Air Pollution Control in India and Socio-Economic Analysis

This is a research assignment I completed for my natural resource management course. It provides an overview of the effectiveness and potential issues pertaining to India's local Air Act Policy (1981), particularly with the issue of seasonal crop burning. 

 Introduction: 

India is notorious for air pollution, hosting the “Asian Brown Cloud”, with PM in 180 cities 6 times the WHO standards (2). Major causes of air pollutants are biomass burning, industrial and transportation emissions. 

A major contributor in the Northern states for emissions is burning of agricultural and municipal waste, which contributes to 30% of Delhi’s air pollution (1). India is the leading producer of agricultural waste, generating 500 millions tons of waste per year, only to be followed by Bangladesh at 72 millions tons/year, as is expected from India being the second largest agricultural economy globally (7). The Government of India (GOI) issued the National Clean Air Program (NCAP) in January 2019 to tackle the challenge faced by Indians for air pollution till 2024, targeting 20-30% urban pollution reductions (3). However, due to poor enforcement of agricultural waste disposal, stubble burning practices emitting high levels of CO, CO2 and SO2 caused 7 million air pollution related deaths related with peak emissions for November 2019 in India mainly due to stubble burning for agricultural waste management (4). This incident highlights how poor agricultural residue management is a cause for inefficient air pollution control causing public health concerns and threatening urban economic activities.

One of the major policies pertaining to agricultural waste handling in India is National Policy for Management of Crop Residue (NPMCR), which serves the purposes of  promoting technological use in the agricultural industry for crop residue management and monitoring pollution control (8). Despite seeing a decrease in the crop residue by 15-40% in the Northern states of India, the challenges persist as there are conflicts of interest between economic and environmental management (8). The major air pollution policy in India, “Air (Prevention and Control of Pollution) Act (1981)”, is one of the drivers of the NPMCR and is one of the most influential Indian air policy acts, with the purpose to control pollutant emissions considering industrial, transportation, energy and liabilities for infringing parties by assigning board members powers and functions (5). Most of the purposes of this overarching act relate to institutional management, actions and powers to sample and hold parties liable, with major focus on industrial emissions, although there is not much emphasis on adequate waste handling systems despite India being regarded as one of the “worst offenders” of waste disposition through incineration which accounts for an estimated 20% of India’s air pollution sources (1). Based on these GOI’s measures for NCAP and air pollution reduction objectives, evaluation of the socioeconomics of the agricultural pollution control policies of India is required to make better policy amendments and actions.

Economic Perspective Analysis: 

The current political leadership of the Indian government has emphasized on the need for economic development over pollution control (1). It’s estimated that air pollution costs 95 billion USD (3% of India’s GDP) every fiscal year, thus effective solutions must be imposed for managing the economic externalities of air pollution control in India (9). However, most clauses committed under the Air Act and NCAP relate to institutional regulations and institutional dynamics (74%) rather than economic (2%) or physical (24%) incentives and plans, despite them being the major proprietors of regional air pollution control (6). As the cost of agricultural residue management is higher than the revenue earned from recovery programs for energy generation or composting, a negative externality is imposed on the parties that doesn’t involve the producers and users of the waste (7).  Currently, means to tackle air pollution externalities in India are limited in the NCAP agenda as congestion pricing, taxation or cap-and-trade are not considered (6). The current command and control approach of the authorities is cost efficient but lacks enforcement without economic incentives, creating a red-tape scenario with adverse effects on the population. 

The agriculture industry’s lack of purposeful behaviour due to lack of awareness pertaining to waste incineration is due to the short-term benefit mindset of reducing crop waste as quickly as possible in order to maximize economic gains of the next cropping (7). Thus 6% of NCAP’s initiative is focused on public monitoring and awareness of sustainable cropping practices (6). Furthermore, air pollution in India causes scarcity of public health resources, reduced agricultural production, and stagnates economic activities. As the NPMCR focuses on technological developments, choices must be made for optimal waste management principles, and one such initiative being investment in biogas plants (7). Under the NPMCR, economic policies for financial returns are are being considered for farmers (up to INR 5500/USD 77 per tonne of agricultural residue) with the government addressing the negative externality after using the residue for a mix-fuel strategy with the National Thermal Power Corporation (NTPC) (7). This interception of the agricultural and energy industry hedges the negative externalities of agricultural waste utilization on private sectors. The marginal abatement cost for energy generation in India is estimated to be INR 3,380 (USD 46.0) per tonne of CO2 emissions, without distinction between clean and polluting emissions sources (11). However, with better waste management facilities and distinction between clean and polluting sources, this cost can be reduced up to INR 2,400 (USD 32.7), thus providing better efficacy in air pollution control (11). 

However the marginal benefits experienced by air pollution reduction and integration of waste management in energy still remain limited. As the abatement strategies involve decentralization of private and public sectors, the initial investments to manage the costs of negative externalities lack sufficient support as institutionalized barriers presented by the Air Act policy centralizing air pollution control powers on the GOI and board members challenge optimizing the marginal benefits of agricultural and municipal waste (12). 

Evaluation & Projection:

Efficiency 

Despite the lowering of marginal abatement costs if negative externalities are hedged by decentralization, the marginal benefits remain unquantifiable but estimated to be low given the lack of public support. Thus, optimal marginal utility is not being implemented by the NPAC and NPMCR acts as it presents conflict of interest with the Air Act (1981). Thus, marginal utility for air pollution control is blindsighted by the Pareto efficacy of allocating waste for energy generation, either costing public health, public or private sectors. 

The projected revenue by 2025 from the agricultural industry in India is 10.73 billion USD, with 70% of the population relying on this industry for their survival (13). However, with the estimated figure of 20% of air pollution attributed to improper waste management and 95 billion USD in loss from air pollution, an estimated loss of 19 billion USD can be assumed due to agricultural residue incineration. This leaves the total benefits of this policy endeavour in a net cost/loss, thus the actions considered by the NPMCR must be scaled to larger extents, not only considering agricultural workers but also waste produced by individual households. The efficiency potential in waste and biomass incineration equity of India is not being utilized as the policies emphasize on state control and excessive bureaucratic measures, with costs distributed mainly to the decentralized authorities and individuals. 

Sustainability 

Since the implementation of the Air Act and its amendment in 1987, India has seen regional pollution reduction up to 25-40%, with clean energy incentives achieving 41% non-fossil fuel energy sources (1). However, the seasonal waste problem of crop burning remains inefficient from the NMPRC standpoint. 

Sustainable aspects of NMPRC and the NCAP are that they consider fair monetary incentives, educational and technical support for public awareness, and maintaining liabilities. Although these policies encourage circular economic principles of waste repurposing, the economic profits remain low and thus are less accepted than conventional waste disposal methods. Additional methods for solving negative externalities via taxation or cap-and-trade must be considered for long-term reduction of air pollution pertaining to agricultural residue in order to realize sustainable management. The resource and public health sustainability of this policy remains beneficial only to the centralized authorities as they require low investments in addressing the waste and air pollution issue in India, and plans to implement financial returns are uncertain given the high corruption index perceptions (15).

Conclusion: 

Due to layering of bureaucracy of NPMCR in the Indian Air Act, effective waste handling policies, particularly for agricultural residue, present challenges for the NCAP’s agendas. The processes don’t consider maximum economic efficiency and equity of the waste management sector and the sustainability with environmental and economic benefits remains questionable due to institutionalized monopoly of this sector.

References: 

1. Wedocs.unep.org. 2021. Air Quality Policies. [online] Available at: <https://wedocs.unep.org/bitstream/handle/20.500.11822/17216/India.pdf?sequence=1&isAllowed=y> [Accessed 12 May 2021]. 

2. Chandra, A., 2021. Finding Solutions to Air Pollution in India: The Role of Policy, Finance, and Communities | ORF. [online] ORF. Available at: <https://www.orfonline.org/research/finding-solutions-to-air-pollution-in-india-the-role-of-policy-finance-and-communities-74311/> [Accessed 12 May 2021].

3. News, I. and 132 cities on board to take national clean air programme forward; IITs, N., 2021. 132 cities on board to take national clean air programme forward; IITs, NITs and CSIR institutions to guide them | India News - Times of India. [online] The Times of India. Available at: <https://timesofindia.indiatimes.com/india/132-cities-on-board-to-take-national-clean-air-programme-forward-iits-nits-and-csir-institutions-to-guide-them/articleshow/81711265.cms#:~:text=The%20NCAP%2C%20launched%20in%20January,by%202024%20from%202017%20levels.> [Accessed 12 May 2021]. 

4. Time. 2021. Air Pollution Turned India's Capital Into a 'Climate Emergency.' It's Part of a Global Trend Killing 7 Million Prematurely Each Year. [online] Available at: <https://time.com/5718012/new-delhi-pollution-2019/> [Accessed 12 May 2021]. 

5. THE AIR (PREVENTION AND CONTROL OF POLLUTION) ACT, 1981. <https://legislative.gov.in/sites/default/files/A1981-14.pdf>  [Accessed 12 May 2021].

6. mint. 2021. What is India missing in its battle against air pollution?. [online] Available at: <https://www.livemint.com/news/india/what-is-india-missing-in-its-battle-against-air-pollution-11606459726967.html> [Accessed 12 May 2021].

7. Bhuvaneshwari, S., Hettiarachchi, H. and Meegoda, J., 2019. Crop Residue Burning in India: Policy Challenges and Potential Solutions. International Journal of Environmental Research and Public Health, 16(5), p.832. 

8. Ltd., C., 2021. Significant Decline In Stubble Burning: ICAR - Chronicleindia. [online] Chronicleindia.in. Available at: <https://www.chronicleindia.in/current-affairs/201-significant-decline-in-stubble-burning-icar> [Accessed 12 May 2021].

9. Sharma, S., 2021. Air Pollution Costs India Rs 7 Lakh Crore a Year: Report - The Wire Science. [online] The Wire Science. Available at: <https://science.thewire.in/environment/air-pollution-costs-india-rs-7-lakh-crore-a-year-report/#:~:text=Air%20pollution%20costs%20Indian%20business,150%25%20of%20India's%20healthcare%20budget.> [Accessed 12 May 2021]. 

10. University of Chicago News. 2021. Addressing India’s air quality, health and climate requires public action, study finds. [online] Available at: <https://news.uchicago.edu/story/addressing-indias-air-quality-health-and-climate-requires-public-action-study-finds> [Accessed 12 May 2021].

11. Manish Gupta, “Estimation of Marginal Abatement Costs for Undesirable Outputs in India’s Power Generation Sector: An Output Distance Function Approach,” PhD diss., (Centre for Economic Studies and Planning, School of Social Sciences, Jawaharlal Nehru University, New Delhi). <https://www.nipfp.org.in/media/medialibrary/2013/04/wp05_nipfp_027.pdf>   [Accessed 12 May 2021].

12. Mathangi Swaminathan, Economic and Political Weekly. 2021. How Can India's Waste Problem See a Systemic Change?. [online] Available at: <https://www.epw.in/engage/article/institutional-framework-implementing-solid-waste-management-india-macro-analysis> [Accessed 12 May 2021]. 

13. India and Importance, A., 2021. Agriculture in India: Industry Overview, Market Size, Role in Development...| IBEF. [online] Ibef.org. Available at: <https://www.ibef.org/industry/agriculture-india.aspx#:~:text=Agricultural%20export%20from%20India%20reached,is%20estimated%20to%20reach%20Rs.> [Accessed 12 May 2021].

14. Maruti Arjun, K., 2013. Indian Agriculture- Status, Importance and Role in Indian Economy. International Journal of Agriculture and Food Science Technology, [online] 4(4), pp.343-346. Available at: <https://www.ripublication.com/ijafst_spl/ijafstv4n4spl_11.pdf> [Accessed 12 May 2021].

15. Transparency.org. 2021. Corruption Perceptions Index 2020 for New Zealand. [online] Available at: <https://www.transparency.org/en/cpi/2020/index/nzl> [Accessed 12 May 2021].