Green Accounting for Indian States Project (GAISP)
"GDP Growth" does not capture many vital aspects of national wealth and well-being, such as changes in the quality of health, the extent of education, or the quality and quantity of natural resources. Thus GDP accounts are inadequate to evaluate the trade-offs encountered by India's policy makers, and in the absence of an appropriate 'sustainability' yardstick, the concept of 'sustainable development' in India remains at best an elusive dream. Visible symptoms of unsustainable development include large & persistent disparities in wealth levels between rural and urban communities, inadequate public investment in health & education, rapid natural resource depletion, and a widespread incidence of the "vicious cycle" of chronic poverty and environmental degradation in forest-dependent communities.
Therefore, recognizing that GDP growth is too narrow and inappropriate as a measure of economic growth and national wealth, the Green Accounting for Indian States and Union Territories Project (GAISP) was launched in July 2004, by the Trust. The set of six monographs helps to build a framework of adjusted national and state accounts representing genuine net additions due to conventionally seen as "invisible" benefits from nature to national wealth. GAISP sets up top-down economic models for state-wise annual estimates of adjusted Gross State Domestic Product (GSDP) for India, capturing and analysing true 'value addition' at both state and national levels.
The first phase of GAISP consists of the six monographs, each of which evaluates a particular area or related set of areas of adjustments to GSDP accounts. The second phase (expected to begin 2015 onwards) will update the data to more recent years and publish an additional two monographs.
The monographs adjust for externalities such as the public, non-market services of forests (carbon storage, biodiversity values, ecological services and so on), the hidden costs of agriculture, losses in freshwater quality and depletion of India's biodiversity. The positive externalities of education are also evaluated and adjusted. The monographs source data only from official Indian national databases (with granularity at State level), and follow consistent methodology and in line with the United Nations' SEEA - 2003 guidelines.
The monographs help to provide a toolkit for India's policy-makers to evaluate in economic terms the trade-offs faced by the nation. They also enable policy-makers and the public to engage in debates on the sustainability of economic growth, both at the national level as well as through inter-state comparisons.
The 'Central Empowered Committee' in its report (IA NO. 826 In IA NO. 566) , regarding calculation of net present value (NPV) payable on use of forest land of different types for non-forest purposes, calculated the average Net Present Value per hectare of forest of India. This calculation was based on the methods and values provided by the various GIST monographs. The CEC also agreed to use 4% discount rate for the calculation of NPV of per hectare value of India's forest, based on the GIST monographs.
The Trust plans to provide an updated version of its Monographs to ensure that the most recent data is taken into account, to enable policymakers to use the findings for guiding legislative and policy changes. Download a brief of the proposed project here.