Growing demand for agricultural products leading to significant social and environmental consequences around the world. The expansion of international trade has created global supply chains, directly linking consumers to geographically distant impacts including carbon emissions, biodiversity loss, freshwater depletion, soil degradation and labor rights issues – the latter of which All have local, regional and global relevance.
Due to its huge size and consumer market, India is a global trading base for agricultural products. It has also made remarkable social and economic development over the past several decades. This has increased the demand as well as supply of these products.
Large land areas in India are used to meet international demand for cereals, fruits and vegetables, among other products, which puts pressure on the national soil and water resources. Also, India’s vast consumer market means that vast amounts of land, even outside its borders, are used to meet domestic demand.
What is food-based impact accounting?
The expansion of such imports has contributed to increasing environmental pressures in the exporting countries. recent studies have shown A large proportion of the total ecological impact is due to displacement of environmental damage through international trade.
Tackling these demand-supply dynamics is now a key aspect of international environmental governance and represents a major challenge in achieving the United Nations Sustainable Development Goals and other climate action and biodiversity conservation goals.
The current paradigm in measuring impacts and allocating responsibility is based on production-based accounting: it measures impact at the location where products are produced.
There are concerns about its limitations in managing ‘leaks’, fixing accountability and ensuring equity and justice between producers and consumers.
One alternative that has emerged is consumption-based accounting.
What is consumption based accounting?
Consumption-based accounting accounts for impacts at the point of consumption, attributing all social and environmental impacts to final products and final consumers during the course of production and trade. That is, the approach urges the consumer (whether social group or country) to accept responsibility for the embodied or ‘virtual’ effects of the product being consumed.
This approach has become prominent because of growing concerns between countries that are producers and those that are consumers, leading to a high degree of international co-dependency. This approach has also called for the adoption of sustainable consumption practices as a form of environmental action.
This has important implications for coverage of effects and for determining who has primary responsibility for doing the work.
What is the demand outlook?
From a demand perspective, the premise of this approach is straightforward: since pressure on natural and human resources is largely a direct result of consumption practices in developed economies, the responsibility for any consequences caused by the production process must fall on those consumers as well. . ,
It also reflects arguments of equality and justice related to the issue of historical accountability. Studies show that developing economies like India have contributed only 23% Global cumulative emissions are responsible for about 20–40% of the global average temperature increase since the pre-industrial era. The approach therefore serves to further reduce population and emissions by shifting substantial impacts from emerging markets such as India to economically developed countries with significantly lower populations.
A consumption-based approach thus highlights the responsibility of industrialized states to reduce impacts and the rights of developing economies not to bear excessive burdens. It is an extension of the principle of common but differentiated responsibilities that underpins global climate governance.
This approach also accounts for a growing element of international trade: the existence of tripartite supply chains, where products are produced in one country, processed in another and consumed in a third country. By tracing the flow of intermediate and final products through a global supply chain, it can establish links between the locations where a product is ultimately consumed and where its environmental impact is manifesting.
What is supply outlook?
From a supply perspective, proponents of consumption-based accounting claim that it can encourage cleaner production because producer countries are encouraged to implement strategies that reduce the environmental footprint of their exports.
They also have incentives to raise the living standards of actors in agricultural supply chains in order to secure their access to foreign markets.
The approach could also go a long way in fixing ‘leaks’ in production systems, where production is often moved to jurisdictions that are relatively liberal about production standards (including India).
What are the benefits of environmental action?
The application of this approach to estimating carbon emissions as embodied emissions and water use as virtual water has also been in the scientific literature for some time, but has only recently entered policy making.
For example, the European Commission has recently taken steps to ensure that products consumed in the EU do not contribute to deforestation in their country of origin. The measure is expected to significantly reduce carbon emissions from deforestation as well as biodiversity loss, since the EU is the main consumer of agricultural and forestry products.
Even from a consumption-based accounting perspective, India finds itself in a unique position. Currently, India has an environmental footprint due to the consumption of Indian agricultural produce by major developed economies. In contrast, India’s deforestation footprint outside its borders has increased has been growing more rapidly over the past two decades, even though it remains below many G-20 countries on a per capita basis.
If the environmental impacts of our consumption are outside our borders, it is not easy to consider them because they are not “our problem”. But influence abroad is the result of our demand, so we must accept a share of the responsibility.
Can Impact Attribution Be More Fair?
Since consumption-based emissions-accounting can identify the consequences for domestic and foreign demand for agricultural products, it may also be able to facilitate an agreement on global environmental action based on sharing the responsibilities of producers and consumers. Is.
Current agreements are hampered by a lack of agreement on the historical and current role of developed and developing economies in the climate, pollution and biodiversity loss crisis. Taking responsibility for some of the impact by developed economies provides an opportunity for coordinated action, while allowing developing economies such as India to develop and improve their agricultural systems.
Finally, consumption-based accounting is not easy to implement due to liability, monitoring and compliance concerns, but it is useful, especially as a tool with which to voluntarily diagnose impact-intensive consumption patterns. .
The approach can also be applied at the household level, as it helps shift the focus from producers to consumers, and encourages individual and collective changes in consumption behaviour.
Manan Bhan is a Fellow at the Ashoka Trust for Research in Ecology and the Environment, Bengaluru.