Home/ Opinion / Smart growth, sans Copenhagen

The “climaterattis" are locking horns in Copenhagen. All the arcane talk about greenhouse gases (GHG), melting glaciers, percentage cuts and relative fairness is lost on the average Indian. I would be willing to wager a tidy sum that most people have paid little attention to the issues, alternatives and magnitudes (indeed even the unit of measurement) related to environmental sustainability—leave alone have an informed view on the trade-offs. So, as Copenhagen winds up, it’s perhaps time to lay out what is actually at stake.

Very simply, the metric for GHG is the net amount of carbon dioxide that human activity (the buzzword for this is anthropogenic) puts into the atmosphere. More than half of this is absorbed by plants and the oceans—plants because they photosynthesize and oceans since carbon dioxide is water-soluble. The rest makes its way into the atmosphere. This is the so-called carbon footprint (CFP). For those who care, the exact unit is tonnes of carbon dioxide-equivalent measured in absolute or per capita terms. The biggest single industry contributor is thermal power and the largest country contributor is now China, with the US running a close second.

Most business folk have framed the debate as a direct trade-off between growth and CFP. They hold the view that it is India’s turn at the global growth wheel, and pedal to the metal it has to be. They believe that growth with constraints is something that India can ill afford and if the interim cost is the environment, then so be it. “Let’s get to $30,000 per capita and then we’ll worry about the environmental impact", goes the mantra. The jholawallahs (a loose coalition of greens and leftists) call this bad or dirty growth.

In turn, these jholawallahs define desirable growth as an ideal, green world where India’s growth will go back to a natural model. Sustainable resource usage would support a very simple and non-materialistic society. Citizens would eat produce that is grown locally, in homes made from reusable materials and walk or cycle to sustainable livelihoods. Self-reverentially they call this good growth.

It is possible to evolve policy and practice in India that makes practical choices while avoiding dogma. Christian Charisius / Reuters

I would like to propose that India adopt a conscious and well-thought out “smart growth" model. The difference between the smart growth model and the current “anything goes" model is that the former is aware of environmental impact and makes practical, sensible choices that balance the growth interest with CFP.

There are two possible critiques of the smart growth model. First, the market-based bad growth camp would charge that if it were possible to make a viable trade-off, then the market would have already taken care of it. Still, this seemingly tautological statement is fallacious because the “anything goes" approach does not take in any environmental inputs, outputs, benefits or costs. It cannot, therefore, be optimizing on something that has not been included. Second, the environmental benefit in the future needs to be quantified and discounted to the present to have an apples-to-apples comparison. But many pioneering studies that model this have used a very low discount rate, making benefits appear far more attractive than they would be if we used current market-based real interest rates.

Criticism aside, I think it is possible to evolve policy and practice in India that makes smart, practical choices for growth while avoiding the dogma of the good and bad “growthistas". In my view, it is desirable as an insurance policy against a catastrophe that may or may not happen but has disastrous consequences if it does. For starters, here is a list of smart growth actions we can take:

• Eliminate the petroleum product subsidy in order to rationalize demand (elimination of a subsidy). This can be substituted with more direct aid for families below the poverty line

• Require CNG buses and autos in all major metros (regulation)

• Incentivize the use of super and ultra-super critical power technology (subsidy and carbon credits)

• Accelerate the launch of already-started mass transit rail systems (execution)

• Adopt a nation-wide building code for large commercial buildings that is designed to save energy (regulation)

• Stick to previously agreed Bharat stage III and IV emission standard roll-outs by April, which would affect four-wheelers nationwide (execution)

• Undertake a systematic afforestation programme (regulation and execution)

This is a non-comprehensive list of simple, direct steps to do our bit for the environment. Large-scale talk-shops such as the one at Copenhagen are unlikely to succeed. Even if they agree on GHG cuts, there will likely not be an effective mechanism to monitor and ensure compliance. Existing multi-lateral institutions and frameworks are not encouraging models for global cooperation.

Better to follow an achievable, balanced, national approach to smart growth, just in case.

Narayan Ramachandran is managing director and country head, Morgan Stanley India. These are his personal views. Comment at theirview@livemint.com

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Updated: 16 Dec 2009, 10:36 PM IST
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