North rejects India's plea

India's request for a $2 billion grant to cut down the use of ozone-depleting substances was turned down because Northern countries felt it was trying to take the maximum amount without a detailed plan of action.

By Ravi Sharma
Published: Wednesday 15 December 1993

-- (Credit: Rustam Vania)THE EXECUTIVE committee of the Ozone Fund -- an international fund instituted to replace ozone-depleting substances (ODS) -- has rejected India's request for a $2 billion grant to replace these substances by 2010. Northern donor countries felt India's plan lacked detailed information and also projected a ten-fold increase in ODS consumption till 1997. However, developing country members of the committee saved the day for India by asking it to present a revised plan.

"We cannot accept several assumptions made in the plan, especially the way incremental costs have been calculated," remarked W Kakebeeke, a director in the Dutch environment ministry, at a committee meeting in Bangkok held in the second week of November. Commented Victor Buxton of the Canadian environment ministry, "The requirement of $2 billion over 17 years is probably the biggest disbursement we will make and needs to be carefully scrutinised." The US was more specific and said it will not accept projects such as return of refrigerators.
Revised plan The revised plan India has been asked to present must aim at an accelerated phase-out of ODS and time-bound projects should reflect this. India was also asked to conduct a detailed survey of the small and informal sector, which accounts for two-thirds of the production of these substances.

Though India's programme was discussed at the meeting, several other countries' plans were approved without discussion. Donor countries felt India was trying to make use of the maximum amount available within the protocol. According to a delegate, the North's concern was that India had broadened its interpretation of what could be funded and this could set a precedent.

According to a senior UN official, Northern countries are keen to reduce the funding to $1 billion -- the amount proposed by the UN Development Programme. This may prove a burden for India, as it will have to finance the rest of the project.

Omar E El-Arini, head of the Fund's secretariat, criticised India for "dual charging" the fund. He said India is asking for money to phase-out the production of one type of ODS while increasing the production of another, thus raising the net amount receivable from the Fund as "incremental costs".

India was also discouraged from asking for money to develop its research capabilities. One of its research projects was deferred for further evaluation and for two others involving the transfer of technology from the West, India was granted only 25 per cent of the projected cost.

"The developed nations are cheating the South," said the representative of the Centre for Science and Environment (CSE). The major companies producing ODS are also the ones developing alternatives. As the Fund subtly ensures that its money is used only to buy technologies -- and not develop new ones -- developed countries manage to monopolise the market, the representative added.
Donor power Vinay Shankar, additional secretary in India's ministry of environment and forests, said he was concerned about donor countries using their power to limit agreements made to replace ODS. This was even though India's per capita consumption of these substances is only about 1.12 per cent of that of USA and Europe.

The CSE representative said the worst fears of developing countries have come true because they accepted the flawed protocol within the aid/charity framework. "Now poorer countries are being forced to take on the financial and administrative burden of the technological shift required because of the past mistakes of the developed nations," he added.

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