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Modi Govt Did A U-Turn On Its Own Corporate Environment Responsibility Guidelines, Documents Show

Eight months before it scrapped the 2018 Corporate Environment Responsibility guidelines, the union environment ministry defended them strongly in the Delhi High Court arguing that they were needed for the protection of the environment.
Union Minister of Environment, Forest and Climate Change Prakash Javadekar addresses a press conference on cabinet decisions on October 14, 2020 in New Delhi, India.
Hindustan Times via Getty Images
Union Minister of Environment, Forest and Climate Change Prakash Javadekar addresses a press conference on cabinet decisions on October 14, 2020 in New Delhi, India.

NEW DELHI— When a real estate lobby group challenged the Narendra Modi government’s green guidelines which required developers to pay a percentage of their capital investment into a project to ensure they met their Corporate Environment Responsibility (CER) obligations, the government vociferously defended the guidelines in court.

The guidelines, introduced in an office memorandum in May 2018, said companies must pay a maximum of between 0.25% and 2% of their capital investment as CER funds for spending on specific activities. This was applicable for firms doing business in all sectors, including real estate.

So in an affidavit filed in the Delhi High Court in February 2020, the environment ministry said the CER funds were meant to address the adverse impacts caused by projects on the people and environment in their immediate surroundings.

Yet seven months later, the environment ministry reversed its stance citing “several representations” and a petition filed by the real estate lobby group Confederation of Real Estate Developers’ Association of India (CREDAI) in the Delhi High Court challenging the 2018 guidelines. A fresh memorandum, issued on September 30 did away with the 2018 CER guidelines all together. Now government appointed expert committees have been mandated to sign-off on a set of mitigation measures as part of the project’s Environment Management Plan, or EMP, into which the CER is subsumed.

The September 30 memorandum contradicts the government’s stated position in the Delhi High Court specifically on this point. In its February affidavit, the government had categorically argued that a project’s CER obligations “address concerns of the immediate surroundings which is not being reflected in the EMP, which generally consists of mitigation plan being taken up within the premises.”

In other words, the affidavit stated that the CER’s purpose is to address concerns which arise due to adverse impacts caused by projects on the environment and people in their immediate surroundings. These concerns, it added, are not addressed in the EMPs drafted for addressing adverse impacts caused by projects, as they are typically confined to areas within the premises of the projects.

The environment ministry’s u-turn about the CER guidelines and reference to the CREDAI petition as one of the factors for drafting the September 30 OM are both hard to explain as the Delhi High Court is yet to decide in favour of either CREDAI or the Government. The government, in effect, has conceded the match without waiting for the umpire’s decision.

“It seems odd that the MoEFCC would rely on the simple filing of the writ petition challenging the 2018 OM to be a reason to do away with the 2018 OM!” said Shibani Ghosh, public interest lawyer and a fellow at the Centre for Policy Research, referring to the 2018 Office Memorandum that laid out the CER guidelines.

Ghosh said this after pointing out that “the three orders available in this matter on the Delhi HC website show that no substantive order has been issued in the case yet”.

The contradiction is so glaring that when HuffPost India pointed it out to environment minister Prakash Javadekar over email, he forwarded HuffPost India’s questions to his officers saying, “Important contradiction. We are now defending an OM which we have cancelled and changed. Brief on phone in the evening.” (Javedekar’s internal correspondence was appended to the official response sent to this reporter by his ministry.)

screenshot of union environment minister Prakash Javadekar's email to the ministry's top officials.
huffpost india
screenshot of union environment minister Prakash Javadekar's email to the ministry's top officials.

HuffPost India is not privy to the details of Javadekar’s evening briefing on the phone, but the ministry’s final reply sent to us over email side-stepped two specific questions about why the 2018 guidelines were replaced by the new norms issued in September this year as well as the obvious contradiction in the ministry’s position about the CER.

Instead, in its official statement to HuffPost India, the environment ministry insisted that, through the 2020 norms, “social/environmental concerns and obligations of PP in the surrounding areas of the project get duly addressed in true spirit.” PP stands for project proponent, or the entity developing a particular project.

Many independent environment experts that this reporter spoke with expressed their dismay at the government’s decision to fold a project’s corporate environment responsibility obligations into its environmental management plan as well as replacement of the 2018 guidelines with the September 30 office memorandum.

The memorandum, Advocate Shilpa Chohan of the Indian Environmental Law Organisation said, “dismantles the financial support for community based activities affected by the project.”

The impacts of projects on local communities are usually not properly assessed or included in environment management plans, advocate Chohan said. “So the present OM will further marginalise affected communities.”

The 2018 Corporate Environment Responsibility guidelines, Chohan said, gave the district magistrate the discretion to direct spending of the CER funds on unforeseen project impacts that sprung up as the project progressed and were not included in the environment management plans drawn up in the beginning.

“It’s in fact akin to sounding death knell to the very concept of CER and reinforces MoEFCC’s present reputation as defender of everything but environment and ecology. Sad,” said Manoj Mishra, a former Indian Forest Service (IFS) officer and presently Convenor of the Yamuna Jiye Abhiyaan. The MoEFCC is an acronym for the Ministry of Environment Forests and Climate Change.

Ironically, the most lucid critique of the Modi government’s actions in September can be found in the Modi government’s affidavit filed in February.

WHAT THE MODI GOVT TOLD THE DELHI HC ABOUT ITS 2018 CER GUIDELINES

The February affidavit presented a robust defence of corporate responsibility guidelines, or CER, noting the need for “a concrete Corporate Environmental Policy for protection of environment.”

Existing corporate social responsibility obligations, the affidavit said, did not address environmental concerns and were measured as a share of corporate profits. An unprofitable company, therefore has no CSR obligations. CER obligations, on the other hand, are based on capital expenditure and were imposed irrespective of profits.

Excerpt from the affidavit filed by the union environment ministry in the Delhi High Court in February. Paragraph 10 clearly shows the environment ministry noting the need for a separate Corporate Environment Responsibility fund in addition to the Environment Management Plan.
Akshay Deshmane/HuffPost India
Excerpt from the affidavit filed by the union environment ministry in the Delhi High Court in February. Paragraph 10 clearly shows the environment ministry noting the need for a separate Corporate Environment Responsibility fund in addition to the Environment Management Plan.

The ministry also explained why the Corporate Environment Responsibility has been kept as a separate entity outside of the Environment Management Plan — a key distinction.

“The object of the CER is to address concerns of the immediate surroundings which is not being reflected in the EMP, which generally consists of mitigation plan being taken up within the premises,” it said. EMPs, or Environment Management Plans, are part of the legally mandatory Environment Impact Assessment process, which every project has to undergo before it is given the Environment Clearance by the ministry.

A CER regime with clear guidelines, the environment ministry told the court, was necessary “in order to have transparency and uniformity while recommending CER.”

Yet despite making all these arguments in favour of 2018 guidelines in February 2020, the environment ministry scrapped them a few months later.

WHY THE SEPTEMBER 2020 OFFICE MEMO IS BEING CRITICISED

Apart from the point about integration of the activities to be undertaken for Corporate Environment Responsibility into the Environment Management Plan, independent experts pointed out several other problems with the 2020 OM.

“The May 2018 OM was pretty decent and reasonable although percentages of money to be spent could have been contested,” said retired IFS officer Misra.

“It also had an element of accountability built in where CER progress was to be reported every six months. Thirdly, earmarking of funds provides scope to plan and execute activities as per beneficiaries’ preference and requirements.”

The 2020 amendment, Misra said, puts the project developer in the driver’s seat, rather than the beneficiaries, and makes the process less accountable.

According to Mumbai-based advocate Lara Jesani, the September 2020 OM is similar to the provision proposed in the controversial draft Environment Impact Assessment (EIA) notification 2020. “The project proponent now has an excuse to not do any additional spending towards environment conservation or sustainability in the guise of doing CER activities under EMP,” said advocate Lara Jessani.

As HuffPost India reported earlier about the similar provision in the draft EIA 2020, it has an ambiguity which helps the real estate at the cost of the environment.

But in its official statement cited earlier in this report, the environment ministry told HuffPost India that as per the September 2020 OM, expert committees would consider issues raised by project-affected communities in the initial public consultation phase of the project. The committees would also assess the commitments made by project developers to address these issues. The committee would then prescribe specific mitigation measures that the project developer would have to implement.

As a consequence, the ministry said “it would be incorrect to infer that removal of CER conditions through O.M. dated 30th September, 2020 is in contravention with the underlying philosophy of casting environment mitigation obligation on project proponent while setting up of the project/activity.”

Environment lawyer Shilpa Chohan disagreed.

The September 30 OM, she said, is “vague and provides no guidance” to expert committees which assess projects about how they should “prescribe specific condition(s) in physical terms while recommending proposals” for environment clearance.

This is important, Chohan pointed out, “given the flawed nature of preparation of EIA reports and public hearing consultations where no specific commitments are made as regards to social-environment activities beneficial to the affected community.”

Chohan - who is a partner at the Indian Environmental Law organisation - also pointed out that, “Perusal of any public hearing proceedings would highlight that at the first instance, there are no concrete responses or commitments made by the project proponent and where they are made, are inadequate and vague.”

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This article exists as part of the online archive for HuffPost India, which closed in 2020. Some features are no longer enabled. If you have questions or concerns about this article, please contact indiasupport@huffpost.com.