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Number of Downlaods: 37

Published Date: Mar 31, 1998

Environmental Evaluation and Accounting:The Case of Pakistan’s Forests (W-29)

Yorrick Da Silva, Mozaffar Qizilbash, SDPI


There have been different ways of reacting to the possibility that the growth of per capita GNP can conflict with the conservation of the environment. One leading response, associated with the economist David Pearce amongst others,  involves arguing that GNP does not, as it stands, measure the well-being of present and future members of society. This response suggests that if GNP is adjusted so that it reflects the “sustainable income” or “sustainable well-being” of society, there is no necessary conflict between income growth and the conservation of the environment. Indeed, if countries adopt such measures of income or well-being, and aim to maximise these, their development will, it is suggested, be sustainable. An important distinctive feature of the idea of  sustainable development , certainly as it was formulated by the World Commission on Environment and Development (1987) was this assumption that growth of income was compatible with the conservation of the environment.

The challenge to those who adopt this approach is to find ways of measuring the value of the environment, certainly inasmuch as it matters for human well-being. Furthermore, for those who wish to adjust the national income accounts to incorporate environmental concerns the need is to reduce this valuation exercise into some hard monetary figures. This is difficult since much of what we value in the environment is hard to express in monetary terms. Furthermore, environmental resources are often not bought and sold on the market, and market prices have typically been used in the national accounts. Nonetheless, the valuation of environmental resources is the key challenge for those involved in environmental evaluation and accounting.

The pursuit of such exercises can clearly be questioned on methodological grounds. However, there is a strong policy-oriented argument for pursuing them. Inasmuch as GNP per capita is the figure that most policy makers focus on, it is here that the focus of environmental critiques must be concentrated. If unadjusted and adjusted GNP show divergent time paths this is a serious cause for concern, and should have an impact on policy formulation.

In this report our concern is with attempts to apply these methods in the case of the forests in Pakistan. In section 1, we present a critical review of certain dominant techniques used to value environmental resources. In section 2, we present a similar review of the related literature on environmentally adjusted,  green  national accounts. In section 3, we run through some of the reasons why the forests are valuable. In section 4, we describe the situation as regards the forests in Pakistan today. In section 5, we discuss attempts to use some of the methods of environmental valuation and accounting described in earlier sections to evaluate the cost of deforestation in Pakistan and of environmental degradation, as well as other proposals involving forest accounting, and policies for sustainable forest management. Section 6 concludes.