Govt may tweak policy for infra projects in forest areas
NEW DELHI: The Union environment ministry proposes to increase the net present value (NPV) of forests that will be diverted for infrastructure projects, linking it to a measure of wholesale prices, a development that could have a significant impact on infrastructure projects that are to come up in forest areas, raising concern among policy analysts who say it sidesteps issues such as conservation .
NPV is the upfront payment made by various infrastructure projects for the loss of forests and its ecosystem services, and is used for various conservation efforts by the ministry.
NPV is calculated depending on the density of the canopy and quality of forests.
In 2002, SC had directed that infrastructure projects pay NPV for the forest loss while hearing the TN Godavarman Thirumulpad Vs. Union of India case related to forests.
But the ministry has decided to not increase the NPV values in line with the recommendations of the
Indian Institute of Forest Management (IIFM), Bhopal, which had estimated in 2014 that the values should be raised to nearly four times the present value to reflect the real cost of goods and services of forests.
Instead, the ministry has proposed to use the wholesale price index (WPI) to determine NPV values for the time being.
“The NPV will have to be revised because Supreme Court has ordered that it be revised after three years. There is a delay in revising the value already. This is a draft proposal only. We don’t know if it will be accepted by the government,” said a senior environment ministry official on condition of anonymity.
Even using the WPI as the yardstick for revising NPV, there is up to a 51% jump in NPV values depending on forest types. For example, the NPV of a very dense, Class 1 category forest is Rs 10,43,000 per ha, which will increase to Rs 15,74,930 by tying it to the WPI.
The IIFM had classified forests into 14 forest type groups and individually determined the NPV based on goods and services like timber, bamboo, fuelwood, fodder, gene-pool conservation, carbon sequestration, carbon storage, soil conservation, water recharge, pollination and seed dispersal.
“The ministry’s document reveals the serious difficulties involved in valuation of forests. This was very challenging even for the Central Empowered Committee (CEC) when the Supreme Court was hearing this matter {in 2002}and the final result of that process was wholly undemocratic,” said Manju Menon, a senior fellow at the Centre for Policy Research think tank.