Our successes in exporting services have been our main source of growth since liberalisation. These are envied worldwide, yet our merchandise exports rank a pitiful 14th in the world. This main source of growth, which is mostly based in our major cities and metropolises, may now be in danger. Our long-ignored traffic and pollution problems may scare off potential customers and investment. Coincidentally, our merchandise exports are also facing a new non-tariff obstacle. In order to prevent the entry of more polluting foreign goods from weakening its green transition, the European Union has implemented the first system in the world to apply CO2 emissions levies on imports (steel, cement, etc.).
Source: Earth.Org
The UK will probably do the same. According to market rumours, this could come up in our FTA negotiations. After the US and China, we are the third-largest emitters of greenhouse gases (GHGS) worldwide. The world reminds us that we are among the highest polluters in terms of emission per dollar of GDP, despite the fact that our negotiators point out that India’s per capita emission of 1.8 tons is far below the global average of 4.2 tons. The average worldwide emission per dollar of GDP is 0.45 kg; India’s emissions are roughly 1 kilogram per dollar of GDP, while those in the US, UK, and EU are less than 0.30 kg. This new danger to our export competitiveness has the potential to undermine our economic prosperity.
Managing many different players is necessary to find solutions to urban development problems. In addition to the many Census towns, we have nearly 4,000 Statutory cities and towns. Based on the 2011 Census, around 400 of our communities have more than 100,000 residents, and 40 citiesu2014including our six metro areasu2014have more than one million. In order to relieve congestion in the larger cities, we must take advantage of this and increase the number of people living in metropolitan areas by improving the quality and appeal of our numerous smaller towns and cities. In order to improve municipal facilities in lower-tier cities, a more equitable distribution of financial resources and management capacity is required. It is necessary to have a more active, decentralised state presence that employs a combination of incentives and disincentives to ensure that policy objectives are met without unreasonably stretching our budget.
The greatest way to achieve voluntary decongestion is with a tiered tax levy. To give an example, owners of more than one vehicle may be required to pay more in taxes per vehicle than owners of only one. Furthermore, unlike people, businesses already receive tax set-offs and depreciation allowances for gasoline used in their cars. This privilege can be removed for company-owned or operated personal transportation cars in our crowded cities. Additionally, to encourage corporate offices to relocate to lower-tier cities, corporations with their headquarters in metros or tier-1 cities would be forced to pay a higher congestion tax than those without. It would be possible to repeat the Jamshedpur experience, in which big corporations were given managerial responsibilities and then relocated to lower-class cities.
Source: Mint
Regarding industrial emissions, a number of expertsu2014including government reportsu2014have clearly identified the main reasons for our subpar performance. We have a lot more MSME industrial units than medium/large scale industrial units (around 250,000), not all of them are required to be located inside registered industrial estates. Essentially, it stems from a confluence of factors including antiquated technology, inadequate environmental monitoring, and subpar/antiquated infrastructure seen in our vast array of very small-scale, and frequently poorly managed, industrial parks. In most places, reliable and adequate power supply is still a pipe dream, necessitating significant expenditures in captive power generation for businesses of all sizes.
Additionally, waste and effluent management systems are still frequently the responsibility of the individual and are only sporadically observed by government officials. Once more, the best way to address this set of issues is to combine taxing carbon emissions with offering subsidies for businesses to upgrade their technological capabilities and upgrade our industrial areas. The industries and businesses that are currently leading exporters should be the first to be considered. It might be more efficient to strengthen and bolster current success stories before expanding the circles. In conclusion, a well-thought-out tax and subsidy policy might assist address our weaknesses in urban planning, industry, and the budget all at once.
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