Price of forests : proceedings of a seminar on the economics of the sustainable use of forest resources / edited by Anil Agarwal

To deal with the various aspects of forest use and management, the seminar was divided into five sessions. The first session dealt with natural resource accounting with special reference to forests. All over the world people are trying to take forests and their tangible and in tangible uses into account while evaluating projects that could have a negative impact on forests. The second ses sion dealt with certain basic issues of forest manage ment. The third session focussed on our state of knowl edge about forest products. The fourth session brought together numerous interventions on the economics of af forestation and forest regeneration. The fifth session tried to raise the issue of ecological diversity and, there for, the need to analyse separately the economic role of forests in different agroecological regions. included in these proceedings represent. The papers the state of art in the country. They show that there is already considerable interest in natural resource eco nomics but that there is still an enormous amount of work that needs to be undertaken. The seminar resulted in a number of findings that government and academic agencies and individual researchers could try to deal with in the future.

1. There is an urgent need to develop good cost benefit analysis techniques which include imputed val ues for environmental services provided by natural re sources like forests, something that is not done at the moment. The work that has already been done in India in developing such values is to say the least "fantastic", as one Swedish economist present at the seminar pointed out. Apparently a few years ago a life scientist from Calcutta wrote a paper in a forest rangers' college maga zine called The Value of a Tree in which he calculated the value of the environmental services provided by a 50 year tree over its lifetime to be Rs. 15.7 lakh. This figure has been unquestioningly accepted by government agen cies and taking into account the tree densities of different types of forests, the value of environmental services provided by an hectare of different types of forests has been calculated. But few economists are likely to accept a figure like this. The value of Rs. 15.7 lakh per tree has been calculated by estimating, among other things, the oxygen produced by a tree over 50 years and the money that will be needed to purchase that quantity of oxygen from an industrial firm. While all this may be acceptable as a back of the envelope calculation undertaken to stimulate a debate, serious economists will definitely object to this misuse of the replacement value technique. The sum of Rs. 15.7 lakh, moreover, is so high that the income of an average person in India will not even be a quarter of this amount over a period of 50 years. 2. Once the art of environmental cost-benefit analy sis has been perfected, then, as Kirit Parikh pointed out, there is a need to merge the two separate exercises that today take place in government the Environmental Impact Assessment of projects by the Ministry of Envi ronment and Forests and the financial cost-benefit analy sis by the Planning Commission.

3. Most experts present at the seminar also felt the need for the development of a national natural resource accounting system so that any degradation or depletion of our natural resource stocks can get adequately re flected in our national accounts. Only then will we get a more accurate picture of our economic growth-whether it is not being obtained today at the cost of discounting our future. Kirit Parikh rightly pointed out that a na tional programme ought to be launched to develop the tools and techniques needed for such an accounting system. There is a lot in this area that will have to be developed by Indian economists and environmentalists themselves. They cannot rely only on the work being done abroad. For instance, no Western resource econo mist is going to account for distributional effects with any seriousness or study the social and environmental value of the village commons.

4. Madhav Gadgil's paper points out to the need for a harmonisation of the environmental policies in the country. In order to protect India's forests, the govern ment has liberalised the imports of pulp and timber. Indian industrialists now find it cheaper to import pulp from abroad than buy pulpwood from Indian farmers. As a result, the farm forestry programmes promoted during the 1980s have sharply declined. As yet, the government does not have a clear policy about how the country is going to meet its burgeoning demand for industrial timber. The recent devaluation is once again sending Indian industrialists looking for Indian trees as against Canadian trees.

5. In this context, R.V.Singh's revelation during the seminar that we know precious little about the demand for timber in the country should no longer be ignored. Tirath Gupta and Vinod Ahuja also pointed out to sev eral lacunae in the past studies undertaken to assess the firewood demand. Regardless of how good and pioneer ing these studies might have been when they were un dertaken, it is important that we get more accurate estimates of the wood needs of the country now.

6. Equally, we know precious little about the sources of our current wood supply. For long foresters and economists had argued by looking at the enormous gap between the firewood demand and firewood supply from state forests that there must be large scale pilfering by the people from forests to meet their wood needs. However, an interesting study presented during the seminar revealed that homestead trees meet as much as 80 per cent of the total wood supply in the state of Kerala. Only five per cent of the wood supply comes from forests.

7. Several studies presented during the seminar ar gued that afforestation and soil conservation lead to sub stantial financial benefits. The study by Ayub Qutub from Pakistan revealed some impressive cost-benefit fig ures from a catchment treatment project. But everyone agreed that people's participation is crucial for good natural resource management at the village level. The study conducted by Kanchan Chopra and Gopal Kadekodi revealed clearly that substantial benefits accrue when villagers cooperate to manage their natural resources. There are very few studies on participatory natural resource management by economists. Not only is there a great need for more such studies but this kind of research. can also lead to healthy cooperation between environ mentalists working in the field and professional econo mists. The study conducted by Chopra and Kadekodi is in fact, the result of a long-standing collaboration be tween the economists' team and Priya Ratna Mishra, one of India's outstanding practitioners of participatory natural resource management.

8. Studies presented by Manjul Bajaj and A.K.Mukherjee rightly pointed out that natural regen eration leads to a much better mix of species from a social need point of view and as a greening strategy is much cheaper than afforestation. In fact, in several participa tory projects in the country, as in Sukhomajri near Chan digarh or in Seed in Udaipur district, villagers have adopted natural regeneration as their strategy. Ulti mately, of course, both afforestation and natural regen eration will be needed so that villagers can get all the tree species they need. Not all species will be available through natural regeneration. The government should develop a clear strategy to involve village communities in the re generation of their lands.

9. Different strategies have been adopted by differ ent projects and programmes to involve the villagers in resource management. It is important to study which of these models Arabari, Sukhomajri, Seed, Bhusadia or any other is better in which set of conditions. The Arabari model is being pushed by several foreign organ isations and UN agencies based in New Delhi but there is no reason to believe that this model is the best. This model may be the most acceptable to government agen cies because it relinquishes little control over forests in favour of village communities, treating them largely as user groups. But surely government convenience cannot be considered the sole criterion for developing new insti tutional frameworks for ecological enhancement on which

so many millions of livelihoods depend. 10. Several papers presented during the seminar re vealed the irrationality of the government's efforts to bring shifting cultivation to an end. The studies pre sented revealed that shifting cultivation makes economic sense for the tribals who practise it. Scientific research is more needed to stabilise the productivity of this agro forestry system at lower return cycles.

11. There is an urgent need to understand the uses of trees and forests in different ecosystems of India. Papers presented during the seminar revealed the diversity of uses that people make of trees and forests and the diversity of crop-forest interactions in the country. N.S.Jodha's attempts to study the specificities of moun tain ecosystems need to be duplicated if we are to de velop ecologically sound land use and economic devel opment programmes.

These are just some of the key issues that were raised during the seminar. The full breadth of the discussions can be gauged only by reading through the full proceed ings. We do hope it will make an interesting addition to the growing literature on environment in India and policy makers and students of economics and environ ment will be able to make good use of it.