India’s environmental clearance process is riddled with delays. Will proposed reform make it better or worse?
The new relaxations appear to tilt the balance in favour of project promoters. The most significant change is the legitimization of post-facto clearance after ecological damage is done
The draft Environmental Impact Assessment (EIA) Notification, 2020, released by the Union ministry of environment, forests and climate change (MoEFCC) has been mired in controversy ever since it was placed in the public domain in March. This notification, which aims to replace the existing EIA Notification, 2006, has been in the spotlight even more due to the occurrence of two high-profile industrial accidents recently—the gas leak at the LG Polymers plant in Visakhapatnam and the fire at Oil India Limited’s Baghjan oil well in Assam’s East Tinsukia district. In retrospect, both projects were found not to have all the required clearances.
Analysis of data on past projects shows that the process of obtaining environmental clearances is plagued by delays and inefficiencies. A 2016 report by the auditor to the government showed delays in each stage as well as poor monitoring of environmental violations. With the new EIA draft notification, the MOEFCC claims the process of granting clearances will be expedited through sweeping relaxations in several spheres.
However, based on what recent data shows, these relaxations appear to tilt the balance in favour of project promoters. For example, project promoters have often glossed over public consultations and now the new law is seeking to dilute the necessity of this step. The most significant change is the legitimization of post-facto clearances, where a project promoter can report a violation retrospectively and pay compensation for the damage done.
Environmentalists argue this can lead to more accidents like LG Polymers, since the plant was not operating with a valid environmental clearance at the time of the accident.
4-step clearance process
An EIA is the most critical step in the obtaining of environmental clearances (EC) since it systematically examines both benefits and adverse consequences of the proposed project. By ensuring that the environmental impacts and the mitigation measures are considered in the project design, the EIA seeks to ensure minimal damage to the environment and the optimal use of resources.
In India, an EIA is mandatory for certain development projects under the Environment (Protection) Act, 1986. The complete process for granting an EC has been notified in the 2006 notification. This classifies all projects into two categories, A and B, based on their spatial distribution and the scale of their potential impact on natural and man-made resources. Category A projects are larger in scale and mandatorily require clearances from the MOEFCC. Category B projects are further divided into two sub-categories: B1, which need to seek approval from the respective State Environmental Impact Assessment Authority (SEIAA), and B2, which are exempt from any clearances.
The 2006 notification outlines four sequential stages in the process for granting ECs, along with a recommended timeline. The first stage is screening and involves submitting a pre-feasibility report with the proposed terms of reference (ToR) to the MOEFCC. The screening is to determine whether the project requires an EC or not. Those that require an EC move to the scoping stage where an Expert Appraisal Committee (EAC), appointed by the ministry, either approves or rejects the project and displays the particulars on the MOEFCC website. These two stages are required to be completed within a total of 60 days.
The third stage involves public consultation. Here, the concerns of the local population and others who have a plausible stake in the environmental impacts of the project are heard and sought to be addressed. This consultation is based on the draft EIA, typically prepared by an accredited private consultant agency hired by the project proponent and submitted to the State Pollution Control Board (SPCB). The proceedings of the public consultation are to be displayed on the notice boards of the panchayats concerned and the SPCB website.
The fourth and final stage is where the EAC appraises the project and gives its recommendation to the MOEFCC, which takes the final call. The third and fourth stages are mandated to be completed in 105 days. There is a further post-EC monitoring mechanism, which entails the submission of half-yearly compliance reports.
However, the above process is beset by inefficiencies. A 2016 report by the Comptroller and Auditor General of India (CAG), which is the most recent such exercise, highlights deficiencies in all four stages. The analysis is based on a sample of 216 projects across seven sectors that were granted ECs between 2011 and 2015.
The first lacuna highlighted is delays. In 89% of cases, there was an overall delay in the grant of ECs to applicants. The delays were pervasive at all stages, but especially in the recommendation by the EAC to the competent authorities. In 2014, the projects in the CAG audit faced an average delay of 318 days over the prescribed limit (see Chart 1).
The CAG report also highlights several inconsistencies in the EC process, such as a lack of cumulative impact assessment. Each project’s impact was considered independently, without accounting for other existing or planned activities in its proximity. Further, in 2009, the MOEFCC had issued a memorandum that all consultants who conduct the environmental appraisal have to be registered with the Quality Council of India or the National Accreditation Board for Education and Training. However, the CAG audit found that for over a third of the projects analysed, the accreditation certificate was not available for the EIA consultants.
There were also irregularities found in the public consultation process in about 28% of the projects analysed. These included delay in the conduct of public hearing, missing advertisements, advertisement not in vernacular language and not taking views of the public into account. Further, in many cases, there was a shortfall in the commitments made during the public hearing, such as compensatory afforestation, education and employment for the local population, effluent treatment, etc.
CAG also noted that the ministry did not have a database of cases received by it where violations were reported by regional offices. More significantly, zero penalties were imposed by the ministry in 2014 and 2015 for violating EC conditions. As per a 1986 law, the penalty for non-compliance with EC conditions was up to ₹100,000 and/or imprisonment for up to five years. In 2015, an amendment allowed fines up to ₹15-20 crore, and an additional ₹1 crore per day if the damage continues. However, data regarding violations and fines imposed since 2015 is not available in the public domain.
CAG makes several recommendations to improve the EC process, such as adhering to timelines, better screening of projects based on the initial ToR submitted and the establishment of a national regulator to monitor environmental violations.
The CAG recommendations seem to have had some bearing on the MOEFCC. From 2017 onwards, there seems to be better initial screening of the EC applications. According to data from the Parivesh portal of the MOEFCC, in 2017, close to 20% of the EC applications were rejected at the screening stage itself, as opposed to zero projects rejected in 2015.
While the number of rejections decreased in 2018 and 2019, there has been a sharp increase in 2020. Close to 40% of EC applications this year have been rejected at the outset. Some of these projects have been rejected simply because they have applied to the wrong authorities. These include the aforementioned Category B projects, which need to seek approval from the state authorities. However, a majority have been rejected for not meeting the stringent requirements laid down by the 2006 EIA notification. There are projects with missing documents, environmental management plans (EMPs) not fully fleshed out, and inconsistencies in the ToR (see Chart 2).
While the increased scrutiny is noteworthy, there are concerns that the 2006 notification is too restrictive. In a recent interview to the Hindustan Times, RP Gupta, secretary in the MOEFCC, said India took too long to issue environment clearances. The new draft EIA notification seeks to relax some of the more stringent regulations of the existing EIA regime—and expedite ECs.
Changes and critique
So what has changed in the new draft notification? For starters, a set of 40 industries will now be classified under Category B2, and therefore be exempt from the EIA and public consultation process. This includes projects labelled ‘strategic’ by the government. No information on “such projects shall be placed in the public domain". The projects under this category include oil, gas and shale exploration, hydroelectric projects up to 25 MW, irrigation projects between 2,000 and 10,000 hectares of command area, all inland waterway projects, and the expansion or widening of highways between 25km and 100km with defined parameters.
Further, projects such as roads and pipelines in border areas will not require any public hearing. The ‘border area’ is defined as “area falling within 100km aerial distance from the Line of Actual Control". Activists argue these relaxations will increase the discretionary powers of the MOEFCC in offering concessions to projects that might have severe consequences on the environment and local populations.
The new draft notification has also reduced the mandatory window for public consultation from a minimum of 30 days to a minimum of 20 days. This has caused concerns that there might not be enough time for the public to be informed and to raise objections, especially in far-flung tribal regions. The issuing of sand-mining licenses in Maharashtra during the lockdown after an online public consultation through Zoom has been criticized by activists as a sham exercise.
However, the most contentious and consequential change is the introduction of post-facto project clearances. This means that projects operating in violation of the Environment Protection Act will now be able to apply for clearance, as long as they have a plan for remediation and resource augmentation equivalent to 1.5-2 times “the ecological damage assessed and economic benefit derived due to violation." Further, these violations cannot be reported by the public, but only by the government authorities or the developer-promoter itself.
This goes against two central tenets of environment protection: The ‘precautionary principle’ and the ‘public trust doctrine’. Once the damage has occurred to the environment, it is often irreparable, especially in sensitive ecosystems, and no amount of post-facto remediation will resolve the problem. By disenfranchising the public who are most likely to suffer the consequences of environmental violations, the new notification favours the interests of promoters over that of the local population.
Activists have decried the changes to the notification as facilitating business interests, rather than the protection of the environment. The government, however, is calling for a more measured view. In the same interview, Gupta says that while the new notification might make issuing clearances faster, there needs to be a stronger monitoring and enforcement mechanism. He adds this notification is only the first part, and the ministry will release a new monitoring mechanism soon.
India may be climbing the global rankings on the ease of doing business, but its environmental protection record remains dismal. In 2020, India ranked 168 out of 180 countries, according to Yale University’s Environmental Performance Index. The global index comprises 32 indicators of environmental performance and gives a snapshot of 10-year trends. As India strives for further economic growth, it has to ensure this does not come at the cost of its environment, and a robust EIA legislation is critical for a sustainable future.