Govt Should Stop Subsidy on Kerosene !!

An interview with Director General, TERI, RK Pachauri.
Published in Business Standard, February 5th, 2012

From having high profile visitors like Prime Minister Manmohan Singh and Arnold Schwarzenegger, corporates and institutions such as Asian Development Bank, the three-day sustainability summit organised by The Energy and Resources Institute (Teri), witnessed debate on an array of issues. Director General R K Pachauri, who was busy brainstorming with foreign delegates, spoke to Piyali Mandal on the key takeaways from the event. Edited excerpts:

The summit is happening ahead of the Union Budget. During the summit, the issue of financing green projects was discussed. What are the demands you will place before the finance minister?
One area would be energy access. It is irrational to have a subsidy on kerosene when we know that almost half of that kerosene actually goes into adulterating other petroleum products. Today, we have a solar lantern and a solution which is sustainable, clean and healthy. If they have to provide subsidy, they can provide it to a solar lantern or at least stop subsidising kerosene.

Just a day ahead of the sustainability event, you had the Global CEO’s summit. What feedback did you get?
Corporates have two sets of concern; one is clear assurance on the continuation of policy. They would like to see the government announces a policy and does not change it overnight. After all, they have to make investment and carry out research and development, which becomes relevant if there is continuity of policy. The second aspect relates to opportunities that businesses find. In the whole area of protecting the global commons and persuading a path of sustainable development, businesses see huge opportunity. These markets are going to grow in the future; whether you take renewable energy or clean technologies. Those businesses that would take note of this and start investing would be the one that come out as winners.

What was the key message from the summit?
In all our economic activities we need to identify and estimate private costs and benefits versus social costs and benefits because as long as there is going to be a large diversity between these two sets of costs and benefits, you will have either under exploitation or over-exploitation of natural resources.

Our pricing schemes and policies will have to be devised in such a way that we ensure the wealth that nature has provided us does not deplete or diminish. Otherwise, it won't be sustainable. The impact of climate change issues is becoming progressively serious. As an integrating factor, one could look at the concept of sustainable development goal, coming up with green pattern of economic development; these are sort of the fall-outs of some of the issues that have been discussed here.

What is the road ahead?
We will prepare a document, which will be a statement of the secretariat of the summit and send it to the official Rio+20 process. We will also submit it to the government of India.