Environment

Green Gross Domestic Product is the index of the Economic growth of a particular country which enshrines the environment consequences of the economic growth.

Green GDP does not mean the monetary value of the Forests etc.
Green GDP does not mean the growth of Green Investments.
Green GDP means that it accounts the monetized loss of biodiversity, costs caused by climate change.
Green GDP is conventional gross domestic product figures adjusted for the environmental costs of economic activities. It’s a measure of how a country is prepared for sustainable economic development.
This means that GDP may have some indicators such as Waste per capita or CO2 emissions growth/ decline.

It was China which announced as early as 2004 that a Green GDP with Chinese GDP Index will be released.
China, a pioneer in the factoring in costs of environmental degradation into economic growth estimates, first published its green GDP data for the year 2004 in 2006.
But it is India which has given the most promising national activity on the Green GDP. In 2009, India’s Environmental Minister, Jairam Ramesh had announced that “It is possible for scientists to estimate green GDP” As a consequent to this, an exercise was started under the country’s chief statistician Pronab Sen. India’s GDP numbers will be adjusted with economic costs of environmental degradation by 2015.
Green Gross Domestic Product is the index of the Economic growth of a particular country which enshrines the environment consequences of the economic growth.

Minister Jairam Ramesh made a statement today on providing a Green GDP alternative, opening a new front in the Copenhagen discussions. If taken seriously Green GDP can bring significant changes in our behavior as a society.

What is Green GDP?

Green GDP has been used by economists and policy advocates as a national accounting measure that takes into account ecological and human welfare considerations. a way of better understanding the implications of economic activity for environmental integrity and human well-being.

Crudely defined, Green GDP = GDP accounting + natural resources accounting

However, placing a monetary value on pollution and resource extraction is controversial and presents methodological difficulties.

Need for a Green GDP:
defining metrics to get the right behavior
For years, economists and politicians have wrestled with the concept of rising Gross Domestic Product (GDP) as a measure of progress. Even the father of national income accounting, Nobel laureate Simon Kuznets, warned that "The welfare of a nation can scarcely be inferred from a measurement of national income.”

Because GDP is measure purely on an income basis, societies in the last century have focused purely on GDP enhancement.

Since the early 1990s there have been several attempts to develop national income accounting systems which recognize the negative impacts of environmental degradation and income inequalities on economic welfare. China attempted to use a Green GDP measure and it conducted a study in 2004 (results released in 2006). It showed a financial loss caused by pollution was 511.8 billion yuan ($66.3 billion), or 3.05 percent of the country's economy. A year later in 2007, China abandoned its Green GDP effort, when it became clear that the adjustment for environmental damage had reduced the growth rate to politically unacceptable levels, nearly zero in some provinces.

India Green GDP alternatives by 2015?
Minister Ramesh is no stranger to policy and economics having formally studied technology policy, economics, engineering and management; and having extensive experience in implementing policy. So we feel he knows what he is talking about.

In his statement in New Delhi today he stated that India aims to factor the use of natural resources in its economic growth estimates by 2015. "I think certainly by 2015 or thereabouts India should be in a position to provide alternative GDP (Gross Domestic Product) estimates which account for the consumption of natural resources as well," he said.

This is a bold statement. It definitely strengthens India’s position during negotiation. And it is an extremely bold position if it is followed through because it could mean a very different India in terms of the metrics the government ministries and agencies will start tracking. It is well known that metrics influence behavior! (And what if other nations follow suit?!). Minister Ramesh definitely knows his economic multiplier effects.

Are we in for a November fireworks? The ministry plans to introduce a bill for a National Environemnt Protection Authority, and there is chatter about sops for renewable and cleantech enery sources.