Chhattisgarh First State to Link Forest Ecosystem with Green GDP

Chhattisgarh has introduced an innovative plan that connects the ecosystem services of its forests with the Green Gross Domestic Product (Green GDP).

• The move highlights the direct link between significant environmental contributions of forests like clean air, water conservation, biodiversity and the state’s economic progress.

What is Green GDP?

• Green GDP is an alternative metric for gauging economic growth that takes into consideration the environmental consequences linked to economic activities.
• The origin of Green GDP can be traced back to the 1993 United Nations publication, “Handbook of National Accounting: Integrated Environmental and Economic Accounting.” 
• This handbook, developed under the framework of the System of Environmental-Economic Accounting (SEEA), introduced the concept of monetary valuation of natural resources.
• Calculation of Green GDP: 
  • Essentially, it proposed subtracting the cost of natural resource depletion and environmental degradation from the traditional Gross Domestic Product (GDP) to arrive at a more accurate reflection of economic well-being. 
  • This adjusted figure was termed “Green GDP” or “Environmentally Adjusted Domestic Product.”

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Key Assessment Parameters to Determine the Economic Value of Forests

• Carbon Sequestration: Quantify CO₂ absorbed and O₂ produced by trees, assigning market value to include in Green GDP.
• Water Resources: Evaluate the economic impact of water conserved and supplied by forests through rivers, springs, and watersheds.
• Biodiversity: Assess the role of forest fauna (animals, birds, insects) in maintaining ecological balance and supporting agriculture.
• Soil Conservation: Measure the prevention of soil erosion and its contribution to sustainable farming and land productivity.
• Climate Regulation: Analyze the forests’ role in temperature regulation, rainfall patterns, and climate stability for economic valuation.
• Recreation and Tourism: Estimate the revenue generated from eco-tourism and recreational activities in forested areas.

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