Narendra Modi’s maiden budget cut funding for environmental protection, but coal tax could help to accelerate decarbonisation.
The Indian government took some controversial measures in the environment protection field, as it cut allocation to the ministry of environment forests and climate change from Rs 2,043 crore (US $378 million) in 2014-2015 to Rs 1,681 crore (US $300 million), and also refused to fund new climate change adaptation provisions despite the recent disasters occurred in the country and linked to heavy rains and deforestation. In fact, instead of increasing appropriation for afforestation to achieve the 33% green cover goal in the country, it allocated only 1% of the total budget for the purpose.
On the other hand, the government also endorsed some environment-friendly measures, as it decided to double thecoal tax to Rs 200 ($3.25) per metric tonne and to channel the proceeds into the fulfilment of India’s clean energy plan, and drafted a plan to encourage the deployment of electric vehicles too.
India’s new policy could help solving financing matters and boost clean energy projects, but above all will reveal the level of carbon cuts the government could target at the end of the year, when the UN climate deal will be agreed.
According to the latest official plan, 110 gigawatts more will be produced through coal-based thermal power by 2022 in India, but many object that the tax is just symbolic, and that in any case coal companies would still be assured of a decent benefit. At the moment, 60% of power generation is mainly coal-fired, while coal-based thermal power factories are the most polluting in the world and are operating at only 60-70% of their capacity.
The gLAWcal Team
Wednesday, 4 March 2015