Letter to FM calls for climate-centric budgeting and ecological restoration

By A Representative 

Power and climate policy analyst Shankar Sharma has written to Union Finance Minister Nirmala Sitharaman seeking urgent fiscal and policy interventions to address the growing threats posed by climate change and ecological degradation in India.

In a detailed representation addressed to the Finance Minister, with copies marked to Prime Minister Narendra Modi and the Vice-Chairperson of NITI Aayog, Sharma called for a comprehensive national framework integrating climate resilience, energy policy, water management and ecological restoration.

Referring to recent remarks attributed to Sitharaman that “the prosperity of humanity depended on preserving nature, wildlife and greenery,” Sharma welcomed the statement and argued that such concerns must be reflected in government policies and development priorities. He said there was a growing gap between public commitments to environmental protection and the realities of forest diversion, biodiversity loss and ecological degradation.

Citing concerns raised by environmental experts and data from recent forest assessments, Sharma noted that while official figures indicate a marginal increase in overall forest and tree cover, natural forests and biodiversity-rich ecosystems continue to face significant pressures. He pointed to parliamentary disclosures showing that more than 1.73 lakh hectares of forest land were approved for non-forest purposes between 2014-15 and 2023-24, including over 92,000 hectares diverted during the past five years.

The representation argues that climate change should no longer be viewed solely as an environmental issue but as a major fiscal and economic challenge. According to Sharma, increasing expenditures on disaster relief, drought and flood management, public health, water security and infrastructure repair are likely to place growing burdens on public finances if preventive action is not taken.

He urged the government to move beyond a development model driven primarily by GDP growth and increasing resource consumption. Instead, he advocated greater emphasis on resource productivity, energy efficiency, water conservation, ecological sustainability and equitable access to natural resources.

Among the measures proposed are large-scale programmes to improve energy efficiency in agriculture, industry and buildings; nationwide rainwater harvesting and groundwater recharge initiatives; watershed restoration; protection of wetlands and rivers; and expanded support for decentralised renewable energy systems.

Sharma described forests, wetlands, grasslands and biodiversity-rich landscapes as “natural climate infrastructure” and called for substantially higher budgetary allocations for ecological restoration, agroforestry, conservation programmes and urban green infrastructure.

The representation also recommends a series of fiscal reforms, including the creation of a National Climate Resilience Fund, climate screening of major public investments, green budgeting across ministries, incentives for states that improve ecological indicators, expanded concessional finance for renewable energy projects, and stronger climate-risk disclosure requirements for infrastructure developments.

Particular emphasis was placed on protecting vulnerable groups, including small and marginal farmers, tribal communities, forest-dependent populations, residents of drought- and flood-prone regions, and the urban poor. Sharma suggested establishing dedicated adaptation funds to support climate-resilient livelihoods, water security measures and ecosystem restoration programmes.

Warning that environmental degradation could impose economic costs equivalent to several percentage points of national income annually, Sharma said that failure to adopt a more holistic development paradigm could expose future generations to severe ecological, economic and social hardships.

He urged the Finance Ministry to convene officials, experts and advisers to examine a series of discussion papers attached to his representation and consider placing the matter before the Union Cabinet. Sharma also offered to make a detailed presentation to government officials on policy options for climate-resilient development.

The representation concludes that India’s long-term prosperity depends on balancing economic growth with ecological sustainability, social justice and the protection of natural resources, arguing that climate resilience should become a central pillar of future fiscal and developmental planning.