Direct approach to conservation
GS Paper 3: Conservation, Environmental Pollution and Degradation, Environmental Impact Assessment.
Prelims exam level: Not much
Mains exam Level: Environmental Conservation
Incentives for biodiversity protection
• Incentives for biodiversity protection and sustainable use include biodiversity-relevant taxes, fees, levies, tradeable permits, and Payments for Ecosystem Services (PES).
• Through these economic instruments, governments can affect both public and private financing flows for biodiversity.
• Mobilisation of biodiversity finance through pesticide levies, admission fees to natural parks, hunting and fishing permit fees, and the trade-in energy-saving certificates has gained governmental support and political will, but the mobilisation of private and public finance for PES has lacked lustre.
• Despite a solid theoretical foundation and the ability to tether investments more directly to outcomes, the debate revolves around the same issues from two decades:
monetisation of environmental benefits,
lack of additionality (how much environmental service would have been provided without conditional payments)
Ways for conservation
Payments for Ecosystem Services (PES):
• PES is one way to conserve and increase ecosystem services. It works through the establishment of performance contracts.
PES presents a unique scope for incentivising local land stewards to manage threatened ecosystems.
It has the potential to achieve the dual goals of conservation and poverty alleviation towards the achievement of Sustainable Development Goals.
This places PES as one of the pivotal economic instruments for conservation.
Status of PES in India and other countries
• PES has not achieved much attention either in the research or policy mandate in the Indian subcontinent.
• This is in sharp contrast to the successful implementation of PES in Latin American and African countries.
E.g., In South Africa, the CapeNature Stewardship Programme protects biodiversity on private lands.
Why have such economic incentives for ecological restoration not received academic, research, and policy prioritisation?
• A research paper in 2002 argues that any successful PES programme is one that overcomes the impediments to implementation.
• Such limitations include a solid institutional mechanism capable of simultaneous transfer of funds from buyers to suppliers, monitoring through investment in local capacity building, cost efficiency, the scope for development benefits, and maintaining the sustainability of funds.
The key to successfully implementing a PES programme
• A local monitoring mechanism is the key to successfully implementing a PES programme.
• A study conducted in the Kodagu district of Karnataka to restore native trees that grow in the understory of coffee plantations shows a successfully designed local institutional mechanism for PES implementation. However, the PES mechanism is yet to be implemented or even tested for efficacy.
Importance of impact evaluation
• Impact evaluation studies that evaluate financial instruments’ performance in attaining biodiversity are also important.
• The OECD (2019) Biodiversity: Finance and the Economic and Business Case for Action highlighted the importance of evaluating financial instruments’ performance in attaining biodiversity goals.
• According to recent OECD research, few thorough impact evaluation studies have been done for terrestrial biodiversity and fewer for ocean/marine biodiversity.
• The OECD advocates comprehensive impact evaluations and the formulation of strategic criteria to help determine which policies or initiatives warrant more scrutiny.
What would help?
• A strong policy thrust, such as the TEEB India Initiative highlighting the economic consequences of the loss of biological diversity, would help prioritise ecosystem restoration financing through a direct approach.
• A global initiative such as the United Nations Environment Programme Finance Initiative to mobilise private sector finance to benefit people and the environment would help maintain the funds.
• The cheapest way to receive anything you desire is to pay for it directly. This would allow the country to effectuate the nation’s commitments to achieving the 2030 agenda for sustainable development and the Paris Agreement on climate change.
TEEB India Initiative
• The Government has launched The Economics of Ecosystems and Biodiversity TEEB-India Initiative (TII) to highlight the economic consequences of the loss of biological diversity and the associated decline in ecosystem services.
• The Initiative focussed on three ecosystems, namely forests, inland wetlands and coastal and marine ecosystems.
• TII has been implemented under the Indo-German Biodiversity Programme as technical cooperation with GIZ.
• The outcome of the pilot projects will be fed into the sectoral synthesis for the three ecosystems.