Natural Capital Accounting and Valuation of Ecosystem Services - India


Mainstreaming biodiversity and ecosystems into policy through natural capital accounting

Project overview

India is taking part in an innovative multi-year project to advance the theory and practice of ecosystem accounting.  It joins four other countries - Brazil, China, Mexico, and South Africa - as part of the Natural Capital Accounting and Valuation of Ecosystem Services (NCAVES) project, funded by European Union, and implemented by the United Nations Statistics Division, in collaboration with UN Environment TEEB office and the secretariat of the Convention on Biological Diversity (CBD).

The Social Statistics Division (SSD) of Central Statistics Office of Ministry of Statistics and Programme Implementation (MoSPI) is the nodal agency for implementation of the project in India. The role of MoSPI is to coordinate with all the stakeholders through a consultative process to evolve a model which can help in “Natural Capital Accounting and Valuation of Ecosystem Services” by building upon the various datasets generated through surveys, studies, remote sensing as also through the administrative mechanisms.

India's natural capital

India is home to two of the world's most significant biodiversity hotspots - the Western Ghats and the Eastern Himalayas - and the nation ranks as one of the most biodiverse countries in the world.
India has had strong economic performance growth over the past decade, with growth rates of over 7% between 2005 and 2015. As a result, as many as 270 million people have been lifted out of poverty and the nation’s poverty rate cut in half.

However, practices such as overgrazing, slash and burn agriculture and deforestation for fuel have produced significant strains on many ecosystems that much of the population depends upon for their livelihoods. The Indian government has made a firm commitment to environmental protection as part of its development agenda, with a focus on the interconnections between poverty and environmental degradation, that may be informed by ecosystem accounts.

The SEEA in India

India has been compiling environmental statistics since 1997 when the Central Statistics Office (CSO) released the first issue of the Compendium of Environment Statistics, based on the United Nations Framework for Development of Environment Statistics 1984. Since its inception in 1997, 16 issues of the publication have been released, presenting data relating to the environment of the country.

Work on environmental economic accounting began in 2011, when a high level Expert Group under the Chairmanship of Prof. Sir Partha Dasgupta, U.K. was constituted by the Ministry of Statistics and Programme Implementation (MOSPI) with the mandate of developing a framework for green national accounts of India and preparing a roadmap to implement the framework. The resulting report, “Green National Accounts in India-A Framework”, laid out a roadmap with short-term, medium-term and long-term activities for implementing the Green Accounting Framework.

In September 2018, the CSO released India’s first official environmental economic accounts containing asset accounts in physical terms of four natural resources – forest, land, minerals and water. The accounts revealed a nuanced picture of the state of India’s natural capital, with several regions showing a net-positive increases in assets like forest cover and carbon stock.  However, the accounts also revealed potentially unsustainable trends in groundwater extraction as well as serious declines in snow and glacier cover. The 2018 report can be accessed here

The current issue of EnviStats India 2019 envisages to add condition layers  to the physical accounts based on the quality characteristics, namely,  soil nutrient index and water quality accounts in respect of surface, ground and sea water. In addition, to help understand the contribution of ecosystem services to the economy, values of two ecosystem services have been compiled for all the States of the country – cropland ecosystem services and nature-based tourism. 

The 2019 EnviStats report can be accessed here.  

Project goals and activities

The project’s main objective in the partner countries is to mainstream natural capital accounting and valuation of ecosystem services in data-driven decision and policymaking and is expected to influence policy-makers at the national, regional and local level.
Project activities in India include the development of pilot ecosystem accounts. This will include experiments at different scales with different types of accounts:  

  1. At the national level, several ecosystem services will be modeled in physical and monetary terms, including nature-based recreation and crops provisioning service. Also, the feasibility of compiling a biodiversity accounts will be examined.
  2. At the national level soil accounts (an important element of ecosystem condition) will be developed applying the S-World model.
  3. In the State of Karnataka, a whole suite of ecosystem accounts will be developed in physical and monetary terms. These accounts will also be applied in scenario analysis.  

The state of Karnataka has been identified in a landscape assessment due to:

  1. good data availability and presence of existing studies;
  2. strong technical capacity within local research institutes on spatially explicit mapping and the valuation of a range of ecosystem services at the local scale; and
  3. policy interest in using an accounting approach for informing a range of policies.

The initial policy areas which the ecosystem accounts could inform included watershed management programmes and ago-forestry schemes. The key ecosystem services at Karnataka-State level to initially focus on in the piloting of ecosystem accounts identified include: food provisioning; materials / timber provisioning; fresh water; carbon sequestration; local climate and air quality; pollination; soil fertility; and tourism.

The experiences learned through the piloting will provide important inputs into the development of guidelines and standardisation of methods through the revision process of the SEEA EEA.
In parallel to the piloting, India will also contribute to other workstreams of the project such as the testing of indicators that are derived through the accounts, and the workstream on alignment with sustainability reporting in the private sector. A national communication and outreach strategy to raise awareness and value added of NCA in India will also be implemented.

Contact details

Additional Director General
Social Statistics Division,
Central Statistics Office,
Ministry of Statistics and Programme Implementation
West Block-8, Wing-6 (Ground Floor), 
R. K. Puram, New Delhi-110066