The Uttarakhand government recently announced it will initiate valuation of its natural resources in the form of ‘Gross Environment Product’ (GEP), said to be along the lines of Gross Domestic Product (GDP).
GS-III: Environment and Ecology (Conservation of Environment, Environment Pollution and Degradation, Government Policies and Interventions)
Dimensions of the Article:
- About Putting a value/price tag on components of environment
- What is ‘Gross Environment Product’ (GEP)?
- Understanding Uttarakhand’s move regarding GEP
About Putting a value/price tag on components of environment
- The idea of valuation of the components of environment is not new and it got impetus following rapid degradation of ecosystems, which led to adverse impacts on more than 60 per cent of services we get from the ecosystems.
- The term “ecosystem services” was coined in 1981 to attract academics towards finding ways to address environmental issues. Soon, there were several publications defining and elaborating aspects of ecosystem services.
- “Ecosystem services” can be thought of as: the benefits human populations derive, directly or indirectly, from ecosystem functions.
- In 1997, economists and ecologists showed that at global level the value of ecosystem services is about twice as much as the global GDP.
What is ‘Gross Environment Product’ (GEP)?
- ‘Gross Environment Product’ (GEP) is considered as the product and service value that the ecosystem provides for human welfare and economic and social sustainable development, including provisioning, regulating and cultural ecosystem services.
- GEP is an assessment system to measure ecological status.
- Overall, GEP accounts for the economic value of the ecosystem in providing products and services, and it is one of the components of green GDP.
- Green GDP is an indicator of economic growth with environmental factors taken into consideration along with the standard GDP of a country. It factors biodiversity losses and costs attributed to climate change.
Understanding Uttarakhand’s move regarding GEP
- Uttarakhand gives services to the tune of more than 95 thousand crore per year to the nation “through its biodiversity”.
- A home to the Himalayas, the state has over 71% area under forests and it is origin point of rivers like Ganga, Yamuna and Sharada as well as home to wildlife reserves like Corbett and Rajaji Tiger Reserves.
- Hence, it provides a lot of environment services and in continuity as a result of which, there is a natural degradation in those services.
- The decision appears to be a welcome step, but going ahead with the jargon raises serious doubts on the intent of the government. It may confuse policy makers and negate the past efforts.
- The purpose of introducing GEP is not transparent:
- There is the issue of uncertainty as to whether it is
- A process of simple valuation of a state’s ecological wealth OR A process to assess what part of the GDP it contributes.
- An attempt to claim a budget from the center against ecosystem services the state provides to the rest of the country OR a process of providing benefits to its own residents.
-Source: Down to Earth Magazine