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The Need To Walk The Green Path In A Post-Covid World

Complying with environmental laws will help businesses discharge their legal obligations besides ensuring commercial success thus making the Indian economy stable and climate resilient.

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This pandemic has ensured a course correction on many counts, not just in the way we lead our lives but also in the manner we would conduct business hereafter. While environmental risks like air and water pollution, mismanagement of waste, fresh water depletion, forest and biodiversity loss had become a major cause of concern in the last few years, this pandemic has only made it more evident. It has made us realize that such risks not just affect the environment and community but are also crucial for the survival of businesses. Therefore, it is in the interest of businesses that they contribute towards building a low-carbon economy.  

The need for balancing economic goals with environmental objectives has also been emphasised by the Indian judiciary from time to time. A three judge bench of the Hon’ble Supreme Court of India in the often cited judgment in the case of Indian Council for Enviro-Legal Action v. Union of India observed that, 

“Both development and environment must go hand in hand, in other words, there should not be development at the cost of environment and vice-versa, but there should be development while taking due care and ensuring the protection of environment.”

Adopting the path of ‘green growth’ has the potential for harmonising India’s economic development with environmental protection and thus helping India achieve its Sustainable Development Goals (SDGs).

The concept of ‘green growth’ refers to economic growth which is socially and environmentally sustainable. This concept had its origin at the Fifth Ministerial Conference on Environment and Development held in 2005 at Seoul, where 52 Governments and other stakeholders from Asia and the Pacific Region agreed to pursue a path of ‘green growth’. In the Indian context, ‘green growth’ finds its mention in the Thirteenth Finance Commission Report which states that “green growth involves rethinking growth strategies with regard to their impact on environmental sustainability and the environmental resources available to poor and vulnerable groups.”

Water shortage has been undermining India’s ability to produce power. A paper published by World Resources Institute in 2018 found that 14 out of 20 largest thermal utility companies in India experienced one or more shutdowns due to water shortages during 2013 to 2016, costing these companies over $1.4 billion in total potential revenue from the sale of power. Instances like this highlight the turbulence that natural resource depletion may cause to business operations. Green growth provides answer to this challenge as it aims at fostering economic growth while ensuring that our natural resources continue to support it in a balanced manner. An example of this would be the use of alternative fuels in industries like cement which not just helps in cost-cutting but also helps in contributing towards environmentally sound disposal of waste and minimising emission of greenhouse gases (GHG). 

Sustainable business practices are becoming imperative for business operations both locally and globally. As per the Global Risks Perception Survey 2020, environmental concerns dominated the top long-term risks by likelihood among members of the World Economic Forum’s multi-stakeholder community. India Risk Survey 2019 released by Pinkerton and FICCI indicates natural hazards as the second most important risk to business operations in India. 

Other than availability of natural resources, consumers are also influencing the economic drivers of doing business. Mahindra Group’s inaugural ‘Alternativism’ report revealed that four out of five (80 per cent) Indians are aware of the impact of plastic and waste management on climate change. 

Environmental rule of law is central to green growth. It connects the concept of sustainability with fundamental rights and obligations, thereby forming a basis for improving environmental governance. Since the last few years, courts in India have come down heavily on businesses operating in violation of environmental laws and standards. This trend is only going to increase in the coming days as sustainability and ‘green growth’ are no longer a luxury but a compulsion in the changed world. 

While the Supreme Court of India and the High Courts have consistently strived to uphold the principles of sustainable development and environment protection, the establishment of the National Green Tribunal (NGT) in 2010 has improved enforcement and thus environmental compliance in India. A significant share of environmental disputes brought before the NGT for adjudication pertains to adverse impact of industrial operations on environment. Of late severe penalties are being imposed by NGT on polluting industries. Recently, in the case of Charudatt Koli v. M/s Sea Lord Containers Ltd., NGT imposed a fine of Rs. 286 crores on four business entities as compensation for damage by holding them responsible for “gas chamber” like conditions in certain areas of Mumbai.

With the global policy making focusing on green growth, it is imperative that businesses realize that going forward the nature of growth will matter more than the scale of their growth. Complying with environmental laws will help businesses discharge their legal obligations besides ensuring commercial success thus making the Indian economy stable and climate resilient.

Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house. Unless otherwise noted, the author is writing in his/her personal capacity. They are not intended and should not be thought to represent official ideas, attitudes, or policies of any agency or institution.


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Nawneet Vibhaw

Nawneet Vibhaw is a Partner at Shardul Amarchand Mangaldas & Co

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Ashutosh Senger

The author is an Associate in the Environmental Law practice at Shardul Amarchand Mangaldas & Co.

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