India’s CAG writes, Blueprint for a blue economy (GS Paper 3, Economy)
Context:
- The Comptroller & Auditor General of India (CAG) will chair SAI20, the Engagement Group for Supreme Audit Institutions (SAls) of G20 countries in Goa in June.
- For SAI20, the CAG is to prepare technology-driven tools to assess authorised development in coastal stretches and track marine water quality.
Theme of G20 2023:
- Under the Indian presidency, G20 leaders will address urgent policy needs for collective progress, equity and inclusive growth when they meet in New Delhi in 2023.
- With the summit theme of “One Earth, One Family, One Future”, India has set the tone and perspective for commitment to green development, circular economy and lifestyle behaviour changes as an actionable plan for achieving the 2030 Sustainable Development Goals.
- A slew of events will also be held across the country to focus on solutions to a wide range of issues from climate finance and technology sharing to financial inclusion and digital public infrastructure.
SAI20:
- Two priority areas have been selected for SAI20 deliberations; blue economy and responsible Artificial Intelligence.
- SAI20 member countries are being engaged in a collaborative exercise to evolve globally relevant audit toolkits along with a compendium of case studies and challenges in the broader framework of auditing coastal spaces, which, inter-alia, include legal and institutional frameworks, compliance to coastal regulation, biodiversity conservation, capacity building and compliance to SDGs.
Focus on blue economy:
- In 2018, the United Nations Environment Programme (UNEP) had for the first time laid out the Sustainable Blue Economy Finance Principles, a framework investors can use to fund ocean-based industries. Financiers can use it as a reference point to see how marine investment can impact livelihood and poverty eradication.
Biodiversity framework of COP15:
- The four goals and 23 targets set out in the global biodiversity framework of COP15 aim to conserve and sustainably use the planet’s biodiversity.
- These objectives focus on topics such as reducing the rate of loss of biodiversity, ensuring the fair and equitable sharing of benefits arising from the use of genetic resources, and restoring degraded ecosystems.
- The framework aims to strengthen cooperation and coordination among countries and stakeholders to effectively conserve biodiversity and promote its sustainable use.
- The biodiversity framework of COP15 serves as a blueprint for countries to work together and make progress in addressing the global biodiversity crisis.
New accounting framework:
- The blue economy encompasses an array of coastal activities, including fishing and tourism. The measurement of the blue economy is challenging due to conflicting definitions and issues while classifying different sectors and sub-sectors.
- Existing international economic classifications are unable to properly differentiate between land-based and ocean-based activities, and even the System of National Accounts (NAS) does not provide a clear understanding of the blue economy.
- Given these difficulties, a new accounting framework is needed that can objectively identify production, trade, and services related to the various segments of the blue economy.
Priority of CAG:
- As a public audit authority, the CAG values independence, accountability and transparency — ideals that shall remain the hallmark of SAI20.
- In 2022, the CAG released the first-ever country-wide Compendium of Asset Accounts of Natural Resources, prepared in line with the UN system of Environmental and Economic Accounts.
- One of the few exhaustive natural resource accounting methodologies anywhere in the world, the handbook is a guide for the government to utilise natural resources optimally.
- Setting compliance standards and a national accounting framework for the blue economy is a long-term priority for the CAG.
Conservation of Coastal Ecosystem:
- India has marked the blue economy as one of the 10 core sectors for national growth and a National Blue Economy Policy that aims to harness maritime resources while preserving the country’s rich marine biodiversity has been prepared by the Ministry of Earth Sciences.
- In August 2022, the CAG tabled its Conservation of Coastal Ecosystem report in Parliament, which contained its observations on how the Coastal Regulation Zone (CRZ) notification for 2011 and 2019 have been implemented between 2015 and 2019.
- It looked at the underlining efficiency of development drivers such as project clearances, construction activity, institutional capacity to curb land and forest violations, community livelihood support mechanisms, as well as mitigation management plans to conserve biodiversities such as mangroves and near-shore coral reefs that protect us from weather vulnerabilities like storms and coastal floods. The audit resulted in focused recommendations to help improve the CRZ ecosystem.
Risk for coastal ecosystem:
- Sea-level rise, water temperature, storm surges and wave conditions are some of the signs of climate change. In the context of India, studies indicate that hazards of cyclones and sea-level rise are likely to be higher in the coastal regions.
- According to one study, GIS maps from the European Space Agency indicate that 15 per cent of India’s coastal areas have witnessed changes between 1992 and 2018 due to agriculture, depleting forest cover and urbanisation.
- Besides that, the population living along the country’s coastal areas is expected to rise from 64 million in 2000 to 216 million by 2060.
Disaster-resilient infrastructure:
- Disaster-resilient infrastructure along coasts that can withstand the impacts of hurricanes, typhoons, and tsunamis is the need of the hour. This is particularly important for coastal communities that are vulnerable to the effects of sea-level rise and increasingly intense storm events.
- The executives should be adequately equipped with infrastructure, especially ICT hubs in place for early warning systems.
- The development of disaster-resilient infrastructure has implications for the auditing community, as auditors are responsible for ensuring that organisations comply with relevant regulations and standards.
Way Forward:
- The toolkits being prepared by SAI20 under the leadership of the CAG of India will be presented at the SAI20 Engagement Group meet. This will provide a unique opportunity for constructive dialogue and agreement to improve auditing of performance in specific areas of ocean-based activities.
- This collaborative effort would not only build capacity of auditors across SAI20 member countries initially but would also help regional auditing communities such as ASOSAI and AFROSAI by providing a common and replicable auditing tool.
- This will help in the assessment of how clearly the policy goals are planned and implemented, and how resource efficiency is maintained while leveraging economic opportunities towards a truly sustainable blue economy-based global development model.
