Pursue Growth With A Paradigm Shift In Economic Thinking; Not By Destroying Natural Resources

Preserving ecosystem services of biological resources should then become a priority. An example needs to be drawn from Scotland, which has officially become the world’s first ‘rewilding’ nation by restoring habitats

Robert Reich, a former Labour Secretary in the Bill Clinton Administration, in an X post the other day mentioned “The 15 largest corporate beneficiaries of Trump’s tax cuts saved $97.5 billion in taxes from 2018 and 2021. Instead of reinvesting their savings in their workers, these same companies have spent $83.9 billion on stock buybacks and shareholder dividends.”

This tweet comes at a time when the State of Forest Report (IFSR-2023) released last week by the Forest Survey of India recorded an enhanced green cover in the country, increasing the area under forests by 1,455 sq km between 2021 and 2023. But no sooner was the report released with catchy headlines applauding the effort, a tweet by environment journalist Bahar Dutt made me sit back, and rethink. She mentioned to an excellent analysis by ecologist Madhusudan MD, who had earlier explained how tea gardens, coconut plantations and desert scrubs have been counted as forests to show a flattering growth.

Now, before you ask me as to what is the connection between the two, I mean between the tax cuts that led to massive buy back of stocks in the US and the dwindling forest cover in India, let’s first try to understand more.

As I explored further, and looked into various other sharp analysis in the media, it was intriguing to observe how in two decades (between 2003 and 2023) and estimated 24,000 sq km of forests was lost (as an analysis pointed out), and yet we seem to be rejoicing.

In Chhattisgarh alone, the area under forests has come down by 19.13 per cent in the past two years. The merciless cutting down of trees in the forests of Hasdeo by companies engaged in mining, and the government support to ensure that the tribals are kept away by easily violating the human right norms, is certainly painful. The axing of nearly 10 lakh trees for the mega-infra project in Great Nicobar is another environmental disaster that has received scant attention. And so on...

While I am not going into the merit of the arguments flagged, and considering this column is not examining how severe the loss in forest cover is, I leave it the reader to dig out more and draw their own conclusions.

Nevertheless, what caught my eye was a Linkedin post that has been posted afresh. It talks of how a Swedish millionaire Johan Eliasch had spent $14 million in 2005 to buy 400,000 acres of Amazon rainforest and that too from a logging company. He purchased the forests to save it from the axe.

As was rightly mentioned, Johan’s philanthropic initiative was driven by the intent to protect and preserve forests. He utilised his economic gains to not only save the natural forests but also in the process safeguard vital ecosystems.

At a time when cutting down a tree is known to add to the country’s GDP, the more the trees being felled the higher the economic growth, Johan realised that all his outcry and advocacy efforts to stop logging of the forests will not be of much help. He therefore found it prudent to invest in buyback of a part of the Amazon rainforests that was in any case ready to be destroyed. He can now look back to the great humanitarian task he has achieved by putting his money where it matters most.

Researching further, and wanting to know more of such initiatives in India, if any, I came across a 2020 Mongabay news report that talked of how a former civil servant and an avid photographer Aditya Singh purchased 35 acres of land in 1998 in Bahadlav, adjacent to the famed Ranthambore Tiger Reserve. He bought the land over a period of time but has allowed growing it as a natural forest.

“I just bought this and did nothing to it except removing the invasive species. We allowed the land to recover and now after 20 years it has become a lush green patch of forest which is frequently visited by all kinds of animals, including tigers, leopards and wild boars, throughout the year,” Singh was quoted in the news report. The green patch of jungle he created appears more or less like an oasis in the degraded landscape around.

Aditya Singh has also invested in reality in a buyback arrangement, but not in stock buyback but on a patch of degraded land that he has helped develop as a green forest over the years.

This makes me wonder. If as per a report of the Swiss Bank UBS, the wealth of billionaires in India has risen by 42 per cent to reach a staggering combined wealth of $905 billion in the last financial year alone, there is no dearth of Richie Rich nearer home.

Moreover, with change in taxation laws aimed at boosting shareholder value, Indian stock market is seeing a notable increase in stock buy backs. A 2023 report shows that 49 companies have demonstrated a collective buyback of shares to the tune of Rs. 58,620 crore. Instead of looking at the fiscal gain accruing from stock buybacks, the policy effort should be to encourage a sizeable amount out of this shifting to forests buy back. After all, we need to save the only planet we have.

If only a handful of them begun to see buy back of forests as their humble contribution to save the planet, the world will begin to create a new class of philanthropists. Such a national (and for that matter a global trend) can only happen when the focus of growth should shift to economics in tune with nature preservation.

Growth cannot be allowed to build on further destruction of natural resources. This will require a paradigm shift in economic thinking.

Preserving ecosystem services of biological resources should then become a priority. An example needs to be drawn from Scotland, which has officially become the world’s first ‘rewilding’ nation by restoring habitats and hoping to recover its nature over 30 per cent of land and oceans in the years to come. A similar movement to recover and restore nature in the biological wealth hotspots in India to begin with is absolutely essential.

Such a movement can only begin when instead of treating GDP as a report card, the governing elite begins to see growth in tandem with preserving and restoring the nature. The matrix of growth can be redesigned.

(The author is a noted food policy analyst and an expert on issues related to the agriculture sector. He writes on food, agriculture and hunger)