Sunita Narain: Big choices for small men

DOWN TO EARTH

The Ministry of Environment and Forests (MoEF) proposal on what's called multi-stakeholder partnership on forests "" essentially bringing in corporations to plant trees on what are called "wastelands" to increase raw material supply for paper and pulp and even bio-diesel "" is a great idea in principle but will fatally undermine the prime minister's pet projects of employment generation and for inclusive growth such as Bharat Nirman.

Wastelands are defined as lands that are degraded, lying waste and unused, but this is a misnomer. These lands are degraded not because they are unused but because they are "overused". In other words, these degraded lands are intensely used and if allocated to industry, these users "" illegal but de facto "" will be affected. Their key source of livelihood and sustenance taken away. This will marginalise the already poor further, and all the prime minister's men with their poverty packages will be able to do little.

There is a right way of doing things, which will lead to massive employment and put money directly in the hands of large numbers of poor rural communities. Then there is a wrong way, which will lead to limited employment and wealth for some.

Industry wants forest land because when it grows trees on its captive plantations it can bring down the cost of production and increase its profits. As against the Rs 2,800 a tonne it will have to pay to farmers or tribals when it sells it wood, it can grow it at Rs 1,000 per tonne. The land it gets then is the mother of all subsidies.

But leave the moral issues aside. The fact also is that this grant of land for captive plantations will seriously impair the market for privately- and community-grown wood in the country. By 2002, almost one million tonne of wood was grown by farmers and tribals for industry. This is 30 per cent of the industries' wood and bamboo annual consumption. In addition, another 30 per cent is sourced from the market "" also mainly farmer-grown wood. To do this, industry has actively encouraged the development of high-quality saplings and extension work. It has integrated with its suppliers, which directly links it to the poorest in the country.

The economics are such that the cheap and discounted wood grown by industry under its captive plantations will destroy this farmer-grown wood market. The cost of raw material for this industry is roughly 11-15 per cent of the turnover if it grows its wood on captive plantations. It is 18 per cent of its turnover if farmers sell it. In other words, in one case it will maximise its profits and in the other, it will share its profits "" not too much "" with farmers and tribals. This choice will make or break India. The choice is for the government to make.