Value of woods

A meet on evaluating the value of forests

By Kirtiman Awasthi
Published: Saturday 15 April 2006

on march 20, 2005, the Institute of Economic Growth (ieg) organised a seminar to gain an insight of issues pertaining to calculation of Net Present Value (npv) of forests. The matter has been debated ever since the Supreme Court (sc) called for a system on September 26, 2005, to evaluate the environmental cost of diverting forestland for non-forest use. The apex court had also directed that npv should be levied from projects that divert fore land for non-forest purposes.

L ast year, sc had appointed a three-member expert committee, headed by Kanchan Chopra forest economist from the ieg and one of the organisers of the conference -- and gave four months time to come up with npv rates. "The new rates will depend on the type of forestland, location and density of the forest, said Chopra.

It also includes services and goods accruing to all the stakeholders, she said. Taking Himachal Pradesh forest for its case study, the Chopra committee has come with an npv rate in the range of Rs 4.14 to 7.69 lakhs for various forest circles in Himachal Pradesh.

The methodology that Chopra committee followed recommended that calculating charges based on biophysical, legal, ecological and social parameters, while npv was based on the values of timber, carbon storage, fuel wood, fodder, non-timber forest products, eco-tourism and watershed services. But the committee excluded protected areas from its calculation.

"But how meaningful would an economic valuation of forests be?" questions P S Ramakrishnan, environment scientist at Jawaharlal Nehru University, New Delhi. Ramakrishnan thus urged the committee to consider socio-ecological ecosystem in its entirety and said, while calculating npv rates for the people who are dependent on forests. Sanjay Upadhyay, legal expert at the Enviro Legal Defence Firm advocated involving panchayats in evaluating the juridical basis of npv. H e pointed out at one ambiguity overlooked by the Chopra committee: there are no clear definitions of forest and forestland. The methodology proposed by the committee is based on only forest cover and does not include forestland.

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