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Free trade in green goods

Free trade in green goods
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First Published: Thu, Sep 04 2008. 11 13 PM IST
Updated: Thu, Sep 04 2008. 11 13 PM IST
It is widely believed that the world needs government regulation to save the environment; interestingly, trade barriers on green go-ods are a clear-cut case of the exact opposite. And India has some of the highest barriers.
According to an August study by the Australian Apec Study Centre, a think tank, one of the most significant roadblock to transmission of environment-friendly technology from developed to developing world is trade barriers. The so-called “green goods”, i.e., goods that leave less of an environment footmark compared with alternatives, face significant tariff and non-tariff barriers while being imported to India. Clean coal, wind and solar power technology face a tariff of 15%. Fluorescent lamps face an import tariff of 15% and non-tariff barriers equivalent to 102%! Among the 18 developing countries that emit the most greenhouse gases, India has the highest barrier to fluorescent lamps. And these figures are merely indicative of broader hurdles to Indians using environment-friendly technology.
Green goods themselves fall into two categories — technology for environment-friendly energy production and low energy use consumer appliances. With so much political and economic resources being spent on securing the nuclear deal with the US, at least partially for transmission of nuclear energy technology, it makes no sense to block technologies that open even cleaner energy opportunities.
Low energy use consumer appliances would be a great boon. With rising incomes, more than 750 million rural Indians are likely to buy modern electrical appliances and it’s already happening — eight million mobile phones were sold last month. This is, however, unlikely to be matched with the present state-controlled system of electricity production. In this background, environment-friendly appliances are a ray of hope.
There is also a political side to the entire issue. With Al Gore winning half a Nobel and the world in general waking up to environmental change, developing countries, particularly the so-called Bric nations (Brazil, Russia, India and China), are under increasing pressure to reduce carbon emissions. Freeing green trade will send out a positive message to the international community.
Should we be open to free trade in green goods? Write to us at views@livemint.com
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First Published: Thu, Sep 04 2008. 11 13 PM IST