Environmental and sustainable development – International environmental policy

PROJECT REPORT OF MR. Jobby Thadikkaran In Part fulfillment of the requirements for the Summer internship In Economic policy Project On Environmental and sustainable development – International environmental policy Under the Guidance of Mukesh Kumar Mishra Secretary General Krityanand UNESCO club Jamshedpur.

By

LOGO OF YOUR INSTITUTE OR UNIVERSITY Jobby Thadikkaran Ambedkar University Delhi- BA economics honors On 20/07/2017

'Man is the only animal that makes bargains; one dog does not change bones with another dog'- Adam Smith

Overview In this paper, both the indicated perspective of International Environmental policy as well as possible alternatives is discussed from a theoretical point of view. One can hardly predict how the theoretical proposals will materialize in practice after passing the negotiation process. Environmental policy has been a huge concern in recent years not as a part in regulating a law but ensuring each individual firm or industry is abiding to the decree established by the government. My research set forth layman literacy in the field of Environmental policy and its various virtues imparting necessary details from different countries. The discussion on this paper is solely based on theoretical arguments justified by the conventional interrogation of various articles and essays. We shall look into detailed tools for environmental policy used by the government and indulge into more comprehensive knowledge on Aarhus convention and Paris agreement.

Introduction From industrial miasma of greenhouse gases to ruthless angered political march. The environment has suffered alot, and to promulgate the effect the sceptic embarks on the idealism put forth on environmental development. Our environment is the superior system that can be huge burden to our human race if we try to surpass it. Growing urbanization, industrialisation, over population and deforestation behemoth are some of the main concern for the environmental degradation. In 1960 when environment revolution arrived in U.S most of the economist predicted the swift and pervasive deterioration of our environmental assets ahead. Since then it has reported that, each year 55 billion tons of bio mass is extracted from the face of the earth in generation of fossil energy, metals and minerals. It is also reported that by the end of 2020 extraction will increase to staggering 50%. From my perspective these numbers are more than enough to get the idea in what rate we are draining our planet earth. In today’s practise the only notion that can achieve perseverance for posterity is sustainable development.

The key concept of sustainable development contains environmental, social and economic dimensions; finding practical ways to balance the three is widely regarded as a key challenge.

Sustainability emerged in the Mid-20th century as a fairly straightforward notion in the management of renewable natural resources such as forest and fisheries. In this narrower context the term simply meant extracting from a resource stock at a rate below the stocks

natural growth rate. In the 1980s however the term began to be used in border context. A redefining moment came when in 1987 world commission on environment and development (also known as brutland commission) popularised the term sustainability development which is defined as ¨development that meets the needs of the future generations to present without compromising the ability of future generation to meet their own need¨.(WCED, 1987) Today the term has become ubiquitous. People are talking about sustainable health, livelihood, communities, transport, cities and even defence. The word ¨environmental¨ quite often tends to be associated as subset of the broader concept called “ecological,” i.e. the intersection of human activities and ecological systems. The notion of sustainability becomes much more complicated when we transfer it to higher level. In common practise ¨to sustain¨ is simply to maintain undiminished over time. In this elementary sense, it is not clear that sustainability is always desirable goal or attributes social structure. It emerged from environmental context and therefore they refer to maintain undiminished ecological basis of human well being.

Achieving sustainable development internationally; requires partnerships among various countries, along with environmental initiatives by developed countries and appropriate contributions by developing countries.

Over a period of time we face severe challenges towards our future generation. Our increasing population have been so demeaned to the existence of biosphere (including oceans, forests, atmosphere, soil cover and a large number of animal and plant species) that the main question that embarks this journey on environmental and sustainable development is that why one should be concerned about sustaining ecological basis of human being and even if they do so; how can sustainability be implemented in wider context?

Current issues in advancing sustainable development includes securing good governance at national and local levels; strengthening partnerships between governments and between governments and other entities; expanding corporate social responsibility; as well as minimizing the adverse effects of globalization and narrowing the gap between rich and poor.

Other than this the rate of depletion of soil fertility, groundwater resources, increasing river pollution and plunge in greenhouse gases in atmosphere are all phenomena for destruction of biophysical resources and disruption of ecosystem on which human well-being seems to critically be dependent. Human being have always been naturally concerned about their own future and all human cultures often place a significant value on the well being of future generation. But these recent evidences play a strict irreversible role in deprivation of earth resources. Development depends on a healthy environment, and sustainable development

requires conservation of local environment, including air, water, and soil. Satisfying basic needs includes eliminating hunger, providing primary education, and improving health are some which are crucial to sustainable development.

With increase amount of international law, it raises questions of governmental conduct with mishap of claiming territory, using force against other states, suppressing human rights, exercising jurisdiction, and so forth. Due to which environmental problems are also linked with the product of governmental conducts for example, the blast of Kuwaiti oil wells by Iraq during the first Gulf War. Yet most pollution and natural resource depletion result from private activities. Consider climate change, for example. Emissions of carbon dioxide and other ‘greenhouse gases’ result from generating and consuming electricity, driving cars, manufacturing products, growing food, and cutting trees—activities that qualify as private rather than governmental. The same is true of other international environmental problems as well; oil pollution results from the combined actions (or inactions) of oil producers, shipbuilders, shippers, and, ultimately, individuals who consume oil for transportation and other purposes; deforestation results from demand by local populations for fuel wood and for agricultural land, and by local and more distant populations for timber. Virtually all human activity are interconnected to one degree or another, the consumption of resources or the generation of wastes and, thus contributes to environmental problems.

In 1992 first united nation conference on environment and development was held in Rio de Janeiro in lieu to urgency for environmental protection and socio economic development known as Agenda 21.Nonetheless, the 1990s did not achieve tangible outcomes of sustainable development in developing countries. In light of this rethinking, the United Nations Millennium Summit was held in 2000 focusing on issues such as peace and safety, development and poverty, the environment, human rights, and good governance. The Summit established numerical targets for nations to achieve by 2015 (Millennium Development Goals, or MDGs), and an international agreement was reached on how to achieve MDGs. Later On 25 September 2015, 193 member of united nation general assembly adopted sustainable development Goals that targeted better future for 2030 sustainable Development targeting 17 goals and 169 targets.

1. Reduce poverty 2. Zero hunger 3. Good health and wellbeing 4. Quality education

5. Gender equality 6. Clean water and sanitation 7. Affordable and clean energy 8. Decent work and economic growth 9. Industry and Innovation and infrastructure 10. Reduced Inequalities 11. Sustainable cities and communities 12. Responsible consumption and production 13. Climate action 14. Life below water 15. Life on land 16. Peace justice and strong Institutions 17. Partnership of goals

These 17 goals are build on the success of millennium development goals while including new areas like climate change , economics inequality, innovation, sustainable consumption, peace and justice on priorities. These goals are interconnected and often an issue to tackle more commonly. They provide clear guidelines and targets for all countries to adopt in accordance with their own priorities and environmental challenges of the world. These goals have major impact on the issue much greater than just saving the ecosystem. The agenda takes the effect to notify the purpose of humanity and its efficient volume for the betterment of our future. These agenda may sets forth different aspect to human society but the effectiveness is taken care by the individual country who have promised to abide by the policy and infrastructure to reach to these development goals. Each country proposed different policies which also included hefty political involvement. These policies takes a desired steps onto the survival of eco friendly as well as help in attaining efficient parameters for our posterity happiness.

Research Objective This research paper includes core curriculum in context to Sustainability development and the scope of actual acknowledgment for International environmental policy. My research partakes in the situation of free public participation in environmental decision and highlights the current agreement by UNCED. In June 1992, the United Nations Conference on Environment and Development (UNCED) held in Brazil adopted the “Agenda 21” action plan based on the concept of sustainable development, Followed by UN Framework Convention on Climate Change (UNFCCC). And on 2002 September, the United Nations World Summit on Sustainable Development (WSSD), was held in Johannesburg, wherein the Summit stressed the need for various related entities - governments, international organizations, corporations and NGOs to cooperate. My whole intent in this paper would to give reader a simple yet comprehensive knowledge on various factor of environmental policy and its reforms.

This research agenda culminate the recent article on Paris agreement and later offset to the Aarhus convention in regarding public awareness and participation. This paper scrutinizes the facts on environmental policy globally and how it is been implemented by the industries or the firm.

We will look at more careful explanation of environmental policy implemented in Europe, US and Asia.

Environmental policy: Origin and development: In 1972 when United Nation addressed Environmental policy for the first time, the reported scale of pollution was extremely unrealistic. According to UN report it stated that most of the country’s ozone layer was depleted due to expansion in industrial sector. In this Industrialist world people were mainly exposed to toxic substances in unambiguously harmful doses.

Environmental policies were a core component for organizations to regulate and commit on law, regulations and other policy reforms, referring to ecological issues. These included air pollution, water pollution, waste management, ecosystem management, and expansion of biodiversity, protection of flora and fauna and endangered species.

These policies were the core foundation to many new reforms and changes for our environment. On contrary the united nations report referred as U-Thant report under principal 11 stated that: ¨The environmental policies of all States should enhance and not adversely

affect the present or future development potential of developing countries, nor should they hamper the attainment of better living conditions for all, and ………..¨[United Nations 1972] Our environment policy changes over a period of time as per the change required in the environmental issue; like in the 1960s the environmental problems including the release of air and water pollutants like sulphur dioxide, dissolved solids in water, smog, and acid rain were all added in the policy making decision. Moreover the aim to balance environmental protection and conserving the natural resources with affordable energy as well as economic growth and employment was set as a primary code.

Environmental Policies are set in accordance to the relative need in current atmosphere, for example a factory that must discharge wastewater as part of its daily operations may need to hold and maintain a federal permit. The factory would be required to follow a set of rules and requirements within its permit to comply with environmental laws. Federal and state environmental rules cover air quality, water quality, waste management, land conservation, chemical and oil spills, and drinking water quality.

On contrary, looking at the above examples we could also predict that the environmental policy can be massive success if implemented right way by the government and industry as well.

The environmental policy is guidance to protect the actual problem faced by the global greenhouse gasses. In the reference with UNCED known as Earth summit, acclaimed that they aim to stabilize greenhouse gasses which in turn could prevent interference with climatic change. Various factors such as political, economic, environmental and cultural factors also play very important roles in shaping policies to solve the environmental problems. Suitable policies and implementation, rules and evaluation criteria as well as the participation of the whole society, contributes to the process of sustainable development.

Before we move ahead on discussing various tools on environmental policy let’s review some of the environment treaty established for the environment by the Government.

Literature Review • Aarhus Convention: Aarhus convention was the first step towards the propaganda for public intervention towards public information and participation in decision making on Environmental agenda. On June 25 1998, Aarhus convention was signed as a decree by the UNECE convention in the city of Aarhus, Denmark with concentration of rights to Access to Information, public participation

in decision making and access to justice in environmental matters, which often concerned with the local, national and transboundary environment. It focuses interactions of public and public authorities. This Convention holds government accountability, transparency and responsiveness.

Aarhus conventions coordinated the links between environmental rights and human rights and debates on sustainable development that can only be achieved with active participation of the stakeholder. This convention holds the basic necessity of this research paper, as it allows setting certain obligation to future generation by the current people itself. It inculcates the sustainable development as a collective part. At the time of convention the treaty hosted to establish three ¨pillars¨ to the convention providing public rights in terms of access to information, public participation and access to justice.

When the convention proclaimed the right to public information as part of the agenda the issue spread how public can participate in the decision making. This is where genetically modified organisation (GMOs) played role in allowing public concern to participate for information in decision making. The 'public concerned' is defined as 'the public affected or likely to be affected by, or having an interest in the environmental decision-making', moreover it explicitly includes NGOs promoting environmental protection. Public participation is different and broad on environmental assessment. For example, the Cartagena Protocol on Bio safety requires Parties to provide access to information on living modified organisms identified in accordance with the Protocol that may be imported.

The assessment validates that public is also part of the initiative in protecting our environment.

At the time of implementing the agenda, the convention has faced various step-backs but the main stepping stone was accepting ECE guidelines that paved the path on access to environmental information and public participation in environmental decision.

Coming back to the first ¨pillar¨, Access to information is divided into two parts passive and active. ¨Passive¨ where one can approach by specific request for information and it is obliged by public authority to provide the necessary information and ¨active¨ where the public authority provided information with no specific request but the information is spread for all.

The third ¨pillar¨ Access to justice articulate the working of both accesses to information and public participation in decision making that are bided with law of the environment. The access to justice pillar also provides tools for the public to enforce environmental law directly.

The contrasting effect of this convention was the withdrawal in the field of discrimination on the basis of citizenship, nationality or domicile against persons seeking to exercise their rights under the Convention. They address more of public body than the privatised bodies and top of that all the judicial or legislative bodies were excluded.

When we as human being talk about environment protection and justice, there is always a conundrum in our conventional mind how can we achieve it. Many of our neighbouring citizens might not be aware of proper techniques to save the environment, this convention stands the way to utilise every helping people hands in the decision regarding protecting the environment.

The parties, who have accepted by the law, have set up certain standard by the convention but the convention does not prevent any party from adopting any measures on providing information to public and access to justice. And on March 2017, 31 parties ratified on for the access to decision making. The Convention entered into force by 30 October 2001.

So as the years in the conventions passes away, we could witness various success in its field like the successful completion of the Aarhus convention effect was seen on various protocol like the Protocol on Water and Health (London, 1999) to the ECE Water Convention was the first international instrument to take the provisions of the Aarhus Convention into account.

Later years a Pollutant Release and Transfer Register (PRTR) was launched aiming to facilitate public access to information through the establishment of coherent, integrated PRTRs, and in order to facilitate public participation in environmental decision making and contribute to the prevention and reduction of environmental pollution. Protocol was the first legally binding international instrument on pollutant release and transfer registers. Its objective is "to enhance public access to information through the establishment of coherent, nationwide pollutant release and transfer registers (PRTRs)." PRTRs are inventories of pollution from industrial sites and other sources. This Protocol entered into force on 8 October 2009.

• Paris Agreement: Paris agreement is the successor of Kyoto Protocol that was initiated under United Nations Framework Convention on Climate Change (UNFCCC). Paris agreement is the bliss point for global impact on climate change. It mainly focused on the agreement that could strengthen the global temperature to below 2 degrees Celsius above pre industrial level and limit the temperature even further to 1.5 degree Celsius. Although they were focusing on limiting

climate change it was also helping amassed country to fight climate change in their own accord.

Though to achieve these two long term goals, a mechanism was agreed upon whereby from 2020 onwards every five years, all countries will present their strategies for reducing greenhouse gas emissions. Five years is short enough to ensure governments will act as often they are caught by short-term solutions coinciding with elections cycles. Language in the agreement allows developing countries to continue increasing their emissions but at a lower level than ‘business-as-usual’, depending also on the support they will receive from rich countries.

Unlike its predecessor, the Kyoto Protocol, which sets commitment targets that have legal force, the Paris Agreement, emphasis on consensus-building, allowing for voluntary and nationally determined targets.

For some might be pondering onto the idea of Kyoto protocol; how it was emerged and what role did it play? In the late 1997, when Kyoto protocol was launched by the third conference of the parties by the UNFCCC in Kyoto Japan, It was held as the first step toward global emission reduction that stabilizes the green house gas emission. Its main objective was to laminate on the objective for 37 industrialized countries and European community to reduce the emission by an average of 5.2% compared to 1990 levels by the first commitment period of 2008 to 2012. And during the second commitment period, Parties committed to reduce GHG emissions by at least 18 percent below 1990 levels in the eight-year period from 2013 to 2020.

All these years Kyoto have been a success, and though if we compare it with current Paris agreement we could find contrasting difference between Kyoto protocol and Paris agreement ;firstly Kyoto protocol focused on to reduce the use of fossil fuels and stop deforestation, while Paris Agreement is primarily focused on switching to renewable energy. Secondly, the goal of Kyoto Protocol was to reduce the carbon emissions by some extent, whereas that of Paris Agreement is to limit the temperature rise to two degree Celsius from pre-industrial levels.

From the ¨Ad Hoc working group on the Durban platform for Enhanced action¨ to ¨Ad Hoc Working Group on the Paris Agreement¨ (APA).Does Paris agreement have a very tight road ahead?

By the end of 27 April 2016 Paris agreement condemned with 177 signatories, Where Small Island like Marshall Islands, Barbados, Fiji, Tuvalu and Mauritius which where the most threatened by the impact of climate change has accepted for ratification in total 0.03% of

global greenhouse gas emission(GHG).Shaping of NDCs (nationally determined contributions) for each country in reducing the intended emission; the APA holds accountable for each country to perform as pledged under NDCs with consistent guidelines.

Financing Climatic action required contribution of around $100 billion from developed country to developing country to enhance and adapt the climate change.

Many countries like Saudi Arabia, Iraq, Nigeria, Kazakhstan, Uzbekistan and Turkmenistan, whose economies are likely to take a substantial hit because of a faster shift to renewable energies dictated by climate change did not showed up for the agreement.

And to that U.S under the administration of president Donald Trump chose to withdrew from Paris agreement was totally shocking ,by announcing a statement that it is a complete flawed and they are spending U.S fund to other developing countries by the president itself.

U.S and China together account for 45% of world carbon dioxide emissions. The US's plan, which the Obama administration submitted in March 2015, set the goal of reducing greenhouse gas emissions by 26% to 28% by 2025. The baseline level this reduction is measured against is 2005, when the US emitted the equivalent of 6,132 million metric tons of carbon dioxide.

Whereas china has been great equivalence to Paris agreement as the general trend of green, low-carbon and sustainable development advocated by the Paris Agreement coincides with China's policy of promoting ecological advancement. However the other countries may change, China will continue to pursue innovative, coordinated, green, open and shared development, bear in mind its domestic requirements for sustainable growth, step up concrete efforts to deal with climate change and faithfully implement the Paris Agreement As these two countries turned out to be pessimist about the Paris agreement we could simply understand the optimism by the rest of the countries that have put their best effort to abide by the decree. Surely it will take time to adapt to new changes but the adaptation section is perhaps one of the best outcomes which will be the creation of a qualitative goal to review the actions undertaken and the needs of improving resilience of the poorest and most vulnerable countries, in combination with the 5-year mitigation cycle.

This agreement acknowledges the strong link to mitigation action as the main solution to reduce the need to adapt to climate change. Several fundamental rights are also explicitly mentioned in order to ensure adaptation actions are shaped to the specificities of each

country, to be gender-responsive and to take into consideration vulnerable and indigenous communities.

Finally the agreement has a section on financial, technical and capacity-building support and cooperation which includes a 2-year cycle to verify if pledges and commitments are fulfilled.

As financial support is often directed to mitigation projects, the agreement corrects this asymmetry by ensuring support being provided in a balanced manner between mitigation and adaptation. Moreover adaptation finance should be public and grant-based, and the contribution of rich countries should be scaled-up over time.

Instruments for the Environmental Policy: Environmental policy has been the paradigm in providing better scheme in ensuring safety of sustainable resources as well as the environmental protection. These schemes are often implemented by the government on various factors like reduction in emission of co2 or decrease in disposable waste to water. So to initiate such schemes there are several instruments that can be applied, however the growing interest and the use of the different types of the policy instruments driven by several phenomena and the most common is traditional ¨command and control¨. However this often termed as old traditional method, wherein the method is utilised in form to full access control over the industry by the government for a very long time. But there are new method that has been introduced in lieu to the regime of old tradition method; where most of the economist were sceptic about, which can be referred as market based approach and voluntary approach. Before we define the contrasting difference between old and new tradition, first let’s look at why policy instruments is so important to implement while providing the scheme.

One of the reasons which have been predicted by many environmental scientists for policy failure or market failures is due to improper diligence of policy instruments. And to which externality plays impediment while rifling the way to secure environmental degradation by the policy maker.

In the book by Baumol Oates- Theory of Environmental Policy, he states that with the increasing population economist have faced much discrepancy in the making policy decision effectively. He also debates that externality played a vital role in establishing environmental decision making. His strategy to adopt the idea of Pareto optimality is by not compensating or levying the tax on the victim or anyone, instead argues that taxing the victim may shift the externality onto someone else or some other thing which can lead to begin a chain like

substances. In order to avoid this scenario Baumol advice the idea of tradition method ¨the command and control¨ on policy decision making. In general, command-and-control regulations tend to force firms to shoulder similar shares of the pollution-control burden, regardless of the relative costs to them of this burden. Command-and-control regulations do this by setting uniform standards for firms, the most prevalent of which are technology-based and performance-based standards. For example, a regulation might limit the number of allowable units of a pollutant released in a given time period, but might not dictate the means by which this is achieved.

Taking a piece from the context of Baumol oats, I would like to indulge your reading of this paper in much more detailed manner. The tools I am going to discuss below are going to be academically efficient and fragmented into different area. It will be much efficient to understand government methods in cooperating policy making and implying the same.

The environmental policy can be touched with the matching issue that the environment faces.

Policies differ with respect to the different areas to which it needs to be applied.

Following below would be some comparison on different tools or instrument used to make policy decision:

• Market based approach: For almost a decade, government have intervened the global environmental policy decision making with the help of old traditional method known as ¨command and control method¨.

Command and control was pretty simple but not upto the mark method. Here the performance was set as a uniform control mechanism for various industries, wherein it provided some guidelines to how this mechanism is to be met. For example, a regulation might limit the number of allowable units of a pollutant released in a given time period, but might not dictate the means by which this is achieved.

Much environmental pollution and natural resource depletion comes from incorrect pricing of the goods and services we produce and consume. 'Market based instruments' (MBIs) such as taxes, charges, subsidies and tradable permits help to realise.

When we talk about market based approach, we could see stretched difference between command and control and market based approach. If we define Market-based instruments, they are the regulations that encouraged behaviour through market signals rather than explicit directives regarding pollution control levels or methods. Market based approach was much

cost effective and hold a major incentives for technology innovation. There are huge differences when we see a in-depth comparison between command and control but to brief it out command and control is cost effective only in theory, however market based approach are cost effective in practical sense. Market based approach are of four types: 1. Pollution charges 2. Tradable permits 3. Market barrier reductions 4. Government subsidy reductions.

Pollution charges: these are systematic assess of fees or tax applicable onto the pollutant or the firm for the amount available. It is sufficient because it will Equalize marginal cost with tax rate and thus restrict firms to control pollution in different degree. There is also special type of pollution charges known as deposit refund system, where consumers pay a surcharge when purchasing potentially polluting products, and receive a refund when returning the product to an approved centre (for recycling or disposal).

Tradable permits: Under a tradable permit system, an allowable overall level of pollution is established and allocated among firms in the form of permits. They can achieve the same cost-minimizing allocation of the control burden as a charge system, while avoiding the problem of uncertain responses by firms. Firms that keep their emission levels below their allotted level may sell their surplus permits to other firms or use them to offset excess emissions in other parts of their facilities. These policy instruments, such as tradable permits or pollution charges, are often described as "harnessing market forces" because if they are well designed and implemented, they encourage firms (and/or individuals) to undertake pollution control efforts that both are in those firms' (or individuals') interests and that collectively meet policy goals Market barrier reductions: In market barrier reduction there is substantial gains achievement that can be made in environmental protection simply by removing existing explicit or implicit barriers to market activity. Three types of market barrier reductions are: (1) Market creation, as with measures that facilitate the voluntary exchange of water rights and thus promote more efficient allocation and use of scarce water supplies

(2) Liability rules that encourage firms to consider the potential environmental damages of their decisions (3)Information programs, such as energy-efficiency product labelling requirements.

Government subsidy reductions: By the term Subsidies itself we could correlate as the mirror image of taxes and, in theory, can provide incentives to address environmental problems.

Market based approach if properly designed and implemented can encourage appropriate environmental behaviour through price signal rather than explicit signals which in return provide incentives to not just to industry for their goals but for environmental goals like waste reductions cleaning of air or water pollution decrease. In practice, however, many subsidies promote economically inefficient and environmentally unsound practices.

If we analyze these market based approaches, we could simply find that pollution taxes and tradable permits are symmetric, but that symmetry begins to break down in actual implementation. Let’s see how we could justify this conundrum; first, permits fix the level of pollution control while fix charges joins the costs of pollution control. Second, in the presence of technological change and without additional government intervention, permits freeze the level of pollution control while pollution charges increases it. Third, with permit systems that are typically adopted, resource transfers are private-to-private, while they are private-to-public with ordinary pollution charges. Fourth, while both charges and permits increase costs on industry and consumers, charge systems tend to make those costs more obvious to both groups. And lastly, permits adjust automatically for inflation, while some types of charges do not.

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emissions from power stations, industry, cars and aircraft (tradable emission permits, fuel taxes);

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increasing waste generation by households and other actors (waste disposal taxes, taxes on packaging, incentives for recycling);

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emissions resulting from houses and offices (incentives for improved insulation and energy efficient heating systems);

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Emissions resulting from agricultural activities (fertiliser and pesticide taxes).

The levels at which 'prices' are set reflect both an incentive to producers and consumers to change behaviour and a realistic analysis

Coming to the decent of the market based approach, generally legislative always have used market based approach as direct plan that infuses flexibility in the government. That whys implementing market based approach is hassle; although most of the countries have started using market based approach. In contrast to command-and-control regulations, market-based instruments have the potential to provide powerful incentives for companies to adopt cheaper and better pollution-control technologies. This is because with market-based instruments, particularly emission taxes, it always pays firms to clean up a bit more if a sufficiently lowcost method (technology or process) of doing so can be identified and adopted

• Voluntary based approach In the late 1980s, European countries began to take a serious interest in voluntary approaches as a regulation to alternatives as mandatory regulation. These regulation adopted by European Union has been the flagship for the stand of voluntary based approach. Voluntary based approaches symbolises protectionism, responsible and flexibility. By the term ¨voluntary¨ itself defines to partake responsibilities in your hands. Voluntary approach is simple decision where firm set right schemes to improve environmental performance, Voluntary and market based approach both differ in their approchment towards decision making tools. One is based by government but the other is formed by the practitioner. But the objective is same to reduce environmental damages. Moreover Voluntary approach is developed to marginalise the old traditional method command and control on environmental policy, when it comes to flexible way to approach sustainability and eliminate the rising industrial competition.

Just as market based approach voluntary based approach is also divided 4 types; public voluntary programme, negotiated agreement, unilateral agreement and other is private agreement which is commonly between polluter and pollute.

Unilateral agreement: is the environmental agreement made between the firms and communicated between the stakeholders. They are also referred to by the somewhat more descriptive term “industry self-regulation.”

Negotiated agreement: It is contract between the public authority and industry, they are highly targetable and time based.

Public agreement: firms agree to the standard set by the public body such as environmental agency.

Many OCED countries have used voluntary approach method while implementing environmental policy; in much the most famous were in Japan and France both in 1960s and 1970s.In Japan when coal fired power station was opposed by the residence ,the mayor of Yokohama took the initiative to organise independent committee to carry environmental impact assessment. However in France voluntary approach was first approach to environmental policy falling under negotiated agreement between the cement industries which later achieved high standard. As the ordinal set by the industry itself, it has a regulatory gain towards publically set regulations. With industry indicated to provide better tender and control emission was already a big deal in cost minimising With many Policy makers aesthetic believe that additional environmental improvement can only be achieved at the reasonable cost if firms opt proactively while deciding on emission control. It has been seen that voluntary approaches provide rapid action than that traditional method.

Most of the Trade unions and NGOs are active part of voluntary approach. It is tempting to dismiss voluntary agreements as abject failures accepted by regulators who fervently wanted to believe environmental progress was occurring even when public politics prevented substantial government action. But the fact that voluntary approaches were embraced around the world at roughly the same time suggests that something larger was at work. And the fact that they play different roles in different parts of the world, and show varying degrees of success, suggests that they may be more than pure window dressing Voluntary approach can also be mixed with economic instrument, e.g. Swiss negotiated agreements on reduction of co² which is linked with co² tax.

Just like traditional market based approach or the voluntary approach there are more instrument for environmental policy like bilateral agreements or the implementation of greener public purchasing programs.

Europe and its environmental policy: European environmental policy has been the standout at a huge scale in reference to international environmental regulations. Their impacts on deciding environmental policy are conglomerated by both the national and international policy.EU environmental policy started at the event headed by European economic committee in Paris on 1972, debating about the

midlife crisis on trade and economic barriers. And on 1973, legislation passed first environment action programme indicating the protection of environments and sustainable resources. After the EU environmental policy was launched, around 1986 it had created a legal basis in European treaties as well. There was a profound necessity for a common Environmental policy because the environmental pollution did not stop at national borders and in close relation needed to be addressed along with cross-border measurements, moreover the increasing international political realm onto environment created problems on common basis. In the late 1970s and 1980s EU environmental policy was marked by the rapid build-up of a body of legislation that covered a range of issues previously not dealt with at EU level.

On the other hand The European Parliament also played a major role in shaping EU environmental law. During its current term, it was dealing with legislation deriving from the circular economy action plan (on waste, batteries, end-of-life vehicles, land filling), climate change issues (ratification of the Paris Agreement, effort sharing, accounting for land use, land-use change and forestry in the Union’s climate change commitments, ETS reform).

Besides obtaining greater satisfaction in arranging better policy for the environmental asset Several European countries was moved to implement pollution taxes within the framework of ecological or “green tax reform,� which seeks a systematic shift of the tax burden away from labour and/or capital and toward the use of environmental resources.

Just as any environmental policy instrument used by the government to establish core for the environmental policy decision making, Europe was mainly familiarised with market based approach before voluntary approach was even implemented. Around mid 1990s the use of market based instruments in environmental policy has gained substantial ground in the areas of taxes, charges and tradable permits. Although European environment policy worked on various principles, some of them were quite common (polluter pays, action at source), while others are more specific to the broad European ambitions. Besides, Europe excelling in the field of environmental protection it also participated in large multilateral agreements in recent decades for the protection of the ozone layer, biodiversity and climate change. Initially, European environmental policy was rather implicit. However, the Union has embraced a growing leadership role on global environmental governance. With active governance control in the field for climate change, water pollution, waste dumping and other sustainable resources. Prime example was the role of the EU in securing the ratification and entry into force of the Kyoto Protocol in the face of US opposition

Yet while EU is strong at environmental ambition, it is rarely able to exert sufficient influence in the negotiations to get comprehensive measure adopted internationally; its actions are often weakened by internal divisions. Indeed, EU environmental policy is based on shared competence between the EU and the member states. It is thus frequently the case that these states are represented in international negotiations at the same time as the EU, inevitably by the risk of disharmony. One of the reasons of this was the setting up of European Environment Agency in 1993, based in Copenhagen, was primarily concerning with public information role. Where public was informed about all the environmental related policy issues.

However same time in Europe, Environmental taxes were designed to change behaviour and reduce negative impacts on the environment. Which delivered a double benefit for an improved environment and greater public revenue. The biggest source of environmental tax revenue comes from petrol and diesel, with potential taxes on pollution little tapped so far.

Their revenue from environmental taxes was used to cut labour taxes. If taxes on labour provide a disincentive for firms to employ people, then environmental taxes can generate a ‘double dividend’, better environmental protection and higher employment. Roughly one out of every fourteen Euros of government revenue comes from environmental taxes. Since 1999, environmental tax revenues have been on the decline in the EU. This means there has been no rebalancing of tax from labour to sources of pollution.

Another part of EU environmental policy was the integration; The Environmental policy integration (EPI) played the protagonist part in the process of placing environmental considerations to the heart of decision-making in other sectoral policies such as energy and agriculture. The rise of EPI in the EU is reflected in the series of (Environmental Action Programmes (EAPs)) of the EU. The first EAP (1973–1976) already hinted at the need for an integrated approach arguing that ‘effective environmental protection requires the consideration of environmental consequences in all technical planning and decision-making processes at national and Community level. The fifth EAP hoped to involve policy makers and stakeholders in a co-operative process that would result in the penetration of the idea of EPI into all sectors EAP pointed out the limitations of top-down regulation and aimed ‘to achieve full integration of environmental and other relevant policies through the active participation of all the main

actors in society’. Therefore, the fifth EAP called for a bottom-up approach and influence to change.

EU Environmental policy implications: European economy and condition of environment affect the lives of all the nationals. Their main propaganda of clean and healthy environment was very much maintained at high quality. A large part of the EU economy depends on the environment. As well as an entire sector devoted to environmental technologies, many jobs in the EU are linked in some way to the environment – from forestry and agriculture to sustainable construction and large parts of the tourism industry.

Environmental technology industries, known collectively as the eco-industry, have been growing rapidly in recent years to become one of the biggest sectors of the EU economy. It helped to measure, prevent and correct environmental damage to water, air and soil and solve problems such as waste, noise and damage to ecosystems. This can help EU industry produce fewer emissions, generate less waste, reduce costs and improve competitiveness. The ecoindustry in the EU is mostly made up of small and medium sized businesses. Its annual turnover in 2008 of €319 billion represents about 2.5% of Europe’s Gross Domestic Product (GDP). The eco-industry has grown by around 7 % a year since 2000. Growth has been concentrated in resource management where new technologies such as solar and wind energy have made remarkable progress. In 2008, resource management accounted for more than half of the eco-industry sector for the first time.

Source: Roland Berger Strategy Consultants (2006)

The EU eco-industry directly employs around 3.4 million people, around 1.5% of all Europeans in employment more than in car manufacturing, chemicals or textiles. Around 600,000 new jobs were created between 2004 and 2008, in sectors such as waste and water and new jobs will needed as Europe continues to move towards its aim of becoming a lowcarbon and resource-efficient economy. The number of jobs linked to the environment extends beyond the eco-industry to sectors that depend on a good quality environment such as organic agriculture, sustainable forestry and green tourism. These jobs are often less visible than other jobs as they are spread throughout Europe among firms helping to improve environmental performance. Based on a narrow definition around 5.6 million people are directly employed in jobs linked to the environment

Source: UNEP (2010), “Global trends in sustainable energy investment� and IEA (2010), “World Energy Outlook 2010 European government had the ideology consisting to manage renewable energy sources like wind power, solar energy, hydropower and biomass are essential alternatives to fossil fuels.

These masses played crucial role in handling challenges of climate change and reducing European import of energy. They coherently created new jobs in renewable energy technologies. The main policies that supported renewable energy sources would be given a significant boost to the economy and created new jobs. As part of its action to combat climate change, the EU has committed to increase the share of energy from renewable sources to 20% (from around 8.5% today) by 2020. It is estimated that meeting this target will provide an additional 410,000 jobs and boost GDP by 0.24%.5. Many of the European administration believed on the transition of low carbon economy climate change would confiscate large economies and societies worldwide. The cost of inaction will be much higher than the cost of reducing the emissions of greenhouse gases which are warming the planet. To limit the negative effects of climate change and prevent it from reaching dangerous proportions, global

warming needs to be kept to less than 2°C above the temperature that prevailed in preindustrial times. Through the 2015 Paris Agreement, the international community has recognised that this should be the objective. To keep warming below the 2°C ceiling scientific projections show that global emissions will need to peak by 2020 at the latest and then be cut to 50% or more below their 1990 level by 2050. The European Council and the European Parliament have endorsed this as an EU objective, in the context of developed countries as a group making cuts of this magnitude.

It has been observed that Environmentally harmful subsidies worldwide are estimated at some €350-500 billion per year14, which are distributed between the following areas: Agriculture: €150 billion Energy: €50-150 billion Transport: €80-100 billion Water: €35 billion Forestry: €25 billion Fisheries: €15 billion Although this data is very rough it is estimated that government subsidies worldwide for renewable energy are only a tenth of the subsidies for the production and cheap consumption of traditional fossil fuels. The production of coal, for example, still receives more subsidy than renewable energy sources.

Europe is firm believer in context to reducing harmful activities, thereby Europe reducing subsidies on harmful activities would lead to selling of more Green products well. And it is also estimated that retail sales of green products in Europe are set to double from €114bn in 2015 in future years. But this would still only mean an increase to 5% of total EU retail sales, up from 2.5% today.

Although European Union has commenced the environmental policy with great affect on various industry and its consumers, the entire world look at Europe as a parental guide while making an approach to environmental policy decision making.

U.S and Asia environmental policy: US environmental policy involved the government officials at the federal, state, and local level to protect the environment and conserve natural resources. Their concern with Environmental protection is balanced with other public policy concerns, such as economic growth, affordable energy, and the rights of businesses and individuals. Their environmental policy would include laws and policies addressing water and air pollution, chemical and oil spills, smog, drinking water quality, land conservation and management, and wildlife protection, such as the protection of endangered species.

One the primary environmental law was addressed in 1969, shortly after the Santa Barbara oil spill, the National Environmental Protection Act (NEPA). NEPA is the basis for other U.S. environmental laws and is considered a major guiding tool for regulating federal actions that would have significant effects on environmental quality. NEPA addressed following acts: •

the Clean Air Act

•

the Clean Water Act

•

the US Water and Wetlands Policy

•

the Resource Conservation and Recovery Act

•

the Toxic Substance Control Act or TSCA

•

the recent tightening of chemical regulations under TSCA

Two major federal actions marked the modern era of US environmental policy were: •

National Environmental Policy Act: That requires government agencies and contractors to evaluate the environmental impact of a project; led to the formation of the EPA

•

Environmental Protection Agency (EPA): Who are responsible for monitoring, enforcing, and researching environmental quality

And on the other hand Asia faced two sorts of environmental challenge one associated with urban and industrial development, and other associated with natural resource exploitation.

Since 1990s, environmental pollution and degradation has emerged as a major challenge for the northeast Asian countries as a consequence of the rapid industrialization and urbanisation or the region, particular in china. The transboundary implications of these challenges are clear with pollution –both airborne and maritime.

Asia is the part of OCED developing countries; OECD country agricultural policies are generally harmful to developing country agricultural exporters, of which several major ones are in developing Asia (including India, Indonesia, Thailand, and Vietnam). While liberalisation of OECD agricultural markets might have some modest adverse effects on the environment in developing countries, there would also be positive income effects resulting in increased demand for environmental quality.

Due to lack of fund, overlapping responsibilities as well as future to institute more binding regimes compliance to mutually agreed on reduction targets. In fact, even the realization of the necessity of the environmental cooperation in northeast Asia among all stakeholders is relative low compared to Europe.

Country like China is more concerned with air and water pollution than with carbon dioxide (CO²) emissions, which are viewed as a less urgent problem. China adopted Renewable sources of energy (including hydroelectricity and excluding nuclear power) as one of the environmental policy which accounted for 17.5 percent of China’s electricity generation in 2009, second to coal (International Energy Agency 2009).However together with United Nations and United States assistance, China embarks on a multimillion- dollar renewable energy strategy to combat pollution. According to recent data November 2009 the United States and China established a renewable energy partnership (Council on Foreign Relations 2009). Besides the bio-fuel, solar, and wind technologies to be developed, the two countries will also focus on modernizing the electrical grid with new transmission lines and smart grid technology.

U.S and Asia have been the two of the similar products on environmental policy wherein both the countries have contributed among each other to partake the virtues of the environmental degradation. U.S diplomatic relation in environmental regime has emerged in recent years, though china had already focused on environmental protection way ahead.

Research methodology While writing this research paper I have set some ordinals in lieu to layman understanding for current development of environmental policy internationally. All the facts and figures have been used by the secondary sources. All the information is set forth after voracious reading all the articles that have been listed in the reference.

Conclusion Environmental policy involves researching social and scientific information, analyzing legislation and policies, and developing new policies and legislation that will help protect our planet and its people.

Economists evaluate public policies that intervene in the market economy; they generally

view it from the analytical perspective of market failure. But when it comes to save environmental degradation or innovative green technology they choose two approaches; one approach is to foster the development and diffusion of new technology by designing environmental policies to increase the perceived market payoff and maximize flexibility in compliance. The other approach is to implement policies aimed directly at encouraging the development and diffusion of environmentally friendly technologies.

Moreover Failure of some policy initiatives should be expected, and those failures should be used to terminate or improve particular programs, not to rationalize total inaction. However, policy success is very difficult to measure, because the output or effect is often intangible.

And to add to the existing exploration of the potential of available tools for environmental policy, like the "optimal" policy package; it would no doubt include a combination of many approaches including the prohibition of certain activities, technical specifications for others, the imposition of fees, etc.

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