Mains Paper 3: Environment | Conservation, environmental pollution and degradation, environmental impact assessment
From UPSC perspective, the following things are important:
Prelims level: Not Much
Mains level: The possible solutions of countering the issue of Smog.
- The article talks about the current environmental issue of smog and proposes some solution for it
What is the issue?
- Smog: The public health emergency
- The callous response by various government agencies
- Every state blames the other
- The weak policy response is also an indication of an institutional vacuum to deal with public goods issues in a federal political system
Is it possible to change the incentives for farmers who burn biomass?
- The standard economic solution is to impose a Pigouvian tax on farmers to ensure the polluter pays for his actions
- Such a tax would change incentives by increasing the cost of stubble burning
Ronald Coase way of dealing with the effects of stubble burning
- Coase argued, in a landmark paper published in 1960, that the solution to externalities such as pollution is not unilateral action but complex bargaining between different interest groups
- The bargaining will be based on how much farmers value stubble burning on the one hand and how much city dwellers value clean air on the other
How can it be implemented in India?
- In the case of the smog in north India, it could mean that farmers should be paid to invest in better technologies to deal with the stubble left over from the previous harvest
- A subsidy will change their incentives. Such a Coasean bargain is premised on two preconditions
- First, property rights need to be assigned
- Second, there needs to be a credible agency to manage the negotiation
- India has neither right now
More practical solution
- The more practical solution is that the state governments of Delhi, Punjab and Haryana be considered the representative agencies for their respective citizens
- They should negotiate on how the cost of changing farming practices will be shared. A first step will be to estimate the amount to be paid for every hectare of farmland that is shifted away from stubble burning
- The second problem is the lack of an institutional structure to deal with such federal negotiations, especially when the three state governments are run by three different political parties
- This is where the Union government needs to step in as a coordinating agency
- It can also offer to bear half the fiscal costs of any green bargain between the three states
What can we learn from the US?
- A better solution over the long term is to set up a federal agency like the Environmental Protection Agency in the US, with powers to get states to the bargaining table
- The exact contours of such an agency will need to be debated by climate change scientists, economists, environmental activists and political parties