Local Control or Plunder

An interview with Anil Agarwal

 Anil Agarwal is director of the Center for Science and Environment, a non-profit research institution in India that conducts public interest research on environment and poverty issues.

Multinational Monitor: What are your criticisms of the work that industrialized country environmental groups have done on global warming?

 Anil Agarwal: I would not say that we have been critical of most of the NGOs and environmental groups in the North.

But we have definitely been critical of a few groups. We believe that the way to look at global environmental problems is in terms of looking at the environment as a global common property which we all share, and which is literally the source of our survival. Therefore, the manner in which we manage the earth and its common resources should be such that it brings equal benefits to all humankind. And we felt that this was not the approach that was being taken. Instead, the approach was to attempt to ameliorate a problem, greenhouse gas emissions, without considering who has created the problem.

 This is a very status quo approach in which the rich and the powerful keep creating problems, and then the rest of the world, once those problems are created, must get together and try to solve them. It is not a systemic approach. The atmosphere is a global common property resource, and the benefits of that belong to all humanity. If one group is overusing the atmosphere, then it is not only just damaging the atmosphere, but, in social and in economic terms, it is using up a resource that belongs to somebody else.

MM: Which of the Northern groups have you had disagreements with, and what, were the specific disputes about?

 Agarwal: In 1990, the World Resources Institute published its World Resources report in which it claimed that, apart from the United States and the European community, three developing countries - India, China and Brazil - were also major sources of the global warming problem, and that they were producing a very large proportion of the greenhouse gasses. We pointed out that it is not the amount of greenhouse gasses that one produces, but the amount of greenhouse gasses which accumulate which creates the environmental problem.

 Concretely, they said that the total amount of greenhouse gasses produced every year is equivalent to 8 billion tons of carbon, of which 5 billion tons were getting absorbed, but 3 billion tons were accumulating in the atmosphere every year.

The question was not how much each nation produces, but how much of what each nation produces contributes to the 3 billion tons accumulating in the atmosphere every year, because that is what is leading to the global warming problem. As long as whatever you produce is part of the 5 billion which is getting absorbed by the various sinks that exist, then you are within the limit of what the earth's environment can sustain.

So, the key issue really was: how are we going to share the 5 billion tons of carbon that the earth's environment can absorb. Ideally speaking, each nation should have its own quota of what it can emit, within the global limit of 5 billion tons.

But there was no evidence in the World Resources Institute report that they had tried to think in terms of any equitable sharing of the sink. On the contrary, when we looked into the mathematics, they had divided the sink, but they did it in such a way that the larger the amount of carbon dioxide a nation produced, the larger a share of the sink it would receive.

We felt this was totally wrong; if you are a bigger polluter, then you should be more penalized, not benefited. We recalculated the contributions of different nations to the problem of global warming by giving each human being an equal share in the global sinks. And we found that a lot of nations in Africa, South America and Asia were not contributing anything to what was accumulating in the earth's atmosphere. We found, of course, a large number of industrialized nations which were the main cause of the accumulation that was taking place. In other words, they were using much more than their rightful share of the atmosphere's benefits.

MM: You have also been critical of one of the international agreements that is viewed as a prototype for dealing with global environmental problems, the Montreal Protocol. What's the essence of your criticisms on this issue?

 Agarwal: We have the same sorts of concerns here. The sharing and allocation of common environmental resources should be built on principles of entitlement and liability, which are the basic principles on which most societies function.

As I said, the environment is something that belongs to all of us, and it has been degraded. Therefore, several questions arise. In the case of the atmosphere and global warming, nobody can argue that we should not produce any carbon dioxide. Production of carbon dioxide is essential for our survival. The question is how much to produce.

 In the case of the ozone layer, the issue is slightly different. The issue was that we should phase out the production of chlorofluorocarbons completely, and there should be no production of CFCs at all. In that case, the right approach was to recognize that the ozone layer belongs to everybody and provides benefits to all humankind. Then the question should have been asked: who is responsible for the destruction of the ozone layer; and the people who are responsible for it should be held liable. And it's obvious that the ones who should have been forced to pay the price are producers of the chlorofluorocarbons, the producers of appliances that use chlorofluorocarbons and the consumers of these products, whether they are in the industrialized countries or whether they are in the developing countries, particularly the richer sections of the developing countries which use appliances with chlorofluorocarbons.

That is not the approach which was taken, however. None of the companies which are producing chlorofluorocarbons were penalized in any sense of the word; nor were the consumers, except of course to the extent that we will have to pay for slightly more expensive products when we make the switchover. Essentially, it is the state which is going to be responsible for the switchover to non-CFC-reliant technologies, and the cross will be borne by state treasuries.

Developing countries will be given aid by industrialized countries to make these switchovers. But I thought the liability approach was far more important than this kind of aid-and-charity approach.

MM: The effort to develop a U.N. code of conduct for trans- nationals seems to have pretty much died now, but if you were to formulate such a code on your own, what would be the key elements of it?

 Agarwal: For a person who is keenly interested in issues of the environment, one of the central issues would be that the use of the earth's resources by these companies would have to be very strongly regulated. But I'm not really convinced that state regulation of multinational corporations works very well.

We will have to look at different systems. We will need national legislation which provides communities dependent on their resources with a much greater say in whether any foreign company can come in and use those resources. In the long term, this will be a process in which there will be far greater control over multinational companies and local and foreign companies' exploitation of resources.

I'm not sure whether an international code per se will be able to control multinational corporations very much however. I see the future of developing countries as not being very bright because they are going to be heavily dependent on multinationals. As populations grow in developing countries and as the aspirations of the populations grow, there will be a tremendous need for greater foreign investment, and, with aid channels not increasing, these countries are going to be more and more dependent on investments from big multinational corporations. The World Bank structural adjustment programs are also pushing very much in that direction. In that kind of scenario, governments are going to be much more interested in balancing their books, just like any company. Foreign transactions and foreign exchange reserves and so on will be the top priority of many of the finance ministers of developing countries.

When you are so strongly focused on macroeconomics of a nation, you inevitably tend to forget the microeconomics of your country, which is what most small communities and small groups of people are dependent on. At that point, the national bureaucracies very quickly form a nexus with the powerful interests and powerful institutions like foreign companies.

It is absolutely critical, then, that some of the power to decide who is going to use what resources devolves down to the very people who depend on those resources. I'm sure they will display much more wisdom in deciding how their resources should be used, because if they were to decide wrongly, they are the ones who would suffer.

MM: What kinds of instruments would you like to see placed in the hands of local communities?

 Agarwal: Mahatma Gandhi used to talk about a concept called the "Village Republic." He used to say that India is a country of 560,000 village republics.

Each village, or each community - this idea is applicable to towns and cities as much as villages - has control over its environment, which means that no investment can be made and no structures can be set up within it's environment without its authorization. This environment should be legally defined and its boundaries clearly delineated. Each community knows that it has the right to decide what goes on there and no outsider, whether it is the government, a foreign commercial enterprise or a local commercial enterprise, can do anything without the community's permission. In other words, they cannot use its water, its forests or its grasslands until the local community feels that the transaction is to its overall benefit. That's the kind of instrument that I would like to see, which is essentially the community's right to decide the use of its environment.

 The Indian Supreme Court has reinterpreted one of the basic fundamental rights guaranteed in the Indian constitution, "The Right to Life," as including the right to an environment. The court has therefore allowed individuals to file petitions against any kind of development project which they feel is going to be harmful to the environment. But effectively, what that right does is give us the right to challenge the misuse of an environment.

But it does not give us the right to determine how that environment is going to be used. That's far more important when we talk about the right to an environment. It is far more important that we have the right to determine the use of that environment, not just the right to appeal and to petition against the misuse of the environment.

MM: Turning to India, the country is now opening up its economy very much to foreign investment. What forces have been behind that shift in policy?

 Agarwal: There are a number of reasons. One is the fact that the middle class has been augustly consuming far more than it produces, particularly in terms of foreign products. As a result, there is a foreign exchange crisis. When India asked for money from the IMF , it was told, like all other countries, that it has to restructure its economy in such a way that it can bring in more foreign exchange, which means liberalizing the economy so that you can get more foreign investment. So one aspect of the problem is the foreign exchange crisis, essentially engendered through very heavy middle class consumption. The only way in which it can be controlled is through import taxation, so that you consume only as much as you can afford and your own economy can produce, and not anything more than that.

 This consumption and the new investment policy is also related to the fact that there is a growing desire among educated people to adopt more and more Western lifestyles. They see these Western goods more and more on television. They read about them. They can travel much more than ever before. There is a tremendous desire to live more like the people in the West do. It is not easy for the government or for political parties to challenge this process.

 It's really a crisis that has been growing over time. It was the Gulf War that suddenly brought it to light, because the Gulf War sent the oil prices shooting up and it also brought home a lot of the people who were working in the Gulf area, in Iraq, Kuwait and elsewhere, and who had sent in an enormous amount of foreign currency which used to shore up our foreign exchange reserves. That really squeezed the reserves we had.

MM: What is the effect on society of opening the economy?

 Agarwal: Essentially, what you are doing with the liberalization process is liberalizing the entrepreneur, whether foreign or Indian, and saying that the entrepreneur can now mobilize financial resources, labor resources and knowledge and set up enterprises, and that the government will have far less control over this.

 No entrepreneur can set up an enterprise unless the entrepreneur has access to natural resources, whether it is minerals or the right to be able to emit some amount of pollutants into the air. The entrepreneur needs access to all kinds of natural resources as inputs and as sinks for the waste that the entrepreneur produces.

 Now the question is: who is going to control and decide on the use of those resources? If this liberalization was accompanied by a liberalization which allowed communities greater right to decide that, then I think the check and balance of the system would be much better and it would be a healthier process. But what is likely to happen is that the entrepreneur will be liberalized, but the environmental bureaucracy will control the use of natural resources.

 The bureaucracy has always colluded, whether in India or in anywhere else. The Indian bureaucracy is probably as bad as any in the world in this sense. It will collude with the entrepreneur. It is in the interest of the members of the bureaucracy and the politicians to collude with the entrepreneur. If a simultaneous liberalization does not take place where the people are empowered, and if you're only going to have the empowerment of just the entrepreneur, then you're going to have a real disaster.

MM: What has been the popular reaction to the economic liberalization?

 Agarwal: There was a lot of criticism on the liberalization process.

But it is very important to understand that many supported the liberalization process because of the fact that Indian society had become heavily bureaucratized. The state was a very dominant sector of the economy, and there was a tremendous amount of controls on all kinds of things. The idea of de- bureaucratization was definitely welcomed by a lot of people.

 If you talk to a lot of activists and local leaders, for example, they consistently talk about how bad the bureaucracy is: the agricultural bureaucracy, the revenue bureaucracy, the forest bureaucracy, the water bureaucracy. Environmentalists, for instance, have constant battles with all these bureaucracies. They have to fight against the water bureaucracy and the manner in which it deals with the rural people. The same thing is true of the forest sector. The forest bureaucracy does not respect the rights of local people at all. The forest bureaucracy is as atrocious and dictatorial as any bureaucracy can be.

So there is a tremendous need for de-bureaucratization. To the extent that this foreign exchange crisis forced the government to rethink, and say that bureaucracy is not the answer to many of our problems, it was a good thing. Unfortunately, I'm not sure whether it has led to any real thinking in terms of how to cut down the bureaucracy. It is more likely that the bureaucracy that controls the interests of the big, powerful corporations and the business interests is going to be cut, while the bureaucracy that controls the lives of millions of poor people and rural people, and totally stifles their initiatives, will continue. And that would, indeed, be extremely unfortunate.

MM: Has there been any noticeable influx of foreign investors since the liberalization of the economy?

 Agarwal: There was a certain amount of investment definitely growing, particularly in the agro- industrial sector. There are a lot of companies coming in to grow and export prawns (shrimp). There is also a lot of talk about groups like Pizza Hut coming into the country, which many Indians feel is totally unnecessary for their development.

 That has been the initial phase; how this will grow in the future is very difficult to say.

 And again, if you look at the shrimp farm issue, the same resource control questions arise. You need to have access to wetlands for shrimp farming, and this can lead to a considerable amount of environmental degradation. All along the eastern and western coasts of India, there are a lot of traditional fishermen who are heavily dependent on wetland resources. What is going to happen to them is a very central issue. Who is going to decide how these wetlands are going to be used? Who is going to be using them? What terms and conditions will be applied?

 A foreign entrepreneur may come and team up with an Indian entrepreneur, and the two of them, in the new liberal atmosphere, will have easier access to these wetland resources. But the local communities will have no say in the whole matter. This is where, I'm afraid, that things can very easily go wrong and end up by being far more destructive. They may boost the macro-economy of the nation in terms of its foreign exchange reserves and things like that, but may be highly destructive to the survival of the local people and their economy.

MM: Could you elaborate on your concerns about the infusion of Western values into India?

 Agarwal: This is indeed a very serious problem. In terms of purchasing power, economists say that the Indian middle class is on the order of some 200 million people. That makes it a very large number of people. If these people are going to create demands of the kind that exist in the West, then it will create an enormous political demand to allow production within the country of those kinds of products, or at least to allow the import of products from the West. If the government tries to control the import of those products, and not allow their production within India, then what you get is an enormous amount of smuggling, which is what happened during the 1960s and 1970s along the western coast of India. All this slowly began to have a tremendous impact on the politics of that area, with a nexus developing between smugglers and high government officials.

 MM: Are there any mechanisms available to counteract these trends?

 These are very serious questions indeed. How does one make sure that the richer segments of society conform to what the society can afford. It's really a question of, if I can use the term, a cultural revolution. It has to come from the political system, but the political system itself over time has become extremely corrupt. It's not an easy task at all. In fact, it is getting harder. Consider the expansion of television in India, with the growth of advertising and the kind of messages that are getting in. And now with satellite television coming in, it means that people can watch even foreign television. Even in rural areas, we are beginning to see a very strong demand emerging for all kinds of products from outside. It's not going to be an easy task to try and reverse this process.

 How one does it in any society, I'm not sure. One can try to do it through all kinds of restraints. But the problem with restraints is that they are usually imposed through the instruments of bureaucracies. The bureaucracies themselves are never very disciplined and the result is that you immediately get contradictions emerging within the society, with the bureaucracies becoming rich and forming alliances with a small section of people who are then able to maximize their own personal benefits.

 The other way would be through some kind of democratic process. But even then, it's not very clear how one can stem the onslaught of materialism, how one can maintain a certain value system where people keep control over their consumption. My own feeling, and I must say it's just a feeling, is that if there was far greater strengthening of communities and their management of resources, people would begin to recognize that their resources are limited, that they have to depend on what resources they have, and that they therefore will learn to be a lot more careful about how they use things. That will automatically force people to rethink their consumption habits.

Take the example of water. Most Indian cities are using enormous quantities of water and then they produce enormous quantities of waste water. This process goes on, and because the cities are powerful, they draw in enormous amounts of water from all the rivers, and then the used water goes out and pollute these rivers. But the water users do not pay these costs, because rivers are under state ownership. If the state allows the pollution of a river to continue, a lot of poor fishermen who depend on that river for their survival will totally go out of business. They will have no fish left and there's nothing they can do about it; they would have no say in the process. But if the fisherman had some rights over the pollution of the river, I'm sure they would not allow a city like Delhi to pollute the Yamuna to the extent that it has been polluted. The fishermen of the Ganga would not allow the Ganga to be polluted as it now is, because they would have a vested interest in that river. The state does not have that vested interest. The state politician is more interested in earning votes from the urban people than protecting the fishermen.

We provide a subsidy to the rich people of our country by providing them with a sewage system. The sewage technology is something that mainly benefits the rich people all across the developing world. It does not benefit the poor people. The urban poor have no access to sewage toilets and things like that. And then we provide the rich with a further subsidy of cleaning up the waste that they produce. I don't see any reason why the rich have to be subsidized simply because they want to go to their toilet. Either we should force the manufacturers of toilet systems to produce toilets that do not use any water or use very small quantities of water, or, if anyone wants to use toilet systems which use a lot of water, then they should be forced to pay a very heavy price. But nobody is interested politically in forcing them to pay that price because there are no checks and balances within the system.

The result is that the state will go ahead and build all the dams in the Himalayas and elsewhere; bring water to all the cities, which then flush as much as 20 to 30 percent of this water down their sewer systems; and then put in further investments in sewage systems and later in treatment facilities. From a political economy point of view, it's absolutely crazy. You're subsidizing the richest sections of your community, and not forcing them to pay anything.

 If the rivers in the Himalayas were owned by the Himalayan communities, and if the rivers in the plains were owned by the local fishermen, and communities owned the aqua systems and so on, any time there was a degradation of these resources, somebody would suffer along the line and say, "Look, this is not right." If somebody else was doing it, then they would have a fight about it in court or in the political arena. If they were doing it to themselves, then they would fight among themselves, and they would say, "This is no way to handle it. Many of us are suffering in this whole process." I think a much better system would emerge and people would realize the value of their consumption. Today, I don't think a single Indian in the middle class sections of Delhi or Bombay, any educated Indian particularly, understands anything about the value of the water that they use. It's just not part of our consciousness.

I may be totally wrong on this. But unless we move much more towards community ownership of resources, I don't think, there will be much improvement in our consciousness about how we use resources and how we should control our consumption.