 Okay, let us get back. So basically, you know, as I said, different countries on different stages of development and different per capita income levels, etc. So how should these economies approach to achieve? What is the path to take to achieve economic development? So we just are going to give us very brief comparison. But in terms of the success or failure of those approaches or the pathways, which is often done in mainstream economic theories, mainstream economic textbooks, they do all these comparisons. But in terms of how environmentally benign these approaches are, how this needs to be done, etc. is what I have. So after that, we will have some discussion which is very clarification, etc. You can always raise your hand. So now the basic question that we are asking here. So from now on, actually, we just want to put it, pose it in the form of a question and then say whether we are able to find an answer. It is not necessary that once I pose a question that I will have an answer to all these questions. Sometimes I may not really have answers to these questions. So the basic question that we are asking is, are there any systematic association between the environmental conditions and the kind of development pathways or strategies that countries have followed? Is environment so bad in the US today because of the kind of development strategies that they adopted? Energy consumption, they are struggling to reduce because late 19th century, their model is basically in terms of personalized transport system, not public transport system. Obviously the energy consumption is very high in such situation. So they are unable to change the people's mindset to switch over to public transport system. One of the major concern, for example, for them, we switched over to personalized transport system only out of the infrastructure constraints and poor quality of public transport, etc. And even if you want, now it is not easy for us to switch over to public transport system. For instance, so one example is the, whether you go for public transport system or personalized transport system, Japan has completely switched over to public transport system, accepting in the case of few top officials and so because it is so difficult to drive the vehicle in the road because of traffic jammers and delays and all that. The first question is whether there is systematic relationship? The answer is, there are reasons to expect that there might be in view of the fact that development strategy influences variables which in turn influence environmental conditions. How do they do that? So that is what we try to communicate here. What does the development strategy do, whether development strategy of this particular government, previous government or across countries in the world? Everywhere development strategy is the road map for achieving your economic development. It tries to alter the structure of domestic production, service sector, manufacturing sector, agriculture, shares are changing, growth rates are different. So therefore, structure of domestic production, it alters. When you give more emphasis for construction, construction takes the lead. It alters the structure of domestic production. Secondly, the nature of the binding constraints facing the economy, that is what we are trying to do. What are the binding constraints? Financial constraints, people are not able to access credit. So remove all the hurdles, make it as simple as possible. Binding constraints, in spite of following public distribution system of food grains for 60 years, still there are starvation deaths, people are not able to receive the food subsidy and of every 100 rupees spent by the government, only 16 rupees value of it reaches the most needy people, studies have shown. So government is now wondering, should we continue to have this public distribution system of food corporation of India, procuring grains from farmers, distributing through the ration shops and others, or should we simply do a money transfer, cash transfer to the bank account of all the poor people so that they can buy from whichever shop they want. It will reduce the spillage. All the, you know, is lost in transit can be plucked by direct transfer of money to them. But then people who argue against it are saying, so that means there is change, nature of binding constraint, the constraint is changing. Now you have direct money in your bank account, you can use it. But then people say, what is the guarantee, they will spend it only on pulses and rice and wheat and not on alcohol. And whose account should we transfer to the lady head of the house or to the male head of the house? So they know guarantee if you give it to the male head, it will reach the family. All those issues will come up. Of course, so, but it will take care of one constraint, but not cannot be a foolproof system. But at least nature of the most binding constraint, it gets altered. I am just giving an example of this variety. Thirdly, technological and investment choices also change when the development strategy influences technological changes. We are switching over, say for example, ICT, massive investment in ICT has enabled all of us to be connected wherever we are. It is because ICT that we are going to be able to reach out the length and breadth of the country through this course. What do you wish for? If not for ICT, how can it be possible? In a typical QIP or CEP program that we conduct, maximum we get is 30 candidates in a particular. So how many times can we have to repeat ourselves? And how much does it cost when compared to this sort of mode? The institutional structure, new kinds of institutional structure, now we are talking more in terms of indirect regulations and direct regulations. You only have a regulatory role. It also affects the income distribution and domestic to international prices, which is what is called terms of trade. All that development strategy does. That is typical economic impact. Now, since these variables affect energy consumption, at least two examples I thought I will put it here, energy consumption and the pattern of land use in agriculture, it will have impact on the environment. Only because of two factors, two intermediate factors. Development strategy won't achieve impact, earlier factors that you discussed earlier. Now, because of them, the two intermediate steps, energy consumption and pattern of land use both changes for a variety of reasons. And therefore it can lead to environmental degradation. Let me give you some examples of cases here. Let's look at developing countries. Somebody asked me this question on which sector is using more and more energy. So if you look at environmental damage in developing countries, it can be discussed in terms of four factors. They are air and atmospheric pollution, water pollution and depletion, land degradation, soil erosion, desertification and fourthly, deforestation. Let's look at each one of them, air and atmospheric pollution. As you all know, energy generation and utilization emit hydrocarbon, nitrogen oxide, sulphide oxide and ozone into the layer. And places where energy producing and energy consuming activities are concentrated, the concentration of these pollution are high. That you already know. Now, in the specific context of developing countries, air pollution is aggravated by the use of energy inefficient technology with no pollution control and by the use of cheaper, high sulphur content, low quality coal and fuel oil, especially for heating and transport. Now, look at this, one of the WHO studies have shown of the 12 cities, worst population in the world, only 2 are in developed countries. Less than 10 are in developing countries. Okay, so even on good days, Beijing, Tehran, Rio have mean daily concentrations of SO2, much about 2.5 times WHO standard. Recent research has shown published in Economic and Political Weekly that the wear quality in Delhi improves, that the longevity of people living in Delhi will also increase. And they have done a lot of exercise on that. Now, so what is the problem? Problem in developed countries, cities are improving, those are developing countries are deteriorating. Largely because of unplanned urbanization, pressure of development and urban concentration. Right now, there is another workshop going on organized by my colleagues, right in this building on sustainable urbanization. That is one of the major issues here. But what about rural? Rural air pollution is also very high, particulates are running matters in various oxides, results seasonally from burning of grasslands and front forest clearing for cultivation and grazing, most common in sub-saharan Africa especially. And indoor concentration of carbon monoxide, particulates and hydropens also because of poor ventilation. Now, this is the table I was offering to the gentleman who asked me this question. The percentage of sector-wise commercial energy use, the developed and the newly industry, NIC are newly industrializing countries. Okay, together I have where 40% is for industry, commercial and residential use is 30%, 20% for transportation. But look at the poorest developing country. Look at this. Their commercial energy use is concentrated more and more on transportation, not on industry which can get them development. That is the worry. Energy consumption is high, emission is high, but development is also not taking place. That is where the worry is, especially in poorest developing countries. When you talk about poorest developing country, we are not included in that. See that is why I always say when we give a comparative perspective, please always remember you do not have to feel complacent that you are doing better than Somalia and Ethiopia, but it is also important that you compare yourself with what they are doing also. Last week I attended a conference on India and the Indian Ocean, a theme because India wants to be a leader for all the countries in the Indian Ocean. I thought who are all going to be there? Representatives from as far away Africa, till Indonesia, all countries in the Indian Ocean, they are looking forward to India as a leader for them. And they want India to play a major role for technology transfer for them in various sectors. We cannot undermine, we cannot say no, no, we refuse to play a role, etc. here. Now, when it comes to industry also in many of these countries, it is the composition of industrial output, most polluting industries. Now, economic survey gives the data on how many units are closed in most polluting industries, how many units are concentrating in most polluting industries. Again, uneven, in most of these industries, energy accounts for half of their total intermediate cost, and uneven use of energy across sector which makes it main link between development strategy and the energy consumption. That is the problem, that we are facing, uneven mix of use of energy access across sectors. Coming to water, two major water related are contamination, depletion, surface and ground water are being contaminated by agriculture, industrial, urban and human waste. Safe drinking water is a major problem, apart from sanitation. Between 25 and 75% of rural population in different developing countries do not have access to safe drinking water. And the results are several kinds of infections and short-term life expectancy. Now, what happens in developing countries is nearly 73% of water is used in irrigation. And still the productivity is low when compared to developed countries. And also developing countries account for 70% of the world's irrigated land area. But they require twice as much water as per acre as do the developed countries. Because of several other constraints, absence of economies of scale and cultivation and all that. But that's because you won't have, give them access to, you won't have subdivision fragmentation of land holding and several others because of your political compulsion, social compulsion. So how do we bring in? Another problem is land degradation, soil erosion, precipitation, cultivable land is a basis of likelihood for 80% of the population in many countries. Extremely rapid population growth, unsound agriculture practices. And thereby land erosion and desertification, etc. What is the magnitude of the problem? Gain soil erosion through the loss of topsoil either washed away or blown off the land. Estimates of the extent of desertification also very substantially according to the nation's environmental program. Two-fifths of Africa's non-desert areas, one-third of Asia's and one-fifth of Latin America are the risk of desertification. So something urgently need to be done in these places. Who is affected the most? The world's four are the most seriously affected. Since they depend on the marginal lands for this livelihood, they depend on this for livelihood. Population pressure, agriculture practice, poverty, price, policy and economic institutions interact to produce the devastating effect in the in mutually reinforcing cycle. How does it work? Let me give you a typology, a scheme, how exactly it has been put into place, how it has been working in many of these countries. Increase in population density, poverty and lack of alternative income-earning opportunity and land degradation lead to reducing fallow time below for, required for the natural restoration of soil nutrients. So this interacts with the use of biomass for fuel to reduce soil fatality. Attempts to respond to reduce yield by clearing more marginal lands are highly erodible, lead to further land erosion and greater loss of land productivity. Now with the increase in demand for land for say putting up solar panels, people are still looking at in terms of alternatives. But clearing of land or coupled with shorter fallow period also result in deforestation and deforestation has clear environmental problem. So widening and reinforcing the cycle of environmental degradation and poverty. So it affects the poor the most. That is why we in economic theorizing we really have to really worry about it. So the typical effects of, effects are in the form of institutional, technological institutional changes which reinforce other negative trends of agroecology. So that happens because the land change your problem and others. With commercial resistance of agroecology the problem only exacerbates. Because it leads to more intensive agroecology. Now on top of it you have poor land change your system. In fact we use all the committee reports only for the right reason. Let me tell you the first recommendation of the one of the committee report was implement land reforms in India. Nobody talks about it. Land reform continues to be a paper tiger. Now look at Japan, South Korea. If you are looking at them as role model of development who achieve fast rapid development in 20 years. In all these countries land reforms were implemented before they opened up their economy. We talked about land reform in 1950 and continues to be a paper tiger. Because the people who govern will be affected. Therefore it is it never gets implemented. Only two states have been good in sort of implementing land reforms. Singapore and Karnataka to large extent. Followed by Kerala, Tamil Nadu and few. So land tenure problem is a major issue in several parts of the country and also in several of these other countries. So what we are trying to therefore say is prevention is better than cure. So prevention requires integrated approach to the problem of poverty, rural development and the environment. You cannot say I will have poverty elevation program. I will only look at this. It is hard to design but more expensive and integrated rural development. Let me give my own personal experience here when we made an attempt. It is not that simply we talk about all this. We also try to do. So team of three of us from Jadavpur University Indians of Science Bangalore and myself took up one particular district called Chitradug district in Karnataka. And we tried to see the implementation of Narega Mahatma Gandhi National Rural Employment Generation Program. We were trying to say is because the act we studied the act and then we have also published this paper subsequently. The act says clearly that no asset can be created through the NRGA. Fair enough. Basically then I personally met John Therese who is the brain behind this act. He is now stationed in Nagabad University. He has been there for a long time in India, Science National. He is the co-author of Amartya Sen. So John said that I do not want it to become a source of economic power for anybody in the village. We do not want only unskilled people to be employed and no asset to be created. But I said then people are telling you John it's becoming digging your hole and filling up of the hole. So it makes even some of others. Some of my colleagues in engineering disciplines tell me that why don't you advise the government to simply transfer the money to people's bank account rather than employing them digging this hole and filling up this hole. NRGM also should be money transfer only. I said no, no, no. The idea is to create employment, not money transfer. But the act says you can't create assets. So we three of us work on in the area of environment, economics and environment. We said why don't we create? You don't want other assets. Why don't we have natural resources? So we said how to bring in ecosystem services in NRGA investments. So we took a case study of Chitraduk and said this can be done and how exactly what kind of ecosystem services can be created using the same NRGA money, no expansion money, same people employed in the same area where you are spending this. We came up with an action plan. We were invited by the government. So rural development ministry which is supposed to handle this, they said you come for presentation. So we said why don't we invite some people from ministry of environment and forest also. They said no, no, first we will discuss. The biggest problem in India is in the government, the right-hand doesn't know what the left-hand does and they don't interact also. So why present that here? We have three office personnel. They said this is exactly what is possible. They said fantastic idea. Ecosystem service is not violating the act because this is an act passed by parliament. It's possible to do all that. So why don't you do one thing? We are glad to implement all this. But let us begin from Northeast India. So my other two colleagues looked at me. I said I have no problem going to Northeast India. We can do that etc. But ecosystem services, if you have understood what they are, is that area deprived of ecosystem services? Why don't we make a beginning from semi-arid zones where it can have a huge environmental impact? I am not naming any state or any district here. I am saying semi-arid zone where it can have immediate impact because see this flora and fauna of the states, the districts there is much better. They have different kinds of problem. You first go and implement energy there. But yes, we are saying energy, you can do all this. Doctors only if you are interested in going to Northeast. So we said okay, let us see what we can do etc. It was just to make sure that it doesn't take off. This is exactly how, but of course, there is a research paper published out of our own interest that we did the study. So how it is possible? Prevention is better than cure. Where it is possible to create these assets? In these places, otherwise they were only having, see what is called a check dam. Rainwater harvesting and others. That is a good thing. But if we can also have ecosystem services using existing policy of the government, we are not asking for a new change in policy. You are already spending money. You are employing people. Let us create. So deforestation in the sense of unsustainable free clearing interaction with land degradation is mutually an opposing cycle. But one person of tropical forests are destroyed each year and the rate of deforestation is also accelerating. Two thirds of the less developed countries, tropical forests are in Brazil, Indonesia and Zaya. Okay, therefore you can imagine which of the countries are going to be affected by the deforestation. Causes, you know already, what are the causes of deforestation and human and natural calamities, war, forest, fires, also there, apart from industrial fuel, wood consumption, etc. It leads to three kinds of effects, soil erosion, flooding, desertification. Again poor are the harder state and since they live on the most marginal soil and they also use on gathered wood for cooking. Now it is very important. We talk about flood impact, extreme even sea level rise, sudden increase in rainfall, flooding, etc. So I will tell you two examples of what which I was involved in calculation. So there was a deluge in Mumbai that many of you know and insurance companies gave lot of information to researchers and there was a big presentation in Mumbai I was also invited to comment on the work where they calculated the total loss they pegged the total loss as 5000 crores of rupees. So we were basically trying to find out how did we arrive at this 5000 crores. So then they disclosed to us this a team came from Paris. They said, they disclosed to us saying that this is based on the data given by insurance companies. So I intervened by saying that look there are several economic activities that take place in colonies which are inundated by water for one and half days at least in that period. These people's livelihoods, source of livelihood or whatever small industry they have are not covered under the insurance. Have you imputed value for that in calculating your loss? No. What are you talking? They asked me. So we took up that study. The government of Maharashtra said yes we want this also to be tabled. So they said why doesn't IID Bombay do this estimation? We estimated did a survey of all the people who are living in this Kurla and other regions, various ward numbers because BMC has data about which wards are affected how long, what is the height of the extent of flooding and for how many hours etc. So we collected, so we visited we had employed people visited all these places calculated by talking to them what are the economic activity and what they are doing etc. And how long will it take for them to come back to put the clock back? Most important that's why we need to be sensitized. How long would it take for them to put the clock back to the level that they were the previous day before deluge? On an average we found it to be 11 months. So we did the calculation and the total estimated loss of all this what is called urban informal sector in the Asia came to 1100 crores. So that need to be added to the figure given by insurance company and these people don't have any insurance to fall back upon. For many of them it is source of livelihood. In fact in my earlier paper that they follow the best style of Japanese style of management just in time production. Reason being they have neither have the capital investment support nor do they have space to keep the inventories. So they work on just in time production and therefore the loss is minimized if they had worked like any other enterprise in other parts of India, not in Mumbai which has space constraint. Their losses would have been more. With this constraint the loss is 1100 crores of this all this sectors and it is source of livelihood which they have lost. We are not talking about human loss of human life we are only talking about loss of resources which give them income and consumption for the whole family and in all this what we calculated the estimation. So that is what is definitely required when I say example of poor or affected this is what I mean differential impact because there is no insurance coverage for these people. As we all know economy is the integral part of an individual institution level. But how much action the environment is being upgraded or audited by the economic policies laid down by the government and non-government organizations. What is the action it is already upgraded and how much action is needed to be upgraded? It is wherever it is mandated we get involved in doing this valuation otherwise we don't because it is really required it is only those out of research that they try to do they don't do beyond that unless it is asked for environmental audit is very different from it is not necessarily economic audit say environmental audit like your chartered account need not know economics they just have to check whether you are input in all the incomes and expenditure that is all that is the role of chartered account environmental audit we look at it purely from environmental point of view we have to look at it in terms of who is affected etc. I cannot say Maharashtra government that 5000 what Indian government you should take it as it is you are elected by people for the people you look at what is lost to the people source of livelihood is lost for them and who is going to compensate for them that is the kind of sensitization that is required for no fault of theirs sudden downpour of rain so that is why it is important to talk about this of course it also has adverse global effect in terms of what happens in tropical forest etc loss of species and several others that you already familiar I am skipping some of this and then you try to bring in forest management in that context only why it is required how exactly forest management is going to be done okay and what can we play through policy intervention so all patterns of economic development lead to environmental damage and when you try to speed up accelerate economic development put like further on the accelerator it leads to rapid increase in environmental degradation but all environmental effects are amenable to policy influence at the margin I am not saying totally but we can sort of put this back now here so it is important that when you come up with the development policy also keep in mind the environmental policy the environmental policy has to come back with what is called invisible land Adam Smith talked about invisible hand in development when you leave it to the market to decide when you take a decision how do you go yourself to the market and buy something we say in market sort of situation you are led by an invisible hand somebody takes you you do not know who is I am not talking about supernatural power we say that it is based on your own rational thinking your understanding knowledge that you go and take this thing generally when we try to take decision for the short term and when you work on self interest from the resource mining policies at the expense of the longer run generally at least some of the poor etc then we will have to see what happens how can you be charged for benefiting everybody else ok so that is why the policy should play a role and when you formulate the policy again they come back to this question are there some development pathways or strategies that are environmentally better than others can we follow them or at least can we know can we avoid some development strategy which are desirably worse than others from an environmental point of view that if you are aware at least we can avoid even if you are not able to achieve the follow the environmentally benign strategies that is exactly what of course there are what is development strategy itself varies from country to country and for the same country over a period of time they are distinguished from each other in terms of interrelated instrumental dimension in terms of pace of development and primary engines of growth should India now embark upon 10% growth rate of GDP is a big question again debated and what are the primary engines of growth should we depend more on service sector more on agriculture more on industry and within industry which sectors should we depend more on construction the US and Japan believed in automobile led industrialization we did not follow that it is automobiles that led the development in those places so it is also possible to cluster the countries in the world now in terms of different development strategies that they followed and which are followed same development strategy or similar development strategy however there could be differences in countries cluster along these dimensions because one can also same country need not remain in this cluster for a long time for example we also have a closed economy for a long time we opened up after 91 China opened up from 1978 Japan opened up from late 1960s so it is South Korea and other Singapore etc so there different countries follow or in different development strategy during different phases of the development so there can be sectoral lines development like industrialization balance growth, agriculture development let also distinguish along the lines of trade inward or outward oriented possible for example, development strategy adopted by Norway and Denmark are very different from what Korea and Indonesia adopted although at the outside it look like all these countries are dependent on agriculture and using agriculture to support industrialization Norway and Denmark did not go for the kind of agriculture intensification that Korea and Indonesia have gone that is why there is more sustainable they also depend on allied sectors of agriculture like animal husbandry dairy they support agriculture and this sector supported each other we haven't gone in for many of this so major development strategy that you can sort of formally classify in terms of export promotion import substitution or balance of agriculture and industry sectoral growth, staple export strategy like African countries Sub-Saharan African countries which are to export all the staples in order to receive the commodity that they need to consume from other countries or agriculture development led industrialization like Korea that's also various possibilities are there so are there something which is desirable some evaluation is also being done so that could be sort of depending upon how much time we have in your courses etc so that's something that I thought I'll share with you my question is that when we are running behind development the same time we should think about that how much that development is required since we should not run like we want to become the leader so that's why we should develop so what happening when we are developing more and more that the gap between rich and poor is getting wider so that should be the first we should keep in mind how in society how the equitable distribution of income can be restored then we can think about development so this development should be in another term it should be environmental friendly oriented and peace instead of running and becoming the leader in the global scenario so my question is actually how much development we want I agree with you on the first part you know development should definitely that's exactly what I'm trying to say development should take into account the equity as well as environmental impact etc how much development you want is a big question that even you know Obama will not be able to give an answer on because how much development also varies from country to country because what is happening here is can I say I don't need development when I know there are starvation deaths in Kalahandi how can you say that so my development should be inclusive then my question is that as an economist we should have understanding actually how much for example I'll feel peace when I'll drive one Bharati Alto so I don't need that Mercedes Benz so Nelson say I will be peaceful when I can walk around the streets so what do I do that actually for that reason we should have let's some bear actually up to what we should develop it not for we want to become from developing to develop so we want more GDP so so that to keep all these things and environment, peace everything in the mind everybody will agree with you definitely because there can't be any dispute about you need to keep them in mind but that does not necessarily mean that we sacrifice on development also so what I think you need to understand what other countries are trying to say is they are looking at India not in terms of development in terms of you know source of technology knowledge we look at the West so there's a transitivity that takes place and here is an opportunity for you to play an important role I'm not saying you have to when you become an important play you behave like yours actually in economy we have different like balance growth strategy is import substitution strategy all the strategy why don't you have some like peace oriented strategy and developmental issue so we should have some like peace oriented and environmental way of strategy so that I want to know from you environment and peace can also be in conflict let me tell you if I go for peace oriented I may not be environmentally benign or the other way around if I'm environmentally benign I need not necessarily be peace oriented so that's a very highly debatable issue ok while keeping these in mind is fine but I don't think it's possible to formulate strategies for peace and environmental benign together ok that's my response that is the entire relationship between the economic development as well as the with this in relevant to the environmental perspective so then the cost effect of the pollution that is also then the cost benefit analysis of eco friendly approach and then the role of current environmental policy that is in perspective of the economic development and all said all together say ask this no see the whole idea is to you know when we sensitize people it's important that we first of all establish the link why are we talking about it because see I even go to the extent of telling them from the placements why are you joining IIT Bombay why not other institutions they give n number of reasons but ultimately one of the factor that you keep in mind is that you get excellent you are hopeful of getting excellent placements so it is eventually excellent placement in monetary terms apart from learning assuming that you know you come here for learning and you get the best out of it fantastic which is required but that is also definitely important now when it comes to this therefore you know you sort of you talk about personal economy as well as economy of your country and then link it to why it is important that we also when we do all this we also talk about care for the environment on which we depend on development itself is dependent on which need to be established like energy waste management and several others ok so in the process we try to say what kind of policy measures that are required to achieve development which is also environmentally benign not necessarily peaceful ok so is it possible to achieve yes it is possible to mix so there it is important that you continually evaluate and that evaluation is done through cost-benefit analysis that is a tool that is exactly what I am trying to say use the tools to evaluate and tell them that this it is possible and it is scientifically done it is not that evaluation is done because he likes to go by alto and someone else would like to go by bicycle there you bring in normative value judgments you may be fine with alto because that may be consuming lesser fuel than say Volkswagen but what about somebody who says I want to use only bicycle definitely he is better than you is more environmentally benign than you is not it so therefore perceptions comes in but it is not simply one of perception what we want to say is that a scientific principles are applied to make comparisons and then say which is among the several parts that are available to you that means without compromising on economic development you can also be better off environmentally you can mix this get the correct combination based on scientific insights is what we should tell the next generation so that they trust you they believe you and then they take you seriously otherwise it becomes my opinion or his opinion or your opinion so according to the second law of thermodynamics say entropy cannot be avoided sir so entropy cannot be avoided so it is spontaneous in one so in case here the environment concern so we can avoid or we can tolerate or we can adjust no sir is it possible that is for the scientists and engineers to answer as an economist I say economic find of you I am asking sir no we are trying to find out I mean let me give an example in 2008-9 I was part of a committee which was trying to calculate whether we can go in for international oil prices were increasing already reached $158 per barrel so we are trying to calculate can we now switch over to solar so there was a team that came from Calcutta made an excellent presentation to us grid based solar power generation and distribution which we have been thinking is very expensive and they also we did so the committee was headed by Dr. R. Chidambaram was principal scientific advisor so he said Narayanan can you do some rough estimation and told me at what price of international I mean crude oil price will this become beneficial to us so that we can convince the government grid based solar power generation distribution you know how costly it is captive power plant is different so then we I did some back of the envelope calculation right there he wanted in 5 minutes so found out that if the international oil price hits $183 a barrel this will become economical because obviously to when you talk about finance ministry or other you have to say which is better cost wise we are not talking about environmental benefits here simply in terms of economic cost assuming both of them can give us so much of power so he said okay then we will wait so I did the calculation only gave it to him he said okay he told the others also he has done the rough very rough estimation will keep that in mind let us look at the you know oil prices oil prices crashed in next 3 months to $48 they said then we do all this error to keep quiet where is $183 where is $48 nobody will buy this argument so that is the cost of comparison that one has to make so again entropy etc for us it is in terms of this cost possible at any stage that solar power will become far more cheap than I just answered that on the basis of the then existing technology I mean it is all up to us to have technological breakthroughs solar becomes cheaper or economical we are hoping that solar cells my colleagues who are working on solar cells will make it cheaper so it is all now eventually depends on the cost of solar cell isn't it so in 1984 the Bhopal guest HD was there and as a result of that thousands of persons have died you say you informed us that in international court of law court of justice in the hay in other lands they have fixed the compensation as per the Indians value of life as 2 lakhs no I am not saying no they have fixed on the basis of sorry I did not say the amount I did not say the amount I said they said you cannot expect a multinational company to value the life of a citizen of a country more than by its own government I only said that just I want to know what is the basis of fixing the value of life of a person by the government I will admit I don't know I don't think we should get into that exercise that is not the purpose we economists don't do that in fact I am objecting even to economists getting into valuing tigers and monkeys natural resources is fine but that's not the way we get into even for cattle which support your agricultural activity or other isn't it we don't we should not get into I am not in favor of that but still people do engage in yeah we don't we don't know the value sir you mentioned that you were you had been to couple of committees quite some of them are quite important and you also mentioned that what I heard correctly that most of them that the recommendation or presentation that you have made finally had not been considered in a sense some of them have not been implemented some of them those are equally important than the others which had been might have been accepted we all know who decides finally I also don't know our job is to sort of inform the government and make an attempt now that means the role of academic stops there no the thing is that some of the economic principles and theories which you are a year back to the previous government was seemed to be very relevant now those same principle these governments looks very irrelevant and equally a Nobel laureate economics economic principles cannot change with the change of government so that's what now the person who used to be very relevant previous government now his theories looks irrelevant no I don't think that is where the perception for there in their perception may be relevant but it cannot lose their relevance unless somebody challenges them theoretically it's not theory cannot change theory cannot become relevant for one person and irrelevant for another government policy suggestion will definitely change with change of mind change of people change of mind and therefore change of approach to development sir just a continuation of what he was asking the international court of justice said they cannot pay more than what the local government values the life of the person it rules because every single mark as an example of why one should not get into valuation but then every human being is there in every country is a resource so as part of resource don't they have the value I believe so differently I think all of us are valuable to our country so in terms of value can we be converted into the currency that's what I'm not in favor of okay your insurance companies will do that yeah yeah depending upon your age and my age but and our health conditions but I don't think that's the purpose it doesn't serve any purpose that's exactly what I'm trying to say in terms of resources also natural resources you should do because of green GDP sir in Europe actually there are lot of rumors are going on that like there is going to occur the third industrial revolution people are going to change their cars from petrol to fuel cell whether it is possible sir whether it is adaptable for India also there is there any chance see one of the major I'm not sure about what's happening there but one major factor that we are always worried about the cost keeping the cost low so it's affordable yes sir so whether it is possible with India sir we don't know the cost I know the cost I cannot be commenting on it thank you sir thank you see when I was just asking someone Nikhil I guess sometime back that 10 years ago when mobile phone was introduced at least I thought many of you would have also thought that you know it's going to be beyond our reach but today people working in tea shops also have mobile phone so such breakthrough comes it may become economic respect to your presentation I saw one slide GDP versus the ratio between the GDP and energy energy per unit but actually the trends goes down it's not a favorable trend actually the ratio between the GDP and the energy cost how much energy you are consuming per unit of GDP produced that is going down is good no which means energy saving you are saving on energy when you are energy consumption okay okay I thought it's energy consumption okay sir one more thing it's something general it's the cost of petrol why do we have always on a higher side and compared to the neighboring countries it is some neighboring countries it's gone down to India also now they are saying 24 rupees Bengal they are saying 22 rupees okay no I can tell you it's purely economic reason you know sometimes we would like to fix price for certain commodities and services to discourage you from consumption also then that should be the case for all even for the car everything should be no if you do that cost of transportation goes up the new and I will spend them we have to be given more transport elements so governments non plan expenditure will go up can't be unreasonably high this is something related to the green GDP side one among the recommendation in the sustainable development practice the quality of the product its durability is to be considered quality of product durability okay it should be better the quality it will be better for the sustainable development the cost or the fact is included in the green GDP green GDP doesn't really talk about that in fact since you asked I am just coming to that you may have the question I answer for that I am just quickly tell you how green GDP is done if you have any I will just go ahead I had interacted one of the IIT and project associate yesterday I had a dinner with them yesterday night even I am unknown to them there was an excellent work is going in IIT energy department of energy they have a tie up they have invented solar lamps and they have tie up with one of the industries at Charlapadli Hyderabad and they have been manufacturing the electrical lamps these lamps have been distributing on sale across the India today the figure is 8 lakhs lamps have been distributed to the students children school children I am in the advisory board of the school what I want to ask the question here and out of the 10 lakhs 8 lakhs have been already being distributed the goal is to just supply these distribute these lamps to every boy school boy length and breadth of the India they want to distribute it now I want to ask one thing have you got doing any kind of the statistical research how much of this economic saving you would have on this actually replacing the non-renewable energy by giving the solar lamps replacing the conventional this thing are you doing any kind of the research work on the economic statistical point of view you have any research trains on this and research I want to ask this and one more thing is I want to just convey to the organizers sorry because there is section will be written afterwards in the thread of this you know delivering the lectures in between why can't you invite such a research associates who have been developed a small sample model so that in between the actually the lecturers the research associate project associate will come make it display talk to the people interact the people so that the people will go to the institution not only the giving a text knowledge as well as what real research of the work is going on so that more and more you know things could be improved in a better way so that's my intention I want to ask you at the point of the context you are delivering the economics about actually the part of the environment on the you know the solar lamps what you have got in the statistic please explain me well I can have a detailed discussion with you on that yes there is another colleague in the name of Narayanan, Dr. N.C. Narayanan I am also the advisory board of the project where we are looking at socio-economic impact of solar table lamps distributed to children studying in school mostly in villages remote areas we are studying the socio-economic impact therefore the environmental impact also already undertake we are already doing that study this is a major initiative IED Bombay which I think is a very very satisfying thing for us thanks for asking we are already doing that study results are not ready for us to disclose but the study is already on now coming to green GDP estimation quickly let me tell you how is the green GDP different from conventional GDP first of all you have to understand how the conventional GDP is estimated does anyone know here who estimates GDP for our country do you know who is responsible to estimate gross domestic product for let us be answered by non-economists you have been trained as an economist ok Central Statistical Organization Government of India under the Ministry of Statistics ok now they have different methods different countries use different methods by and large we have value method that is value added approach expenditure or the income approach now since I assume that you know what is GDP and therefore NDP NDP is GDP minus gross domestic product net domestic product net domestic product is gross domestic product minus the depreciation of man-made capital that is wear and tear of machinery and others that we use so the depreciation allowance if you deduct from GDP net domestic product that is what we do and NDP at market price gives you national income and you divide by population you get per capita income ok now for national income sometimes we also add here apart from NDP to NDP we also add net factor income from abroad that is Indian working abroad sending money to the families here minus foreigners working in India sending money to their families there that becomes the GNP or national income etc now green GDP was included basically to check how sustainable your development process going to be so green GDP is defined as NDP minus IEC imputed environmental cause where IEC is defined as depreciation and depletion of the natural assets now this obviously means it has to be a number it has to be evaluated and examined etc so IEC is comprised of economic cause induced by natural resource depletion destruction of the ecosystem degradation of natural assets as well as air and water pollution now there are several methods and research continues on this environmental and economic accounting SEEA is being done and now like the GDP conventional method that is being adopted by various countries there are international forums where it is being discussed so that everybody adopts similar measure so that your GDP becomes or green GDP becomes comparable the dispute that our friend asked earlier China etc there is a lot of discussion about what should go on in that accounting similar debate took place in the case of GDP estimation also long long ago but now that is sort of agreed upon green GDP the discussion is not for the last 20 years so several rounds of discussion now the sort of basic what I am going to present to you is one of the fundamental methods that is used to estimate this of course lot of refinements and developments have come about in this maybe we can take it up we can calculate and show them how exactly it is being done etc now let me give one example because of the positive of time calculate the rate of depletion and for resource and for produced natural assets such as forest the cost of depletion is equal to reproduction cost of the net reduction of resource so simple formula that we look up we make a distinction between renewable and non-renewable okay now the concept of user cost how exactly user cost is calculated so here we assume look at two scenarios one as if the resources available infinitely point that Nikhil was pointing to me that you economy assume the resource available infinitely and alternatively as if the resources available only finite period we calculate user cost under both the scenarios and then look at what happens here is the formula is very simple this is what it is which is taken into account to user cost of all the resources that are used in your production process and this is basically finally reduced into so we are assuming that IRE should be equal to IR this thing into total revenue from both the process should be equal so that you can deduct it from the GDP in terms of only the resource so finally this is the formula that by substitution we can get this user cost should be of a particular resource is into 1 plus r to the power minus n okay the other components that we look at like some of it we actually do not value at all I say that is important that we value forest cultivation non-economic assets say for example water and air we do not impute value so if it is polluted how do you estimate the value how do you deduct it from what is the cost of pollution so abatement cost is what we marginal abatement cost is what taken as a estimation of for the calculation of input environmental cost here okay so basically we use marginal abatement cost same for water air and water both we use the marginal abatement cost now you must note that we are not indulging in damage estimation because there are two different approaches to social cost of animal degradation okay now for example in the case of air and water pollution the impute environmental cost evaluates the social cost in terms of expenditure to prevent pollution emission on the other hand the environmental damage method measures them on the basis of actual losses of production on the medical expenses or social cost of the society has to be here sometime people value you know value lost when there is a strike or lock out or today people are declared themselves sick for watching match can you input loss to the economy because so many people are not reported to work okay now so do we include social losses obviously it is not possible so therefore this also has limitation only in terms of the purpose for which it is need to be calculated etc. so we are aware that animal degradation can manifest in terms of rising conservation of pollution resource depletion etc. okay what I wanted to definitely tell you is animal degradation can be characterized in five ways sources receptors intermediates environmental process linking sources to for example given example in each of these some dwellers are basically receptors increase in economic activity like automobile chemical and intermediate environmental process linking sources to receptors and agents social agents to environmental degradation, feedback or response to socialism, social determinants of economic activity like population, livestock growth etc. but here you must in economics when it comes to any such calculation of GDP or this thing in macroeconomic sense the first and foremost we tell students to distinguish between stocks and flows are you talking about stocks? are you talking about flows that distinction is extremely important stocks are basically investments goods and others which are already there flows are for IIT Bombay stocks is all the classrooms and other facilities that are there flows are students who come and go so we keep that sort of that stock and flow is very important. So here we talk about pressure indicator impact indicator sustainability indicator etc where pressure indicators are by and large flow variables because pressure can change and it can also cross border and impact indicator also reflect the impact of pressure on the receptor now but sustainability indicator the moment you bring in normative valuation comes in while the other two can be simply based on so this is exactly what I say that is why sometime people call economy as dismal science because there is a normative valuation that comes in then the your perception comes in so the picture difference between current and reference value but then your value is your personal value judgments coming that is exactly what we need to avoid otherwise it becomes a voice in favor of the person who is looking at it etc ok so we have identified so what we also will be sharing is how is it possible is sustainable development only a myth or is it possible to operationalize 4 steps that we are going to be talking about how to implement sustainable development ok so I think I have few more other slides etc but I think in the interest of time I will stop here so basically what I want to say is what we intend to do is introduce this you know interaction between economy and environment you bring in what kind of development approach pathways are better and which are environmentally differently disasters concept and measurement of green GDP and formulating policy to achieve sustainable development I think we will that is exactly what we cover in this there any points you want to talk maybe one quick question social impact social impact assessment is itself is a tool that we will have to we need time to explain it is concerned to human part in it in the same manner how the economically economy can be connected entire economic activities for you and me human only how the decision is being taken on based on the human instead of going for any mathematical decision is taken by you and me for ourselves if we do not have stomach to worry about there will not be many economic problems isn't it so it is for us taken by ourselves that's what economics is all about so in last slide sir you have shown some equations to calculate the damage to the environment okay some equations are there is it possible that two different persons calculate out the damage to the environment would be different discuss and arrive at the consensus on the methodology internationally but same methodology is adopted then also is it possible to have different then it should get the same result that's why you you don't do social valuation will differ because life is valued differently in America and India for the same individual sir does whether the green GDP depends on the natural impact natural impact yeah yeah definitely yes