justice.

It is possible that some site-specific non-forest activities may yield overall societal benefits significantly exceeding that from the environmental services provided by the particular tract of forest. However, large scale forest loss would lead to catastrophic, permanent change in the country’s ecology, leading to major stress on water resources and soil erosion, with consequent loss of agricultural productivity, industrial potential, living conditions, and the onset of natural disasters including drought and floods. In any event, the environmental values of converted forests must be restored, as nearly as may be feasible, to the same publics.

The National Forest Policy, 1988, and the Indian Forest Act, as well as the regulations under it, provide a comprehensive basis for forest conservation. However, it is necessary, looking to some of the underlying causes of forest loss, to take some further steps. These include:

a) Give legal recognition of the traditional rights of forest dwelling tribes. This would remedy a serious historical injustice, secure their livelihoods, reduce possibilities of conflict with the Forest Departments, and provide long-term incentives to the tribals to conserve the forests.

b) Formulate an innovative strategy for increase of forest and tree cover from the present level of 23 percent of the country’s land area, to 33 percent in 2012, through afforestation of degraded forest land, wastelands, and tree cover on private or revenue land. Key elements of the strategy would include:

(i ) the implementation of multistakeholder partnerships involving the Forest Department, local communities, and investors, with clearly defined obligations and entitlements for each partner, following good governance principles, to derive environmental, livelihood, and financial benefits;

(ii) rationalization of restrictions on cultivation of forest species outside notified forests, to enable farmers to undertake social and farm forestry where their returns are more favourable than cropping, and

(iii) universalization of th e Joint Forestry Management (JFM) system throughout the country.

c) Focus public investments on enhancing the density of natural forests, mangroves conservation, and universalization of Joint Forestry Management.

d) Formulate an appropriate methodology for reckoning and restoring the environmental values of forests, which are unavoidably diverted to other uses.

e) Formulate and implement a “Code of Best Management Practices” for dense natural forests to realize the Objectives and Principles of NEP, 2004.

(ii) Wildlife:

The status of wildlife in a region is an accurate index of the state of ecological resources, and thus of the natural resource base of human well being. This is because of the interdependent nature of ecological entities (“the web of life”), in which wildlife is a vital link. 13 Moreover, several charismatic species of wildlife embody “Incomparable Values”, and at the same time, are a major resource base for sustainable eco-tourism.

Conservation of wildlife, accordingly, involves the protection of entire ecosystems. However, in several cases, delineation of and restricting access to such Protected Areas14 (PAs), as well as encroachment of human settlements on these areas has led to man-animal conflicts. While physical barriers may temporarily reduce such conflict, it is preferable to address their underlying causes. These may largely arise from the non-involvement of relevant stakeholders in identification and delineation of PAs.

In respect of Wildlife Conservation, the following elements would be pursued:

a) Expand the Protected Area (PA) network of the country, including Conservation and Community Reserves, to give fair representation to all biogeographic zones of the country. In doing so, develop norms for delineation in terms of the Objectives and Principles of NEP, 2004, in particular, participation of local communities, concerned public agencies, and other stakeholders, to harmonize ecological and physical features with needs of socio -economic development. It must be ensured that the overall are a of the network, in each bio-geographic zone would increase in the process.

b) Paralleling multistakeholder partnerships for afforestation, formulate and implement similar partnerships for enhancement of wildlife habitat in Conservation Reserves and Community Reserves, to derive both environmental and eco-tourism benefits.

c) Promote site-specific eco-development programmes in fringe areas of PAs, to restore livelihoods and access to forest produce by local communities owing to access restrictions in PAs.

d) Strengthen capacities and implement measures for captive breeding and release into the wild identified endangered species.

Biodiversity, comprises both genetic and ecosystems diversity. Loss of biodiversity is primarily due to degradation or alteration of ecosystems, in particular the habitats of site-specific species. Damage to such habitats arises from land degradation, forest loss, conversion of wetlands, pollution of and excessive water drawals from rivers, and loss of coastal ecosystems, the reasons for which have been discussed separately. Conservation of genetic diversity, in particular, is crucial for development of improved crop varieties resistant to particular stresses, new pharma products, etc., apart from ensuring the resilience of ecosystems. However, it is presently difficult to foresee the future potential of any particular genetic resource, and accordingly economic values are uncertain. Traditional Knowledge (TK), referring to ethno-biology knowledge possessed by local communities, relates to uses of various indigenous plant and faunal varieties, including in traditional medicine, food, etc., and is potentially an important means of unlocking the value of genetic diversity through reduction in search costs.

Natural heritage sites, including endemic “biodiversity hotspots”, sacred groves and landscapes, are repositories of significant genetic and ecosystem diversity, and the latter are also important bases for eco-tourism. They are nature’s laboratories for evolution of wild species in response to change in environmental conditions .

India is fortunate in having, through the efforts of dedicated scientists over many decades,15 developed vast inventories of floral and faunal resources, as well as ethno-biology knowledge. India is, thus well-placed to tap this enormous resource base for benefits for the country as a whole, and local communities in particular, provided that the genetic resources are conserved, and appropriate Intellectual Property Rights (IPRs) conferred on local communities in respect of their ethno-biology knowledge.

A large-scale exercise has been completed for providing inputs towards a National Biodiversity Action Plan. These inputs would be reviewed in terms of the Objectives and Principles of NEP, 2004, scientific validity, financial and administrative feasibility, and legal aspects. In any event, the following measures would be taken:

a) Strengthen the protection of areas of high endemism of genetic resources (“biodiversity hot spots”), while providing alternative livelihoods and access to resources to local communities who may be affected thereby.

b) Pay explicit attention to the potential impacts of development projects on biodiversity resources and natura l heritage. In appraisal of such projects by cost-benefit analysis, assign values to biodiversity resources at or near the upper end of the range of uncertainty. In particular, ancient sacred groves and “biodiversity hotspots” should be treated as possessing “Incomparable Values”.

c) Enhance ex-situ conservation of genetic resources in designated gene banks across the country. Genetic material of threatened species of flora and fauna must be conserved on priority.

d) Formulate and adopt an internationally recognized system of legally enforceable sui-generis intellectual property rights for the country’s genetic resources, to enable the country, including where relevant the local communities, to derive economic benefits from grant of access to these resources .

e) Similarly, formulate and adopt an internationally recognized system of legally enforceable sui-generis intellectual property rights for ethno-biology knowledge, to enable local communities to realize significant financial benefits from permitting the use of such knowledge. Set up an on-line database of the inventory of such ethno-biology knowledge, once the legal regime, domestic and multilateral, for their protection is in place.

India’s freshwater resources comprise the single most important class of natural endowments enabling its economy and its human settlement patterns. The freshwater resources comprise the river systems, groundwater, and wetlands. Each of these has a unique role, and characteristic linkages to other environmental entities.

(i) River Systems:

India’s river systems typically originate in its mountain eco-systems, and deliver the major part of their water resources to the populations in the plains. They are subject to siltation from sediment loads due to soil loss, itself linked to loss of forest and tree cover. They are also subject to significant net water withdrawals along their course, due to agricultural, industrial, and municipal use; as well as pollution from human and animal waste, agricultural run-offs, and industrial effluents. Although the rivers possess significant natural capacity to assimilate and render harmless many pollutants, the existing pollution inflows in most cases substantially exceed such natural capacities. This fact, together with progressive reductions in stream flows, ensures that the river water quality in the vast majority of cases declines as one goes downstream. The results include loss of aquatic flora and fauna, leading to loss of livelihoods for river fisherfolk, significant impacts on human health from polluted water, loss of habitat for many bird species, and loss of inland navigation potential. Apart from these, India’s rivers are inextricably linked with the history and religious beliefs of its peoples, and the degradation of important river systems accordingly offends their spiritual, aesthetic, and cultural sensibilities.

The broad direct causes of rivers degradation are, in turn, linked to several policies and regulatory regimes. These include tariff policies for irrigation systems and industrial use, which, through inadequate cost-recovery, provide incentives for overuse near the headwork’s of irrigation systems, and drying up of irrigation systems at the tail-ends. The result is excessive cultivation of water intensive crops near the headwork’s, which is otherwise inefficient, waterlogging , and alkali-salinization of soil. The irrigation tariffs also do not yield resources for proper maintenance of irrigation systems, leading to loss in their potential; in particular, resources are generally not available for lining irrigation canals to prevent seepage loss. These factors result in reduced flows in the rivers. Pollution loads are similarly linked to pricing policies leading to inefficient use of agricultural chemicals, and municipal and industrial water use. In particular, revenue yields for the latter two are insufficient to install and maintain sewage and effluent treatment plants, respectively. Pollution regulation for industries is typically not based on formal spatial planning to facilitate clustering of industries to realize scale economies in effluent treatment, resulting in relatively high costs of effluent treatment, and consequent increased incentives for non-compliance. There is, accordingly need to review the relevant pricing policy regimes and regulatory mechanisms in terms of their likely adverse environmental impacts.

The following comprise elements of an action plan for river systems:

a) Promote integrated approaches to management of river basins by the concerned river authorities, considering upstream and downstream inflows and withdrawals by season, pollution loads and natural regeneration capacities, to ensure maintenance of adequate flows and adherence to water quality standards throughout their cours e in all seasons.

b) Consider and mitigate the impacts on river flora and fauna, and the resulting change in the resource base for livelihoods, of multipurpose river valley projects, power plants, and industries.

c) Consider mandating the installation of water saving closets and taps in the building byelaws of urban centres.

(ii) Groundwater:

Groundwater is present in underground aquifers in many parts of the country. Aquifers near the surface are subject to annual recharge from precipitation, but the rate of recharge is impacted by human interference. Deep aquifers, on the other hand, occur below a substratum of hard rock. The deep aquifers generally contain very pure water, but since they are recharged only over many millennia, must be conserved for use only in periods of calamitous drought such as may happen only once in several hundred years. The boundaries of groundwater aquifers do not generally correspond to the spatial jurisdiction of any local public authorities or private holdings, nor are they easily discernable, nor can withdrawals be easily monitored, leading to the unavoidable situation of groundwater being an open access resource.

The water table has been falling rapidly in many areas of the country in recent decades. This is largely due to withdrawal for agricultural, industrial, and urban use, in excess of annual recharge. In urban areas, apart from withdrawals for domestic and industrial use, housing and infrastructure such as roads, prevent sufficient recharge. In addition, some pollution of groundwater occurs due to leaching of stored hazardous waste and use of agricultural chemicals, in particular, pesticides. Contamination of groundwater is also due to geogenic causes, such as leaching of arsenic from natural deposits. Since groundwater is frequently a source of drinking water, its pollution leads to serious health impacts.

The direct causes of groundwater depletion have their origin in the pricing policies for electricity and diesel. In the case of electricity, where individual metering is not practiced, a flat charge for electricity connections makes the marginal cost of electricity effectively zero. Subsidies for diesel also reduce the marginal cost of extraction to well below the efficient level. Given the fact that groundwater is an open access resource, the user then “rationally” (i.e. in terms of his individual perspective), extracts groundwater until the marginal value to him equals his now very low marginal cost of extraction.16 The result is inefficient withdrawals of groundwater by all users, leading to the situation of falling water tables. Support prices for several water intensive crops with implicit price subsidies aggravate this outcome by strengthening incentives to take up these crops rather than less water intensive ones.

Falling water tables have several perverse social impacts, apart from the likelihood of mining of deep aquifers, “the drinking water source of last resort”. The capital costs of pump sets and bore wells for groundwater extraction when water tables are very deep may be relatively high, with no assurance that water would actually be found. In such a situation, a user who may be a marginal farmer able to borrow the money only at usurious rates of interest, may, in case water is not found, find it impossible to repay his debts. This may lead to destitution, or worse. Even if the impacts were not so dire, there would be excessive use of electricity and diesel.

The efficient use of groundwater would, accordingly, require that the practice of non-metering of electric supply to farmers be discontinued in their own enlightened self-interest. It would also be essential to progressively ensure that the environmental impacts are taken into account in setting electricity tariffs, and diesel pricing.

Increased run-off of precipitation in urban areas due to impermeable structures and infrastructure prevents groundwater recharge. This is an additional cause of falling water tables in urban areas. In rural areas several cost-effective contour bunding techniques have been proven to enhance groundwater recharge. A number of effective traditional water management techniques to recharge groundwater have been discontinued by the local communities due to the onset of pump sets extraction, and need to be revived. Finally, increase in tree cover, is also effective in enhancing groundwater recharge.

Pollution of groundwater from agricultural chemicals is also linked to their improper use, once again due to pricing policies, especially for chemical pesticides, as well as agronomic practices, which do not take the potential environmental impacts into account. While transiting through soil layers may considerably eliminate organic pollution loads in groundwater, this is not true of several chemical pesticides.

The following action points emerge:

a) Take explicit account of impacts on groundwater tables of electricity tariffs and pricing of diesel.

b) Promote efficient water use techniques, such as sprinkler or drip irrigation, among farmers. Provide necessary pricing, inputs, and extension support to feasible and remunerative alternative crops from efficient water use.

c) Support practices of contour bunding and revival of traditional methods for enhancing groundwater recharge.

d) Mandate water harvesting in all new constructions in relevant urban areas, as well as design techniques for road surfaces and infrastructure to enhance groundwater recharge.

e) Support R&D in cost effective techniques suitable for rural drinking water projects for removal of arsenic and mainstream their adoption in rural drinking water schemes in relevant areas.

(ii) Wetlands:

Wetlands, natural and manmade, freshwater or brackish, provide numerous ecological services. They provide habitat to aquatic flora and fauna, as well as numerous species of birds, including migratory species. The density of birds, in particular, is an accurate indication of the ecological health of a particular wetland. Several wetlands have sufficiently unique ecological character as to merit international recognition as Ramsar Sites.

Wetlands als o provide freshwater for agricultural and domestic use, help groundwater recharge, and provide livelihoods to fisher-folk. They may also comprise an important resource for sustainable tourism and recreation.18 They may be employed as an alternative to power, technology, and capital intensive municipal sewage plants; however, if used for this purpose without proper reckoning of their assimilative capacity, or for dumping of solid and hazardous waste, they may become severely polluted, leading to adverse health impacts. The inadvertent introduction of some alien species of flora in wetlands19 have also degraded their ecology.

Wetlands are under threat from drainage and conversion for agriculture and human settlements, besides pollution. This happens because pu blic authorities or individuals having jurisdiction over wetlands derive little revenues from them, while the alternative use may result in windfall financial gains to them. However, in many cases, the economic values of wetlands’ environmental services may significantly exceed the value from alternative use. On the other hand, the reduction in economic value of their environmental services due to pollution, as well as the health costs of the pollution itself, are not taken into account while using them as a waste dump. There also does not yet exist a formal system of wetland regulation outside the international commitments made in respect of Ramsar sites.

The following action points emerge:

a) Set up a legally enforceable regulatory mechanism for identified valuable wetlands to prevent their degradation and enhance their conservation. Develop a national inventory of such wetlands.

b) Formulate conservation and prudent use strategies for each significant catalogued wetland, with participation of local communities, and other relevant stakeholders.

c) Formulate and implement eco-tourism strategies for identified wetlands through multistakeholder partnerships involving public agencies, local communities, and investors.

d) Take explicit account of impacts on wetlands of significant development projects during the environmental appraisal of such projects; in particular, the reduction in economic value of wetland environmental services should be explicitly factored into cost-benefit analyses.

e) Consider particular unique wetlands as entities with “Incomparable Values”, in developing strategies for their protection.

Mountain ecosystems play a key role in providing forest cover, feeding perennial river systems, conserving genetic diversity, and providing an immense resource base for livelihoods through sustainable tourism. At the same time, they are among the most fragile of ecosystems in terms of susceptibility to anthropogenic shocks. There has been significant adverse impact on mountain ecosys tems by way of deforestation, submergence of river valleys, pollution of freshwater sources, despoliation of landscapes, degradation of human habitat, loss of genetic diversity, retreat of glaciers, and pollution. The most significant proximate causes of these are illegal logging and commercial fuel wood collection, besides faulty construction of infrastructure such as roads, power transmission lines and large dams, unplanned urbanization and lack of enforcement of building bye -laws, absence or disrepair of sanitation systems, setting up of polluting industries, climate change, and excessive use of agricultural chemicals. The underlying causes relate to absence of conducive policies to enable local communities to derive adequate financial returns from afforestation and non-consumptive use of forest resources, pricing policies for agricultural chemicals, inadequate enforcement of pollution standards, poor institutional capacities for urban and regional planning and municipal regulatory functions, and preparation of environmental impact assessments of infrastructure; besides absence of consensus on means of financing municipal infrastructure. Clearly, there is need to address these shortcomings through review of the relevant sectoral and cross -sectoral policies, and institutional capacity building. Additionally, the following elements of an Action Plan would be taken up:

a) Adopt “best practice” norms for infrastructure construction in mountain regions to avoid or minimize damage to sensitive ecosystems and despoiling of landscapes.

b) Encourage cultivation of traditional varieties of crops and horticulture by promotion of organic farming, enabling farmers to realize a price premium.

c) Promote sustainable tourism through adoption of “best practice” norms for tourism facilities and access to ecological resources, and multistakeholder partnerships to enable local communities to gain better livelihoods, while leveraging financial, technical, and managerial capacities of investors.

d) Consider particular unique mountainscapes as entities with “Incomparable Values”, in developing strategies for their protection.

Coastal Resources:

Coastal environmental resources comprise a diverse set of natural and manmade assets, including mangroves, coral reefs, estuaries, coastal forests, genetic diversity, sand dunes, geomorphologies, sand beaches, land for agric