6) India should seek to publish “green GDP” figures that take into account depreciation of natural capital stock due to economic exploitation and environmental degradation. Critically analyse.(250 words)

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TOPIC:  Indian Economy and issues relating to planning, mobilization of resources, growth,
development and employment.

6) India should seek to publish “green GDP” figures that take into account depreciation of natural capital stock due to economic exploitation and environmental degradation. Critically analyse.(250 words)

The hindu

Why this question

Environment provides us with the necessities of life and basic material for development. In the pursuit of more development, most nations have ignored the economic aspects of the exploitation of environment. Green GDP aims to capture the true position of a country as it includes the condition of the natural resources of the country, which in fact affect the quantum as well as pace of development. The question is related to GS 3 syllabus under the following heading-

Key demand of the question

The question wants us to discuss in detail about the concept of Green GDP and how it will be a better indicator than simple GDP. We also have to see the other side of publishing the Green GDP and then form a personal opinion on the issue.

Directive word

Critically analyse- we have to dig into the details of the Green GDP concept and highlight its important aspects and advantages over simple GDP figures. We have to see if there are any cons/ issues/ obstacles involved in publishing Green GDP figures and thereafter form a personal opinion on the issue.

Structure of the answer

Introduction– Briefly give a description of the concept of Green GDP.

Body-

  1. Discuss the need for prioritising Green GDP over GDP.
  1. Discuss the importance of natural capital and how its quality determines the development potential in the real sense and in the long run.
  2. Discuss the effects of loss of natural capital due to overexploitation of resources and disregard for the sustainability of the system.
  3. Discuss the culture of consumerism and materialism evoked by the GDP race and how it leads to unsustainable use of natural capital.

     

     2) Discuss the limitations/ obstacles involved in using green GDP.

  1. e.g difficulty in estimation of the value, lack of micro level data on capital formation and exploitation, pressure for improving GDP- internationally and domestically, lack of empirical studies on the value of natural capital etc.

Conclusion– Mention how the current GDP estimates include some of the natural capital exploited ( e.g minerals extracted; timber, fuelwood and non-timber forest products; natural growth of cultivated assets for some crops; and the output from dung manure etc. ) and mention how they underestimate the value and don’t include most of the services offered by natural capital. Also suggest a way-forward.