Government Bonds with Green

The government listed green growth as one of its seven goals in the 2023–24 union budget, which was unveiled on February 1st, 2023. The 2023-2024 budget seems to aim toward strengthening India’s economic status. The country’s economy has been termed a ‘bright star’ with its economic growth estimated at around 7%, which makes it lie amongst the top major economies.

Nirmala Sitharaman talked about how ‘green growth’ is one of four opportunities that can be transformative during Amrit Kaal (referring to the next 25 years in India’s growth, a term coined by the Prime Minister). Green growth is defined as economic growth that is environmentally beneficial. Together with some successes and failures in the field of renewable energy, the union finance minister unveiled plans to conserve wetlands and mangroves and pushed for sustainable urban growth. Although a large portion of the green focus was to be expected, experts identified some crucial environmental and sustainable growth sectors that were disregarded.

According to the 2023 budget, during the next three years, the government will help 1 crore (10 million) farmers switch to natural/chemical-balanced farming. 5-7% biomass pellets will also be co-fired in thermal power plants as part of the transition to a carbon-neutral economy, saving 38 million metric tons (MMT) of CO2 every year. This would lessen the likelihood of agricultural fields burning stubble.

The government will also focus on promoting chemical-free natural farming starting with farmers’ lands close to the river Ganga. The Union government has also increased allocations for the Jal Jeevan Mission from a revised estimate of Rs 45,011 crore to a budget estimate of Rs 60,000 crore. The estimated total expenditure for the Ministry of Environment, Forest and Climate Change (MoEFCC) is higher this time, standing at Rs 3,030 crore when compared to Rs 2,520 crore in 2022. For the Deep Ocean Mission, the government has spent Rs 150 crore in 2022, and Rs 650 crore has been allocated in this year’s budget. The National Mission for Green India, Project Tiger, and funds to control pollution have also seen increases in allocations when compared to last year.

While the Union government made extremely specific allocations to tackle air pollution in the last budget, there are no additional funds to specifically address the issue this year. The budget also comprises large-scale projects that could have detrimental impacts on the environment. A large amount of infrastructure projects have been envisioned under the PM Gati Shakti scheme. Even though the finance minister claimed that the approach to developing all the infrastructure will be through clean energy, the scale at which these projects will be implemented makes that look very uncertain. The infrastructure projects will affect more than 15 lakh hectares of land area in India. Currently, more than 4.4 million people are affected and there are 315 ongoing conflicts surrounding infrastructure projects. Moreover, detailed Project Reports for five more river-linking projects have been finalized including eDamanganga-Pinjal, Par-Tapi- Narmada, Godavari-Krishna, Krishna-Pennar, and the Pennar-Cauvery. Huge criticism from water experts, conservationists, and activists (both social and environmental) for the numerous deleterious hydrological, social, and environmental effects it would have in the Bundelkhand area of Uttar Pradesh and Madhya Pradesh.

On one hand, the announcements seem to be taking a step in the right direction with electric vehicle policy, battery-swapping, and coal gasification policy but on the other hand, they?appear to fall short of “promoting clean energy in an accelerated manner”. Experts believe that the government should have provided a budget allocation and reduction in duties to allow the deployment of rooftop solar, storage, off-shore wind, green hydrogen, etc. Further, the budget did not include any mention of support for the closure of inefficient fossil fuel plants, nor did it deal with increasing air pollution problems.

There was a recent Supreme Court decision that stated that economic development cannot be halted. They acknowledged environmental concerns but stated that it could not be at the expense of human economic development. Overall, the budget was hit-and-miss with the government taking firm steps toward the betterment of nature and helping the farmers turn towards chemical-free farming, and simultaneously taking steps toward the development of India’s infrastructure which might result in harm to the environment eventually. Development cannot be halted but it needs to be balanced by countering the environmental impact with various strict measures in order to save our planet. However, it needs to be pondered upon which is the greater evil, chemicals or infrastructure?