10 highlights of the new draft national forest policy
On June 15, India’s environment ministry placed the draft national forest policy in public domain for comments and suggestions. It is slated to replace the National Forest Policy, 1988
Less forests in hilly areas?
Hills and mountainous regions may not be required to maintain two-thirds of the geographical area under forest cover. Although the policy continues with the national goal of maintaining a minimum of one-third of the geographical area under forest or tree cover, the Forest Survey of India report released in December 2015 shows that India’s forest and tree cover makes up only 24.16 per cent of its geographical area.
Green tax on citizens
The draft National Forest Policy (NFP) proposes the levy of a green tax for facilitating ecologically responsible behaviour and supplementing financial resources essential to address forestry woes. “The budget of the forestry sector should be appropriately enhanced so that the objectives enshrined in this policy can be achieved. Environmental cess, green tax, carbon tax may be levied on certain products and services for facilitating ecologically responsible behaviour, garnering citizen’s contribution and supplementing financial resources,” the draft policy says.
Draft policy undermines the Forest Rights Act
NFP ignores Forests Rights Act, 2006, which empowers local gram panchayats, especially in tribal areas close to India’s forests, and proposes a joint forest management-like mechanism to enhance agro-forestry. This move will bring back the forest department as the final authority over using forest resources instead of forest dwellers and communities dependent on them.
Forest management mission to facilitate supply to wood industry
The policy proposes to launch a new Community Forest Management Mission, bringing government, community and private land under the new proposed management system. It aims to bring one-third of the government-owned forests under the Community Forest Management regime by the end of the next decade. The policy recommends contracts between forest-dependent industries and farmers to fix price and quantity to ensure supply for the wood industry. The policy says, “Large-scale expansion of agro-forestry and farm forestry should be encouraged through commensurate incentives and operational support systems such as lowering the input costs and enabling access to reasonably priced quality planting material.”
Technology to minimise damage to forests
The policy states that forest land diversion projects related to mining, quarrying, construction of dams, roads and other linear infrastructure need to adopt special caution. Use of state-of-the-art technology which causes minimum pollution and damage should be promoted.
Board to monitor management of forests
The policy states that a National Board of Forestry and State Boards of Forestry are to be established to ensure monitoring of the spread of the forest areas and management of forest cover.
Provisions for responsible tourism
It calls for developing “sound ecotourism models” with the focus on conservation while supplementing the livelihood needs of local communities. “Ensure that tourism is responsible, does not negatively impact wildlife and its habitat and maximises the income of the local community,” the policy says.
Climate change to emerge as important factor in policy
Climate change concerns should be effectively factored into all the forest and wildlife areas management plans and community ecosystem management plans, the policy states.
Purchase of wildlife corridors
The draft policy indicates that CAMPA(Compensatory Afforestation Fund Management and Planning Authority (CAMPA)funds from diversion of forest land by industry are to be used for purchasing wildlife corridors from people.
Maintaining urban forests
The policy also asks for management plans for city forests, parks, garden and woodlands to nurture and sustain urban health, clean air and related benefits.
Bread makers’ body withdraws carcinogenic additive -potassium bromate
Following the release of the CSE study, the FSSAI had said on May 24 that it would soon notify the removal of potassium bromate from the list of additives. It also said that it was examining evidence in case of potassium iodate and a decision would be taken soon.
FSSAI recently banned the additive and Bread makers also withdrew it.
It’s 100% FDI in most sectors, including defence
The government has announced a “radical liberalisation” of the Foreign Direct Investment (FDI) regime by easing norms for a host of important sectors including defence, civil aviation and pharmaceuticals, opening them up for complete foreign ownership.
Key Details:
- In defence, foreign investment beyond 49% (and upto 100%) has been permitted through the government approval route, in cases resulting in access to modern technology in the country. The condition of access to ‘state-of-art’ technology in the country has been done away with, as many foreign investors had complained about the ambiguity regarding that term.
- FDI limit also has been made applicable to Manufacturing of Small Arms and Ammunitions covered under Arms Act, 1959.
- 100% FDI has been permitted under government approval route for trading, including through e-commerce, in respect of food products manufactured or produced in India, bringing into effect the proposal made in the Budget 2016-17.
- To promote the development of pharmaceutical sector, the government has permitted up to 74% FDI under automatic route in existing pharmaceutical ventures. The government approval route will continue beyond 74% FDI and upto 100% in such brown-field pharma.
- 100% FDI has been permitted in India-based airlines. However, a foreign carrier can only own upto 49% stake in the venture, and the rest can come from a private investors including those based overseas. This is expected to bring in more funds into domestic airlines.
- To boost airport development and modernisation, 100% FDI in existing airport projects has been allowed without government permission, from 74% permitted so far.
- Entities undertaking single brand retail trading have been relaxed from local sourcing norms up to 3 years. Entities engaged in of single brand retail trading of products having ‘state-of-art’ and ‘cutting edge’ technology have been relaxed from local sourcing norms up to 5 years.
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Steve Ovett, the famous British middle-distance athlete, won the 800-metres gold medal at the Moscow Olympics of 1980. Just a few days later, he was about to win a 5,000-metres race at London’s Crystal Palace. Known for his burst of acceleration on the home stretch, he had supreme confidence in his ability to out-sprint rivals. With the final 100 metres remaining,
[wptelegram-join-channel link=”https://t.me/s/upsctree” text=”Join @upsctree on Telegram”]Ovett waved to the crowd and raised a hand in triumph. But he had celebrated a bit too early. At the finishing line, Ireland’s John Treacy edged past Ovett. For those few moments, Ovett had lost his sense of reality and ignored the possibility of a negative event.
This analogy works well for the India story and our policy failures , including during the ongoing covid pandemic. While we have never been as well prepared or had significant successes in terms of growth stability as Ovett did in his illustrious running career, we tend to celebrate too early. Indeed, we have done so many times before.
It is as if we’re convinced that India is destined for greater heights, come what may, and so we never run through the finish line. Do we and our policymakers suffer from a collective optimism bias, which, as the Nobel Prize winner Daniel Kahneman once wrote, “may well be the most significant of the cognitive biases”? The optimism bias arises from mistaken beliefs which form expectations that are better than the reality. It makes us underestimate chances of a negative outcome and ignore warnings repeatedly.
The Indian economy had a dream run for five years from 2003-04 to 2007-08, with an average annual growth rate of around 9%. Many believed that India was on its way to clocking consistent double-digit growth and comparisons with China were rife. It was conveniently overlooked that this output expansion had come mainly came from a few sectors: automobiles, telecom and business services.
Indians were made to believe that we could sprint without high-quality education, healthcare, infrastructure or banking sectors, which form the backbone of any stable economy. The plan was to build them as we went along, but then in the euphoria of short-term success, it got lost.
India’s exports of goods grew from $20 billion in 1990-91 to over $310 billion in 2019-20. Looking at these absolute figures it would seem as if India has arrived on the world stage. However, India’s share of global trade has moved up only marginally. Even now, the country accounts for less than 2% of the world’s goods exports.
More importantly, hidden behind this performance was the role played by one sector that should have never made it to India’s list of exports—refined petroleum. The share of refined petroleum exports in India’s goods exports increased from 1.4% in 1996-97 to over 18% in 2011-12.
An import-intensive sector with low labour intensity, exports of refined petroleum zoomed because of the then policy regime of a retail price ceiling on petroleum products in the domestic market. While we have done well in the export of services, our share is still less than 4% of world exports.
India seemed to emerge from the 2008 global financial crisis relatively unscathed. But, a temporary demand push had played a role in the revival—the incomes of many households, both rural and urban, had shot up. Fiscal stimulus to the rural economy and implementation of the Sixth Pay Commission scales had led to the salaries of around 20% of organized-sector employees jumping up. We celebrated, but once again, neither did we resolve the crisis brewing elsewhere in India’s banking sector, nor did we improve our capacity for healthcare or quality education.
Employment saw little economy-wide growth in our boom years. Manufacturing jobs, if anything, shrank. But we continued to celebrate. Youth flocked to low-productivity service-sector jobs, such as those in hotels and restaurants, security and other services. The dependence on such jobs on one hand and high-skilled services on the other was bound to make Indian society more unequal.
And then, there is agriculture, an elephant in the room. If and when farm-sector reforms get implemented, celebrations would once again be premature. The vast majority of India’s farmers have small plots of land, and though these farms are at least as productive as larger ones, net absolute incomes from small plots can only be meagre.
A further rise in farm productivity and consequent increase in supply, if not matched by a demand rise, especially with access to export markets, would result in downward pressure on market prices for farm produce and a further decline in the net incomes of small farmers.
We should learn from what John Treacy did right. He didn’t give up, and pushed for the finish line like it was his only chance at winning. Treacy had years of long-distance practice. The same goes for our economy. A long grind is required to build up its base before we can win and celebrate. And Ovett did not blame anyone for his loss. We play the blame game. Everyone else, right from China and the US to ‘greedy corporates’, seems to be responsible for our failures.
We have lowered absolute poverty levels and had technology-based successes like Aadhaar and digital access to public services. But there are no short cuts to good quality and adequate healthcare and education services. We must remain optimistic but stay firmly away from the optimism bias.
In the end, it is not about how we start, but how we finish. The disastrous second wave of covid and our inability to manage it is a ghastly reminder of this fact.