Preservation and protection of the natural environment has never been a priority in our annual Budgets; ALL Finance Ministers have taken it for granted and have treated it as an infinite resource rather than a living entity to be nurtured and carefully harvested on a sustainable basis. In July 2014 I had written a blog on these pages about precisely this: Budget 2014- Shortchanging the Environment. Eleven years down the line this catastrophic deficiency in planning persists, even though a new, and compelling, dimension has been added now with the acceleration of Climate Change (CC). The need now is, not only to provide public funding for measures to counter CC (adaptation, mitigation) but also for rehabilitation of those directly affected by it- poor farmers, landless labourers, fishermen, nomadic tribes. Unfortunately (and predictably) this Budget, like its predecessors, does none of this.
We should perhaps have expected this from the tone of the Economic Survey 2026, released a couple of weeks earlier. In it, the Chief Economic Advisor blatantly bats for growth and neoliberalism at the cost of the environment. Defying all science he states that cutting carbon emissions should not be our top priority, and that “a 3*Celsius world would be a liveable one”(!) Confounding all evidence and scientific global consensus, he goes on to maintain that “growth and prosperity strengthen resilience and reduce vulnerability..” Yes, sir, they do, but only if done in a sustainable and ecologically friendly manner, which is not how it is happening in India. Maybe, if the Economic Advisor had paid more attention to what a fellow economist (without any political bias), Gita Gopinath, had said in Davos, he would have better understood the problem, and how wrong he is.
This govt. suffers from a severe case of CID (Compulsive Infrastructure Disorder); Capex is fine and needed for growth, but so is the environment. There are huge environmental costs to rapid infrastructural expansion- both the World Bank and the IMF estimate this at between 3.5%-5% of our GDP, which comes to about USD 200 billion or 180000 crore rupees.
The 2026-27 budget proudly mentions the creation of a mineral corridor (for rare earths) in four southern states, three more high-speed rail corridors, zero duties for maritime catches in India’s EEZ or the high seas, tax exemptions for setting up data centers, but there is no mention of how the environmental consequences of these initiatives shall be addressed or mitigation of them funded. Are these corridors necessary at all, given the large number of expressways being built all over the country? The corridors shall lead to large scale land acquisition and displacement of populations, adding to the 60 million project refugees already created since Independence. Hundreds of thousands of trees (and mangroves, since rare earths are found in large quantities in coastal areas) shall be felled. The boost to maritime fisheries is welcome, but where are the guard rails to ensure that the livelihoods of traditional fishermen will be protected and not replaced by mechanised trawlers or that measures shall be taken to curb overfishing? The data centers require humongous quantities of power and water- where will they come from in this water stressed country?
The damage to the environment by the various corridors will be enormous, as pointed out above. The dilution of the regulations that could have checked this, or compensated for it, such as the Forest Conservation Act, the Environmental Protection Act, the Wildlife Protection Act, and the defenestration of the regulatory institutions have so weakened these checks over the years that we can expect minimum oversight or safeguards in the execution of these projects.