UNIT 27 ENVIRONMENT

Structure
27.1 Introduction
27.2 What is Environment?
27.2.1 Classical Understanding of Environment
27.2.2 Contemporary Understanding of Environment
27.2.3 Radical Understanding of Environment
27.3 Key Issues in the Environment Debate
27.3.1 Scarcity of Resources and Underdevelopment
27.3.2 Greater Interdependence of Nations
27.3.3 Sustainability of Growth
27.3.4 Changing Perspective on National Security
27.3.5 Environment and Development Debate
27.4 North-South Divide
27.5 Global Market and State Sovereignty
27.6 The Civil Society Movement
27.7 Combining Global and Local Needs
27.8 Summary
27.9 Exercises

27.1 INTRODUCTION
The study of environment is a story of a relationship which mankind has with nature.
The three fundamental resources of nature land, water and air are potentially powerful
living constituents of environment because they are a habitat to an innumerable variety
of life forms both big and the microscopic. One studies ‘environment’ because mankind
has pursued its advancement at the cost of these other life forms and as a result fallen
into a trap from where its own survival has become threatened. Those interlinkages
which make the spread of species on earth more wholesome and beneficial to mankind
can be understood only through the study of environment. The struggle for power and
security amongst nations is apparently a struggle for natural resources. It is at the same
time a grim reminder of the life’s fragile hold over it since in the battle between man
and nature it is always the nature which wins in the end. It is also a blueprint of the
deceitful drama that mankind evokes in this relationship as it staggers to conquer it.

27.2 WHAT IS ENVIRONMENT?

Environment is constituted of all that nature bestows upon mankind irrespective of the
boundaries which politics carves over the face of earth. To put it simply, the land, air,
rivers, oceans, ponds, forests and the total flora and fauna existing on planet earth forms
environment but it is much more than this pretty tree and tiger syndrome. It is a compact
of all those ecological relationships prevailing over earth at a given time in history.
Thus it is not just the natural resources but the relationship of men, women and all

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living creatures including the tiniest of worm or a micro organism and the gigantic
whale or an elephant with their biotic and non-biotic surroundings, their interdependence
and mutual survivability. Nature does not distinguish and discriminate among its users
and its resources are free for all use but mankind has consistently raised armies against
nature in the form of developing conspicuous technology and an opaque financial regime
which fosters a growth paradigm to counter nature and subduing it rather than for
improving its relationship with nature.

27.2.1 Classical Understanding of Environment

‘Environment’ is an elusive concept since environmentalists all over the globe have
taken differing positions in different eras of history. The early transcendentalist writers
like Thoreau, Whitman and Emerson “preached the notion of a bio-ethic, a sense of
responsibility for the earth and a plea for a basic ecological understanding before
tampering with its resources”[O’Riordan and Turner 1983:3] The return to nature and
the utopian divinity attached to nature was used to counter the value system of the
industrial society . The alienation and ruthlessness of this kind of industrial growth has
led human beings to an abyss of material accumulation .Thus nature should best be left
to itself. As Earth Firsters (an environmental group in USA) remarked: “No compromise
in defence of Mother Earth” .Such transcendentalists form the core of the environmental
movements all over the world. John Muir, the American environmentalist who formed
the Sierra Club, the powerful environmental group in USA and gave his life fighting the
Woodrow Wilson’s government to prevent the construction of the Yoshemite National
Park or Sunderlal Bahuguna fighting the Tehri Dam or Medha Patkar leading the struggle
against the Sardar Sarovar Dam or Ken Saro Wiwa fighting for the Ogoni people in
Nigeria are few examples of radical environmentalists. However while their views are
undebatable as it is well accepted that nature does not exist for man but for its own sake,
yet it is given the impression that they are against mankind and also anti-development.
It is wrongly being subsumed that they are blind to the needs and pains of mankind.
Man through his control over technology is a dominant race in nature which has usurped
the rights of all other creatures to the extent of threatening their existence and leading
them to extinction. Even amongst men those with greater control over technology have
manoeuvred larger benefits from nature thereby overdrawn from nature and also from
the share of others. Their flamboyant growth is rooted into overkill, overdig and overspill
which have pushed this spaceship earth towards its final dissolution. The greed to
accumulate and the subsequent rise of the materialistic and consumeristic culture brought
about by the industrial revolution has overstressed the carrying capacity of earth and
broken the harmony of human life. Nations have gone to war for natural resources such
as timber, coal, steel, oil and other minerals and now there are increasing incidents of
nations indulging full fledged battles for water.

27.2.2 Contemporary Understanding of Environment

As nations grow and become materially prosperous these resources deplete and the plain
truth is that there can be no progress without the use of these resources. This has
however become one greatest paradox of social sciences. Yet this progress can be
moulded in a manner that resources are used more justifiably and judiciously in a

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manner that there is ample time given for their regeneration and recharging. The growth
should also be balanced between the share of the present generation and that which
would come later as well as the share of all living creatures at a given time.

27.2.3 Radical Understanding of Environment

Environment brings with it the problem of socio-economic disparity between nations.
By sheer power of technology and science the rich nations of the North have extracted
out the resources of the poor nations of the South and in their effort to survive these
poor nations have sold off their precious resources to the North on very low rates. The
landscape of earth has become a hostage in the hands of the technologically aggressive
and materially egoistic nations. This has pitted foresight against greed and natural
diversity against monocultures. When resources disappear the first to be lost with them
are those grassroot, aborigines and subaltern communities which had survived upon
them through the ages. The global institutions of trade and commerce such as GATT
(now WTO), G-7 (now G-8 with the addition of Russia) IMF and World Bank have
been structured to assist this policy of resource use. Thus the revelations about
degenerating environmental conditions has consolidated the affected nations and societies
st
against the powerful nations of the North .This world of the 21 century encounters the
daunting challenge of 6 billion population which is soon going to be around 10 billion
ambitiously speeding towards higher living standards through the limited and disappearing
resources available from earth. This battle is in its most crucial stage as it moves into
its last great wave of decision making which would ensure the survival of earth and in
it our own survival.

27.3 KEY ISSUES IN THE ENVIRONMENT DEBATE

The study of environment today is about those momentous choices which nations will
have to make to save the biosphere, their resources, democracy and the nation state
system. The way international politics functioned and influenced the national resource
policies and the political systems of other countries is now undergoing a transformation.
Since the overthrow of the colonialism after the second world war to the publication of
the report ‘The Limits to Growth’ in the beginning of the second developmental decade
in USA national policies subscribed to two entrenched beliefs which had been in
circulation since the industrial revolution: first, that nature exists for man and second,
that environmental conservation is anti-growth, anti-progress and anti-technology.

27.3.1 Scarcity of Resources and Underdevelopment

The Stockholm Conference in 1972 which followed the publication of ‘The Limits to
Growth’ stunned the speeding industrialisation. At the same time the publication of the
book ‘The Silent Springs’ by Rachael Carson shook off the apathy and silence of those
who stood and watched the destruction occurring through the massive destruction of
forests and wild life , irresponsible spread of chemicals in nature and food chain and
the gradual effacing of the community resource systems. Barry Commoner writes:
“Human beings have broken out of the circle of life, driven not by biological need , but
by the social organisation which they have devised to ‘conquer’ nature: means of gaining

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wealth which conflict with those which govern nature”. The attempts of the
underdeveloped and developing countries to catch up with the West and repeat their
economic miracles, has led to poverty, indebtedness and a steady decline in the supply
of essential goods. The accumulating debt has put the developing countries in a trap of
underdevelopment. These countries are forced to overuse their environment to overcome
the possibility of their liquidation. So much so that the debt services alone amounts to
between six and seven per cent of their gross national products [Parkin 1992:8]. More
than eight hundred million people around the world live below the poverty line with
endemic malnutrition and no access to primary health services. As industrialisation and
urbanisation progresses, the people of the poorer regions lose their habitat and their
resources.

27.3.2 Greater Interdependence of Nations

Since nature does not observe boundaries there are rivers, forests, mineral wealth, wild
life, rich mangroves and aboriginal communities which are spread from more than one
country and their ecological bonds have transcended their political boundaries. Thus any
action by one state sends waves of disturbances to the neighbours. For example the
Indus region between India and Pakistan is a home to some of the rare species of fish
and mangroves while it also acts as a natural wall to the sea currents. Any action of
pollution, effluent discharge or destruction of mangroves affects the resource flow of the
other country as well as the natural protection to their coastal belt. The world wide
bleaching of corals all over the Indian Ocean coastal belt in 1985-86 had been attributed
to the sea bed nuclear tests conducted by France and China. International rivers such as
Rhine in Europe or Ravi between India and Pakistan have remained contentious issues
between them for the development policies which these nations have undertaken at its
catchment zones. The oil fields of Siberia or Kuwait which have spread underground to
other states are presently forcing these states to enforce action against their overuse and
help conservation measures on riparian states. The ozone hole is the best example of
what industrial action in developed states can do to damage rest of the world environment
and health of people. Some developmental action in one state may send earthquakes, sea
storms, hurricanes or even drought in other states. The studies related to geological links
of the earth’s stratosphere, troposphere, hydrosphere and tectonic plate action along
with the revelations from remote sensing technologies have proved that no state could
be given unrestricted and unrestrained right to undertake its industrial adventures. People
are so much affected by environmental crisis that it has even forced them to enter civil
war like situations rendering millions to leave their home and hearth to become ecological
refugees. The UN High Commissioner for Refugees and the International Red Cross
Society are appalled by the ever increasing number of ecological refugees worldwide.
The state sovereignty is restrained by these natural rights of inhabitants of this earth
which are sacrosanct and uncompromising. Unless the global economy is reoriented to
overcome these destructive processes of growth, the wide gap between the living standards
of different countries and their populations environmental crisis is likely to hurt the
democratic process and may also pose a major threat to the nation state structure. The
study of comparative politics as well as security discourses are affected by what one
may refer to as the ecosystem politics which has internalised one of the strongest battles
for power in the international arena. Conventional studies had missed out on this crucial

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disputes and work concertedly for the betterment of human life and sustainable material
advancement. Global trade and trans-national companies are seen as dominant factors
in pushing their trade agendas into national policies. The journey from Rio (1992) to
Seattle (1999) has demonstrated the rising discontent and rebelliousness amongst citizens
of both the developed and the developing countries against the official insolence towards
environmental demands in their trade policies. Environmental problems are problems of
development and of international cooperation. They are also very much part of a broader
‘system’ and cannot be taken in isolation. However environmental issues are right now
the political problems of the highest order since they have grown in complexity and
often lack the unified political constituency to lobby for them. The degree of degradation,
depletion and degeneration of environmental resources are different in different countries
and so the scale of priority to these varying problems also differs.

27.3.5 Environment and Development Debate

The protection of environment is always associated with some form of visible slowing
of the industrialisation process. This is because many short cut methods and cheap
processes which jump over the limitations of resource availability and community rights
over them are used for rapid production and growth. When The Limits to Growth was
published in USA, the industrialists consolidated their cadres against environmentalists
into an aggressive battle in which they termed them as ‘anti-industrialisation’, ‘anti-
development’ and ‘anti-growth’. The idea which was floated by them was that
environment and development stand against each other and one cannot have both at the
same time.

This debate is an outcome of the two different ways or value systems in which the
environment was conceptualised in the developing and the developed countries. Although
the conservation movement has a class connotation in the sense that the social force
emerging out of it may pose a threat to the fragile agrosystems on which the world’s
40 per cent of the poor eke out a living. It has been referred to as the pretty trees and
tiger syndrome in India. This was quite obvious in the debate that emerged in the United
Nations in 1972 when it completely subordinated the need for environmental conservation
for the developing countries: “It may be premature for many of them to divert their
administrative energies to the establishment of new institutions or machinery” [UN
1972:27]. It was comfortably assumed that environmental action could wait for
development to take over and thus on one hand the developed nations were able to
divest themselves of their responsibility towards funding for environmentally clean
technology, on the other hand they were also able to put off their obligation towards
restricting biodiversity exploitation and climate change. It was in this period that effluent
discharges from the chemical industries, agro-businesses, biotechnology research and
nuclear weapon proliferation programmes ruthlessly devastated the meagre resources
that the South could have laid their hands on. The symptomatic manifestation in the
form of Ozone Hole, the Greenhouse Effect and the Sea-level rise became realities of
the aggressive industrialisation pursued by the developed countries. This principal
weakness that was inherited in the environmental history from its womb led the world
to a stage when solutions always got meshed up into newer problems. The Stockholm
Conference passed 26 main resolutions and 109 recommendations but a review which

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was undertaken ten years later revealed that it was not just the population explosion that
had nullified development but the enormity and intensity of the toxins in air, water and
land polluted the planet beyond human control. The list of endangered species of plants
and animals had bloated to threaten the very existence of mankind. The World
Conservation Strategy of 1980 for the first time presented a proportionally better view
of the problem diagnosis by linking developmental processes with the environmental
distress and thus laid the foundation of the interlinkages and interdependence prevailing
between the two. It laid at rest the perceived dichotomy between environment and
development and suggested a three pronged action in the following areas:
• Maintenance of essential ecological processes and life support systems
• Preservation of genetic diversity
• Sustainable utilisation of species and ecosystems.
However the World Conservation Strategy was far from indicating the need for political
and social changes which were required to achieve the conservation goals. In the same
year the Brandt Commission Report also acknowledged the threat that would come to
the developmental policies due to environmental deterioration in poor countries yet even
this report failed to point out the various biases splitting the environmental perspectives
from within. An integrative and a wholesome approach towards this problem of
environment got meddled into global politics of natural resources sharing which indicates
the status and availability of resources and their consumption pattern across the globe.
This aspect of resource sharing which bridges the environment-development dichotomy
was brought into an analytical framework by the Brundtland Commission Report of
1987 and its flowering took place in the Rio Meet of 1992 when the Agenda 21
benchmarked areas which sent warning signals to both the North and the South. This
was found to have deep inroads into the political and social structures dominating global
governance systems. The environmental framework for conservation was linked to policies
being adopted to deal with the problems of Population, Urbanisation, Social Development
and Women, and it is here that a combined and coordinated approach towards environment
and development found a foothold. At the Rio Conference which was more appropriately
called the World Conference on Environment and Development or the Earth Summit it
was well understood that environment and development cannot be dealt with in separate
chambers since they question the existing framework of resources sharing between the
rich and the poor nations and within countries between the dominant groups and the
subsistence communities. It raised a fundamental debate on development policies such
as: who pays the price and who benefits out of development projects undertaken by
international donor agencies? An analysis of the consumption pattern of fossil fuels,
forests and pollution rendered to air and water through the pattern of industrialisation
gave sufficient evidence that the consumption pattern of the Northern industrialised
states was the real culprit which had effectively blocked any sane action towards
environment protection. The ensuing debate exposed and explained the persistent apathy
shown by the developed and industrialised states towards restructuring the global
economic and political institutions and, rather diverts attention towards the poverty
trapped nations as the real culprit of environmental degradation. A real leadership was
required in the international system particularly in the United Nations to break through

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this technological trap and explore a just transition towards a sustainable paradigm of
development. India’s membership in SAARC, G-15 and G-77 can open avenues towards
the sustainability of the new free trade global regimes. In the liberalising and globalising
world, the following areas of environmental studies have become the policy priority for
all environmental organisations:
• Resource use in the context of biodiversity conservation.
• Technology and its Impact on climate change.
• Environmental governance and Impact Assessment of projects.
• The traditional rights of indigenous people over their resources.

27.4 NORTH-SOUTH DIVIDE

Since the Stockholm conference of 1972 it was becoming increasingly clear that the
priorities of the developed and the developing countries were prominently different and
both aspired to achieve them through lobbying in the global environmental conferences.
With each conference it appeared clearer that the polarisation of the industrialised and
the Third World countries tended to become stronger and more consolidated like the
two segregated worlds. The vision of the earth as a planet where they both resided
together became blurred into the emerging politics of resource distribution and sharing
of conservation responsibilities. The debates which emerged out of the different
perspectives of the developed and the developing countries centred round the issues of
the consumer needs vs. the basic needs, the relationship of physical environment to
intractable rural poverty in the Third World and the policy priorities of their governments,
the semantics as well as the terminology used by the developed countries in conservation
measures differed from that used in the developing world as the environmental policies
in the former were largely influenced by the global corporations. It also emerged from
the debate that while the developed world of G-8 was more interested in trade monopoly
and empowerment for liberalising market transactions, the developing world consistently
strived to achieve more justice and equitable sharing in the global trade agenda which
was more appropriately a redistributive agenda for achieving environmental justice.

Several groups emerged and to legitimise the flow of resources from the South
international institutions were also created to legitimise their policies on economic
grounds. Much of this divide between the North and the South had been the result of
the Bretton Woods economic institutions which encouraged and protected the unequal
trade laws in favour of the Northern industrialised states. In 1964 Raul Prebisch as the
Secretary General of the UNCTAD had wisely warned that if this economic trend
continues the North will have to wind up its market prosperity since their trade was
directly linked with the economic and social well being of the Less Developed Countries
of the South. He had thereby suggested that the North should contribute 1 per cent of
their GNP towards the development of the South. However till the Earth Summit in
1992 the South was still asking for this financial commitment from the North which
they drastically failed to attend to. Only four donor countries currently meet or exceed
this level of aid: Norway (1.04 per cent), Sweden (0.94 per cent), The Netherlands (0.94
per cent) and Denmark (0.94 per cent). The United States provides less than 0.2 per cent
of its GDP in official development assistance (ODA) placing it last in the eighteen

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OECD donor nations.[Hempel 1996:36] .Hence it was branded as the ‘skunk at the
picnic’ during the Rio deliberations. Thus environmental conservation effort became a
lever for redistributing wealth [Hempel 1996:36] and creating institutions for controlling
earth’s finite resources.

The North-South divide is a simple geopolitical distinction to describe the spill of the
global power politics since the Second World War. The rich nations which have attained
a certain level of a comfortable industrial development are led by the Group of the Eight
or G-8, whereas the less developed nations of the South have consolidated into Group
of seventy seven nations or G-77. The G-8 controls the monetary wealth and technology
through which it is able to make benefits out of the raw materials which the South is
forced to sell due to its technological and also financial backwardness. However the G-
77 controls more than 125 nations of the South which have rich biodiversity but they
also have one of the most poverty stricken pockets of the world due to environmentally
devastated land and forests. For these nations of the South it was walking on the razor’s
edge to obtain funding from the North but also to prevent any imposition of eco-
imperialism which comes as a condition to aid. During the Rio Summit the divisions
between the North and the South were quite pronounced in case of the biodiversity
Convention. The richest 70 per cent biodiversity was concentrated in the identified 12
‘mega-diversity’ countries [Mexico, Columbia, Ecuador, Peru, Brazil, Zaire, Madagascar,
China, India, Malaysia, Indonesia and Australia.] The developed countries wanted the
developing countries to take action for the preservation and conservation of their
biodiversity resources. However the cost of the most basic biodiversity protection
programmes were in the range of $ 10 to $14 billion per annum whereas the technological
benefits derived from the genetic resources would go into the pockets of the Western
Trans National Corporations (TNCs) [World Conservation Monitoring Centre: 1992 ].
Therefore the ticklish problems of ‘Biotechnology’, ‘Patents’, ‘Role of TNCs’ and the
much debated ‘Intellectual Property Rights’ added further complications to the acceptance
of the Biodiversity Convention. Despite all odds and strong opposition by its greatest
trading partner USA, Canada was the first industrialised nation to ratify the Convention
on Biological Diversity (CBD) in defiance of its JUSCANZ whip. The three main
objectives of commitment towards Biodiversity Convention related to the long term
collaboration plans between the developed and the developing nations are
i) Conservation of Biological Diversity
ii) Sustainable use of Biological Resources
iii) Fair and equitable sharing of benefits resulting from the use of genetic resources.
Besides Biodiversity, ‘Climate Change’ is another area for international muscle flexing
by the developed countries. The socio-economic consequences of climate change
especially the impact of climate change upon the agriculture based economies of
developing countries will have serious global fallout. Canada’s energy consumption per
capita is among the highest in the world, owing mainly to the large natural resource
availability and the high concentration of the energy intensive industries. This has
resulted into severe environmental problems like the high concentration of nitrates in
rivers, water use, chemical production, auto traffic and nuclear waste, CO2 emissions.
Canada had initially been loyal to its JUSCANZ [Japan, United States, Canada, Australia

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and New Zealand] group when the climate change initiative was jointly taken up by the
World Meteorological Organisation (WMO) and United Nations Environment Programme
(UNEP) in 1988. The corporations disputed most of the findings of the climate change
panel since they were the producers of most of the greenhouse gases. The industry lobby
especially of the oil companies lobbied through Global Climate Coalition and the Climate
Council another industry group which accompanied the US delegation to the UNEP
meetings. UK had not been directly affected by this pollution since the wind carried
away the pollution towards the Arctic and Europe. Europe and the Alliance of the Small
Island States were directly threatened from pollution and ocean rise which would
submerge their homelands. Thus the JUSCANZ group wanted to weaken the language
of the climate change initiative by diverting the debate to the one on ‘sources’ and
‘sinks’. This reasoning suggests that carbon emissions that a country releases in air must
be counter balanced by ‘sinks’ that absorb the emissions such as the forests located in
the Third World, or by a reduction process through the development of alternative
technologies elsewhere. The Kyoto protocol on climate change came up in December1997
which prescribed that by 2010 emissions of six greenhouse gases [Carbon dioxide,
methane, nitrous oxide, hydrofluorocarbons, perfluorocarbons and sulpher hexafluoride]
were to be reduced to approximately five per cent below 1990 levels. In July 2001 many
developed countries were found bargaining for credit if they were able to reduce
greenhouse emissions by selling technologies to developing countries. US connections
within the JUSCANZ group hijacked the essence of the Kyoto Protocol. As a result of
this, the Bonn outcome compromised on carbon sinks domestic reductions and financing
for underdeveloped nations. Caroline Lucas the British Green Euro MP regretted the US
attitude on climate change saying: “We are fast going to become the only species on
Earth to monitor its own extinction rather than taking steps to prevent it” [Pole, 2001:217].
Sierra Club of Canada an international NGO had shown serious concern about the
warning US Ambassador Paul Cellucci had issued to the other group members for
ratifying the Kyoto Protocol.

The UNCED Meet at Rio had demonstrated that sustainable development comes at high
price. The rich nations of the North had promised to share this additional burden for
developing nations. Regrettably since then, official development assistance (ODA) has
fallen from US$60.9billion to US$53.1 billion. Moreover the donors come with a trap
for the poor nations in the form of good governance or market adjustment programmes.
Thus ODAs which were expected to promote sustainable development only constricted
recourse to alternative models of development. As a result of this noose, developing
nations found an alternative method of funding through foreign direct investment (FDI)
which is investment in country’s business by transnational companies and it has in the
last few years far surpassed the ODA funding. However since all these TNCs belong
to the developed nation groups like OECD and G-8 the new problem that persists in
continuation to the older one is the commitment and preparedness of these new global
corporations towards sustainable development and more appropriately towards sustainable
environmental management therefore the new liberalised trade regime has further polarised
the north-south divide. The consumer society of the West which has been able to
provide a reasonable material security to its people has on the contrary exposed the poor
nations to intractable environmental degeneration and natural disasters. Development
has become more intricately linked to the global market processes and the politically

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powerful lobbies of the global corporations. The 2002 World Summit on Sustainable
Development in Johannesburg has echoed the concerns for the shortcomings of climate
change initiatives. For the people of the South it is an extremely challenging moment
since all their future growth and development largely depends upon the recognition in
concrete terms of the principles of equity and justice in setting environmental standards.
This enterprising endeavour may be sufficiently supported by the election of the Indian
expert Dr. R.K.Pachauri as the Chairman of the Inter-governmental Panel on Climate
Change. It will be India’s most unenviable task to bring differences within the developed
countries such as that between USA and Canada, the two highest producers of greenhouse
gasses and fossil fuel (Coal and Petroleum) consumers to the negotiating table and at
the same time provide justice to developing economies of the South.

27.5 GLOBAL MARKET AND STATE SOVEREIGNTY

Market has become an important factor in considering and planning any action towards
environmental conservation and sustainable pattern of trade. The globalisation of trade
and the subsequent adaptation of national policies towards an effort to prevent
marginalisation in the international market have led to the subordination and also
reinterpretation of the term ‘environment’. This has manifested itself in all international
organisations for finance and trade such as the UNCTAD, WTO, IMF and the World
Bank. This is also a beginning of the return to aggressive capitalism zealously guarded
by the trans-national companies and thereby it is strongly resisted by the civil society
and peoples voluntary groups all over the world.

Korten recollected Willis W.Harmon’s words that, ‘business has become, in this last
half century, the most powerful institution on the planet. The dominant institution in any
society needs to take responsibility for the whole.’[2001:230] At present when more
than US$1.4 trillion in foreign exchange floats transnationally for speculative profits,
the following two beliefs about business need to be looked into with increased sobriety.
The growth of firms and global companies was so rapid that by mid 1990s the stupefying
statistics was alarming. In 1995 the UNCTAD study found that there were 40,000
corporations in all, they controlled two-thirds of the world trade in goods and services
[Raghavan, 1995:31]. Korten [2001:231] also reports that of the world’s largest
economies, 51 are corporations. Only 49 are countries. The economy of Mitsubishi is
larger than that of Indonesia, the world’s fourth most populous country and a land of
enormous natural wealth.

At present 15 of the world’s largest TNCs have an income larger than the GDP of 120
countries. Therefore the former Chief Economic Advisor of the Indian Government
called them as the new emerging global government ‘A World Inc. Ltd.’ with G-7 as
the Board of Directors. [Kothari, 1993:315] It was evident that this largest institution
of the world was an ambitious starter and had to be hooked and domesticated according
to the needs of the society. The events at Seattle, Prague and Genoa Summits testify the
failure of Corporate Governance in planning a sustainable environmental future. The
rising discontent with the environmentalists, farmers and labour is a manifestation that
Corporate Governance should be accountable to the civil society groups across all
national boundaries where there Corporations are spread. Thus global corporate

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governance for sustainable development was largely about balancing the demands for
accountability and responsibility towards people and their natural resources. Its three
main pillars were constructed out of its capacity to deal with the issue of scarcity, issue
of carrying capacity and the intra-generational and inter-generational equity and justice
[Singh 2000:52-64].

The trade regime of TNCs has basically three kinds of impacts on environment and on
natural resource use associated with international trade.[OECD 1997]

• The scale effect, which is a positive impact of international trade on economic

growth but it increases environmental damage.
• Composition effect, which is associated with impacts on industrial structure due to
trade specialisation that may be positive or negative on environment depending
upon the country’s specialisation.
• Technical effects, which is the impact of international trade on economy that is
expected to reduce environmental damage and natural resources requirements of an
economy.
As the report says, the net impact of trade on environment is a balance among all these.
Thus international trade delinks the economic and the ecological systems of a country
which becomes the central issue of global corporate governance. The Business Charter
for Sustainable Development adopted by the International Chamber of Commerce (ICC)
in November 1990 emphasised the need for making environmental management the
highest corporate priority. Yet, since then the repeat of corporate environmental crimes
with blatant disregard for the conventions and regulations of the host country has not
only intrigued but scandalised the civilised world. These corporations have traded poverty
of poor nations by affecting national policy changes and host nations have succumbed
to unsustainable policies for short term monetary gains. Land, water, air and forests the
four major resources are severely damaged. Structural adjustment to market friendly
economy has led to the large scale diversion of land from food crops to cash crops,
rivers have been dammed with suspect hydroelectricity schemes, forests are turning into
consumerist monoculture commodities and the freedom to spew greenhouse gases into
air has destroyed the ecological sustainability of countries where their operations are
spread. This structural transformation of economy is creating a mirage of growth which
has also led to macro-economic volatility and political instability. Free trade with
unaccountable corporate actors is only leading to greater centralisation, corruption and
cultural distortions and this by no chance can sustain growth and development on a long
term basis. The craving for FDI and the gradual replacement of ODA by FDI has given
a firm control of resources in the developing countries to the TNCs. Between 1981 and
1996 FDI in the less developed nations has grown from US$31 billion to US$244
billion [IIF 1997, UNCTAD 1995]. Interestingly the official development assistance
(ODA) has been dramatically replaced by foreign direct investment (FDI). In 1990
ODA constituted 56 per cent of long term flows to developing countries but in 1998
while the ODA share came down to 18 per cent FDI increased by five times from 44
per cent or US $ 209 billion to US $ 1118 billion in 2000 [Sharma and Narain, 2002:36-
41]. Thus globalisation and liberalisation has provided greater freedom and a larger

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space for business in the world. Transnational Companies have become the greatest
players in world economy and the greatest single factor in ecological crisis also. At a
time when the countries are in a stampede for gaining a comparative advantage over
others in foreign direct investment [FDI] TNCs are able to manage a beneficial bargain
vis-á-vis the government. It was on their insistence that the Uruguay round of negotiations
introduced three new areas in it—Trade Related Intellectual Property Rights (TRIPS),
Trade Related Aspects of Investment Measures (TRIMS), Trade in Services. The three
taken together perpetuate their ‘Corporate Monopoly over Third World
resources.’[Shiva1993:243] However the silver lining is that despite the powerful presence
of TNC supporters in the decisive trade talks such as Director General Mike Moore, US
Trade Representative Charlene Bershefsky and the European Union’s Trade Commissioner
Pascal Lamy the people’s organisations could enforce a total turnaround for the TNC
agenda at Seattle. This can be seen as a reaction to the massive privatisation drives
being undertaken which were cutting down on environmental and welfare measures to
pamper TNCs. The World Bank Report , Globalisation, Growth and Poverty,2001
demonstrates that globalisation is the only alternative to poverty and economic
backwardness. The apt comment of Vandana Shiva, ‘either you get integrated into
global market economy dominated only by the objective of profit or you are thrown out
of all economic options for survival.’ [1993:243] This has forced nations to enter the
Structural Adjustment Programmes or more appropriately the Economic Recovery
Programmes in which to maintain their economic targets they overuse and overexploit
their resources. The Case of ENRON Dhabol Thermal Power Station in Maharashtra
fully proves the enormous influence TNCs hold over national governments through the
use of large sum of unaccountable money to push environmentally disastrous projects
into developing countries.

27.6 THE CIVIL SOCIETY MOVEMENT

The process of rapid industrialisation and urbanisation has led the development experts
to undertake mega projects of growth without acknowledging the livelihood requirements
and survivability of the local human and animal communities. Ecosystems have been
ruthlessly destroyed due to lack of proper assessment of their impact thus disturbing the
balance of nature. State and society have distanced since this decade and as a reaction
the society has started consolidating itself against the injustices of the state. The decade
of 1980 witnessed the spread of a large number of mega projects for power generation,
mining, quarrying and meat production. This led to massive deforestation, damming of
rivers and devastating pollution of land, rivers, air and wetlands, grievous loss of milch
cattle and grazing grounds which affected villagers in large numbers. Thus there have
been movements to prevent deforestation like the Chipko in the Himalayas and Apikko
in the Western Ghats, Silent Valley movement against the Kudremukh power project,
Tehri and Narmada movements against the Tehri power project in Garhwal region and
Sardar Sarovar project over Narmada River adjoining Madhya Pradesh, Maharashtra
and Gujarat. Villagers have also organised themselves against the ambitious modernisation
schemes of government. The setting up of mechanised abbatoirs by some transnational
companies in Hyderabad has evoked strong protests not only by the butchers but also
by the Cow Protection Groups of Villagers for fear of losing out their best breeds to

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such high intensity mechanical slaughtering. In Banaras, the Sarva Sewa Sangh, in
Bihar ‘Ganga Mukti Andolan’ , Panna Mukti Andolan, Mannu Raksha Koota ,Koel
Karo, Mulshi Satyagrahis and the Vishva Machuara Sangathan. Finally in December
1992 the creation of National Alliance for People’s Movement brought more than 150
grassroot organisations together. Even in the West civil society consolidation in the
form of specific issue based grouped such as Tree Sitters, Friends of the Earth, Green
Peace, Friends of the Wolf, Earth Firsters are some of the initiators in consolidating
people’s consciousness against the state power of destruction. However this civil society
consolidation has brought in severe reaction from State administration. The murder of
Ken Saro Wiwa, the leader of the Ogoni Tribe Protection Group against the Shell
Company in Nigeria, killing of Gangaram Kulundia in Bihar who led the Icha-Karhai
Visthapit Sangh and several others rape and molestations of tribal women protestors of
the Green Belt Movement in Africa and Narmada Bachao Andolan [NBA] in India are
some of the few atrocities committed by the state leading to the consolidation and
recreation of Human Rights Movements across the world.

The Seattle Conference of December 1999 has sufficiently demonstrated the unification
and convergence of the civil society groups across national and ideological boundaries
to question the domination of the G-8 countries over environmental policies of the
world. The UN Conference on Environment and Development (also known as the Earth
Summit) was the outcome of an intensive two years preparation of 35,000 people, 106
heads of state or government and 9000 journalists. This Summit gave an unprecedented
access to public interest groups, non-governmental organisations (NGOs) and the business
groups represented through the TNC representatives. The unbalanced production and
consumption levels prevailing in the world and the decreasing official development
assistance (ODA) were pointed out as the villain of environmental sustainability. This
was followed up at the 64th meeting of the Development Committee at Ottawa on
November 18, 2001 under the Chairmanship of Mr. Yashwant Sinha, Minister of Finance
of India. The central concern of the Conference deliberations was the assessment of
Poverty Reduction Strategies. This was further discussed at the Finance for Development
(FfD) Conference in April 2002 at Washington. The Conference emphasised enhancing
the ODA flows and harmonisation of the government agencies with private sector and
the civil society so that poverty eradication exercises could be improved upon.
Environment is becoming highly politicised and intricately woven with global politics.
The spread of communication networks through e-mail, fax and cell phones has
revolutionised environmental activism and made recalcitrant governments more vulnerable
to them. Internationally spread NGOs like the Sierra Club, Friends of the Earth,
Greenpeace, World Wildlife Fund , Gene Camp, Centre for Science and Environment,
Narmada Bachao Andolan, National Alliance for People’s Movement and Navdanya
tend to gang together despite their different origins.

As a result of the increasing civil society protests a multilateral framework for the
environmental review of official export credit activities has been undertaken by the
OECD countries which are a home to the majority of the TNCs. This framework aims
towards ‘Common Approaches on the Environment and Officially Supported Export
Credits’ and sets minimum requirements for the environmental review of OECD supported
projects. The growing corporate lobby is influencing decision making and has been able

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to delay and deny the adoption of some crucial environmental commitments. The Tenth
Session of the United Nations Commission on Sustainable Development (CSD10) in
May 2002, and the recently concluded World Summit on Sustainable Development
(WSSD) provide an opportunity for reassessment on the platform provided by the civil
society. The themes which have drawn considerable attention may be mentioned as;
• Stewardship for environmental action
• Alternative and Appropriate technology
• Sustainable Communities
• Population and the Environment
• International Governance.

27.7 COMBINING GLOBAL AND LOCAL NEEDS

Environmental protection demands a two pronged action. One, on the global front
where international trade institutions are perpetuating the regime of the trans-national
companies; and the other action has to go down to the grass root level where the
resources are generated and expropriated out of the control of the people who are
generally aboriginals, forest dwellers, subalterns and rural folk. The problem that exists
and would continue to trouble nations is primarily the process of institutional and
regulatory changes in the natural resource policies. The panic for increased FDI flows
threatens environmental demands raised by the grassroots societies. States have been
found to bargain for lesser regulations in trade and environment.
This requires some major changes for good governance which would ensure transparency,
accountability and a more effective clarification of the property rights of communities.
Developing and transitional economies need to cooperate, collaborate and coordinate
their efforts with specialised and expert groups in international organisations to regulate
the just flow of FDI [FDI Confidence Index, 2001:36-38]. As one such group called the
Global Corporate Governance Forum explains in its agenda, “Good governance is a
source of competitive advantage and critical to socio-economic progress” [2002:1]. This
also opens up doors for spurious technology, dumping and tradeoffs between growth
and environment. India and other Third World nations have low ‘income elasticity’ for
environmental protection. Thus the FDI policy becomes arbitrary and contentious. Their
governments make several policy compromises and trade offs on governance. The Enron
exposure reveals the phenomenon of FDI flows to India. This situation can be overcome
only through the establishment of fair, transparent and accountable institutions of
governance. The whole debate on setting standards for environmental action leads one
towards the norms of common heritage, equity and security which have been by far
amiss in international deliberations on development. Their incorporation in environmental
governance demands a thorough restructuring of political-economic institutions in the
world. Democratic governance is the starting point for environmental action but the
TNC dominance has obliterated democratic functioning of institutions. A demand for
deliberative democracy in which citizens directly engage themselves in self-government
or a more participative framework in which representatives are not allowed to hijack the
real issues towards populist policies.[hempel 1996:218]. This leads scholars to return to
Schumacher’s much cherished ideal of ‘Small is beautiful’. Small group settings with
high use of electronic media for a baseline survey of the problem, before coming to

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