Nirmala Sitharaman, Finance Minister, presented the Union Budget for the Year oFebruary 1,. Its efforts to promote business activity and infrastructural growth have earned it the “booster budget”.
Climate action was highlighted along with Prime Minister Gati Shakti’s infrastructure masterplan and inclusive development.
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Many environmental terms such as net-zero and climate change, energy transition, carbon intensity and carbon intensity were first used in any Union Budget.
The budget for 2022 can therefore be considered a “green” budget. This is also evident in the current year’s Economic Survey which includes a whole chapter on India’s Sustainable Development Goals implementation, forest cover management, groundwater resources and river systems, as well as climate change adaptation.
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According to the Overseas Development Institute (ODI), India could lose 3-10% of its GDP annually due to climate change by 2100.
Also, India’s three paper goals were submitted to UNFCCC in the form its Nationally Determined contribution. They were: to reduce India’s emissions intensity; to increase the nonfossil-based electric power component; and to increase the carbon sink from forest cover and tree cover. Climate finance was a key item in the budget.
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According to the most recent data, the central government subsidies through the National Adaptation Fund on Climate Change have been steadily declining over the past five years, according to the latest data. The Minister of State for Finance Pankaj Chaudhary provided data to Parliament Monday. Grants under the NAFCC fell from Rs 115.36 Crore in 2017-18 to Rs 42.94 Crore in 2020-21 and Rs 27.76 Crre (till December 2021).
NAFCC is one the Centre’s major programmes. It is also part of the Climate Change Action Program. Between 2015 and 2019, NAFCC approved 30 projects, with a total budget in excess of Rs. 847.5 crore.
Climate financing budget
In areas such as climate change, the Union Budget 2022-22-23 stressed sovereign green bonds. The Reserve Bank of India will issue green bond as part of the government’s larger borrowing programme. They will be used for funding initiatives that reduce carbon emissions. Officials from Finance Ministry expect to generate a substantial sum using these bonds this fiscal year. The government will outline a plan to use the money from these bonds.
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Blended funding will be provided jointly by NABARD and other institutions as well as contributions from the private sector and government.
India has seen a rise in overseas green bond market issuances. India currently ranks second (after China) in Green Bonds issuance. Chaudhary stated that till date, 11 green debt securities have been issued by Indian private and public sector entities, amounting to Rs 399 crore.
Is it really a green-budget?
There has been a lot of protest in recent years against infrastructural projects that failed to accurately gauge the environmental consequences.
Public opposition to many linear infrastructure projects continues to be strong due to their environmental or social consequences. These include the proposed Bullet train in Gujarat, and the proposed Silver Line to Kerala. Proposed highway expansions in Goa, which will affect the Mollem National Park, and Karnataka, which will affect the Bandipur Tiger Reserve.
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Mongabay is written by S Gopikrishna Warrier (a senior environmental journalist) that “the Budget should not be viewed in isolation of the government priorities and actions in previous years. The NDA government has been diluting environmental regulations in order to increase the ease of doing business. The process of assessing environmental impacts of a project is itself diluted.”
It is not a secret that forests have often been the collateral damage of many infrastructure projects. The Economic Survey, which cites the India State of Forest Report 2021, states that “much of India’s increase in forest coverage during 2011-21 can be attributed to an enhancement in very dense forest covers, which rose by approximately 20 percent during this period.”
Open forest cover also increased by seven percent over the same period. There is still much to be done to improve the forest and tree coverage. Social forestry could also play an important role in this regard.
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Mongabay India has analysed data from the India State of Forest Report 2021 and found that forests have been less dense in recent years. This means that more plantations are being portrayed to be forests.
Warrier argues that, while the central Government may implement its energy transformation plan as part of their infrastructure drive, Warrier asserts that the green language of Budget is more likely lead to a net loss for environment.
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