Sansad TV: Green Budget | Current Affairs & Hindu Analysis: Daily, Weekly & Monthly - UPSC PDF Download

Introduction

• During the presentation of the Union Budget, Finance Minister Nirmala Sitharaman announced several initiatives aimed at reducing the carbon intensity of the Indian economy, meeting clean energy targets, and creating large-scale green job opportunities.
• These initiatives include policies related to green fuel, farming, mobility, buildings, and equipment, as well as measures for the efficient use of energy across various sectors. The budget also includes an outlay of 19,700 crore rupees for the National Green Hydrogen Mission and 35,000 crores for priority capital investment toward energy transition, net zero objectives, and energy security.

Green Budgeting

• Green budgeting involves using budgetary policy-making tools to achieve environmental and climate goals. This includes evaluating the environmental impacts of budgetary and fiscal policies and assessing their coherence in relation to national and international commitments. It can also contribute to informed, evidence-based debates on sustainable growth.
• To implement green budgeting, countries should build on their existing public financial management framework and consider integrating performance objectives related to national environmental and climate goals. The Union Budget 2023 is in line with India's commitment to lead global action against climate change, preserve biodiversity, and support sustainable development. 
• It includes capital outlay and policy frameworks to accelerate clean transition and sustainable growth, and is aligned with India's net zero goals, COP27 commitments, and updated Nationally Determined Contributions (NDCs).

Strong Strategic Framework:

• It is crucial for the government to clearly outline their environmental and climate-related goals and priorities in national strategies and plans. This will assist in fiscal planning, ensuring that tax and spend decisions align with the achievement of national objectives.

Green budgeting tools

Various tools can be used to evaluate the environmental and climate impact of budget measures. These tools should be built on a country's existing public financial management (PFM) framework and may include:

• Green budget tagging: Classifying budget measures according to their environmental and/or climate impact.
• Environmental impact assessments: Requiring assessments of environmental impacts to accompany new budget measures.
• Pricing ecosystem services, including carbon: Putting a price on environmental externalities, such as greenhouse gas emissions, often through taxes and emissions trading systems, to facilitate the achievement of national environmental and climate goals.
• Incorporating a green perspective into spending reviews: Considering the impact of measures on national environmental and climate goals alongside efficiency considerations.
• Integrating performance objectives related to national environmental and climate goals.

Biodiversity Conservation and Agriculture:

• The Union Budget 2023 aims to promote biodiversity and natural resource conservation through a range of initiatives that align with the Global Biodiversity Framework at the UN Biodiversity Conference.
• These include the MISTI initiative (Mangrove Initiative for Shoreline Habitats & Tangible Incomes), which proposes mangrove plantations along the coastline and salt pan lands, and the Amrit Dharohar scheme, which seeks to enhance wetlands, biodiversity, carbon stock, eco-tourism opportunities, and income generation for local communities over three years. 
• To address agriculture's contribution to greenhouse gas emissions, the budget includes initiatives for green agriculture, such as the PM-PRANAM (PM Programme for Restoration, Awareness, Nourishment, and Amelioration of Mother Earth) that promotes alternative fertilizers and balanced use of chemical fertilizers.

A Modern Budgetary Framework

• The Union Budget 2023 provides a strong enabling environment for green budgeting by linking strategic planning and budgeting, adopting multi-annual budget envelopes, implementing outcome and evidence-based budget processes, and engaging closely with parliaments and civil society.
• To support the implementation of Green Budgeting, strong political leadership, clearly defined roles and responsibilities within government, a well-designed sequence of implementation, fit-for-purpose internal systems, and the development of capacity and expertise among civil servants are required. Additionally, coherence with other budget initiatives, such as gender budgeting, should be ensured.

Conclusion

India is striving to achieve an equitable and sustainable path of development by promoting responsible consumption and sustainable management of resources for the years ahead.