Mumbai: The environment ministry, on January 17, 2022, introduced a star rating system to incentivise states for quick disposal of environment clearance applications for development projects, which, experts say, will undermine the due diligence that is required in verifying environmentally sensitive projects.

The ratings will improve transparency, efficiency, and accountability and will promote the "ease of doing business", the Ministry of Environment, Forest and Climate Change (MoEF&CC) said.

"The ranking system reflects a twisted understanding of what environment impact assessment processes are designed to achieve," said Kanchi Kohli, senior researcher at the Delhi-based think-tank, the Centre for Policy Research. "It incentivises faster decisions over detailed appraisals before taking decisions on whether projects should be approved or rejected."

The new system has been introduced at a time when the ministry has been accused of weakening environmental safeguards in the bid to promote ease doing business, as IndiaSpend reported in January 2020.

"Such a move creates a perverse incentive for bureaucracy and other agencies to push development projects, without following due procedure, that will undermine democratic governance of resources, environment and rights of communities," said Tushar Dash, an independent researcher of forest rights and environment governance issues in India. "This is not an isolated development; there have been a series of notifications, guidelines, executive directions issued by the central government which have sought to dilute the statutory measures that are put in place to secure the interest of communities and environment."

We wrote to the environment ministry on January 21, seeking their comment on the implications of the system. We will update the story when they respond.

New rule chooses ease of business over environment

The new system proposes a star rating system for the State (or Union territory) Environment Impact Assessment Authorities (SEIAA) that rates them on seven criteria. For instance, the states receive two marks for clearing a project in less than 80 days, one mark for clearing in 105 days, zero for taking more than 120 days. On January 24, the ministry announced that there will be no negative marking in case the applications take over 120 days.

The Environment Impact Assessment Notification of 2006 provides a time period of 105 days for granting EC, which includes 60 days for appraisal, and 45 days for a decision by the regulatory authority.

The rating system creates an impetus to undermine all the statutory processes that are put in place to ensure that environment is safeguarded and the rights of communities are honored, said Dash

The SEIAA reviews projects categorised under Category B of the Environment Impact Assessment Notification of 2006. These include projects like hydroelectric power projects, mining projects that have less spatial extent and so have significantly lesser impact than Category A projects that come under the purview of the central authority.

The process comprises four stages of review: screening, to see if the activity requires further environment studies; scoping, which is where the expert committee addresses environmental concerns and prepares a terms of reference; public consultation; and appraisal for grant of or rejection of environment clearance.

"Such detailed assessments require a careful review of all material and outcomes of public hearings. Expert committees are appointed to bring in their technical and legal expertise and carry out detailed scrutiny of proposals that can have a negative impact on people and the environment," Kohli told IndiaSpend. "Limiting the role of expert committees, restricting the need for enquiry in favour of faster decision, neither benefits the environment nor project operations."

"Hasty approvals often result in social conflicts or ecological disasters as inadequate baselines and poor assessments have been the basis of recommending approvals and valid concerns are relegated to post facto studies," Kohli added.

The decision on the ratings was made after a meeting chaired by the cabinet secretary in November 2021 where they discussed rating states based on the time taken to accord clearances. "It has been decided to incentivise the states through a Star Rating system, based on the efficiency and timelines in the grant of EC. This is intended as a mode of recognition and encouragement as well as for promoting improvements where needed," said the ministry.

"There is an inherent assumption that quick decisions or approvals benefit business operations or will ease their investment flows, that will in turn improve the economy," Kohli told us. "However, the present state of the economy is not a result of environmental approval processes as rarely projects are held back. There is a deeper rut and systemic issues related to monopoly control, corruption and global investment flows that have affected India's business."

The government push for ease of doing business has been compromising environment regulation, IndiaSpend had earlier reported in January 2020. Further, 70% of rules that were applied for pollution industry categories were weakened between 2014 and 2017, once the ruling National Democratic Alliance government had come to power, we found.

Another attempt to weaken environmental safeguards

This is not the first time that the environment ministry has come up with rules that go against protecting the environment. In recent years, several such projects, including highways, power transmission lines and railways projects, have been proposed in environmentally fragile areas. In the Western Ghats, which is a critical forest area and an ecologically fragile zone, over 76 projects were accorded approval or expedited between July 2014 and March 2020, IndiaSpend reported in May 2020.

Amendments over the past three decades have weakened environmental safeguards to the extent that environmental clearances have become a paper-stamping exercise, IndiaSpend had reported in September 2020. In March 2021, the central government issued an amendment diluting the Environment Impact Assessment (EIA) framework of 2006, by exempting all projects from public hearing whose environmental clearance had expired and therefore had to apply afresh.

The 2006 notification has undergone a total of 67 alterations until July 2021. In July 2021, the environment ministry further issued new standard operating procedures (SOPs) for dealing with cases of industrial projects that are operating without prior environmental clearance under the Environment Impact Notification (EIA), 2006. But these provisions will not act as a deterrent against violations of environment norms, defeating the purpose of prior environmental clearances mandated by the EIA 2006, an IndiaSpend investigation found in August 2021.

"Demonising the environmental approval process or lowering environmental standards, has not and will not improve economic performance of projects or the economy as a whole. In the process, these projects will also lose their social legitimacy as has happened in many places already," Kohli said.

"Many of these decisions taken in favour of ease of doing business will increase possible conflicts over land and resources," said Dash.

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