Government Expenditure on Environment:

Concerning Uttar Pradesh

DISSERTATION
SUBMITTED TO THE UNIVERSITY OF LUCKNOW FOR THE DEGREE OF

Master of Commerce
IN
Applied Economics

By
Simran Narang

Under the Supervision of

Dr. Karuna Shanker Kanaujiya
Department of Applied Economics
Faculty of Commerce
University of Lucknow

DEPARTMENT OF APPLIED ECONOMICS

FACULTY OF COMMERCE
UNIVERSITY OF LUCKNOW
LUCKNOW
2023

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 DECLARATION
I hereby declare that the research work presented in this dissertation titled Government
Expenditure on Environment: Concerning Uttar Pradesh has been conducted by me under
the guidance by my Supervisor Dr. Karuna Shanker Kanaujiya, Department of Applied
Economics, University of Lucknow for the award of Degree of Master of Commerce in Applied
Economics. This dissertation has been formatted as per Department’s guidelines. Any relevant
material taken from the open literature has been referred and cited, as per established ethical
norms and practices.

No part of this literature has been submitted for the award of any degree from this university
or any other university before.

Date: 10th June 2023 Name of Student: Simran Narang

Place: Lucknow University Roll Number: 2110012115143
Signature:

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 ACKNOWLEDGEMENT

I am using this opportunity to express my deepest gratitude and special thanks to my Supervisor
Dr. Karuna Shanker Kanaujiya, Department of Applied Economics, University of
Lucknow who despite being extraordinarily busy with his duties, took time out to hear, guide
and keep me on the correct path and allowing me to carry out my dissertation.

I express my deepest thanks to Dr. Rachna Mujoo, Head of Department, Department of

Applied Economics, University of Lucknow for taking part in useful decision & giving
necessary advices and guidance and arranged all facilities to make life easier. I choose this
moment to acknowledge her contribution gratefully.

I am also grateful to my classmates for their editing help and moral support. Thanks, should
also go to the Librarian Ma’am, Research Scholars from the university, who impacted and
inspired me.

Lastly, I would be remiss in not mentioning my family, especially my parents. Their belief in
me has kept my spirits and motivation high during this process.

I perceive as this opportunity as a big milestone in my career development. I will strive to use
gained skills and knowledge in the best possible way, and I will continue to work on their
improvement, in order to attain desired career objectives. Hope to continue cooperation with
all of you in the future.

Sincerely,

Simran Narang

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 PREFACE

The state of Uttar Pradesh, located in northern India, is not only one of the most populous states
in the country but also home to a diverse range of ecosystems and natural resources. As the
state continues to experience rapid urbanization and industrialization, there is an increasing
need to address environmental challenges and promote sustainable development.

Government expenditure on the environment plays a vital role in safeguarding the state's
natural heritage, mitigating the impact of climate change, and ensuring the well-being of its
residents. It encompasses various initiatives and programs aimed at preserving biodiversity,
improving air and water quality, conserving forests, promoting renewable energy, and
implementing effective waste management systems.

In recent years, the government of Uttar Pradesh has recognized the significance of
environmental conservation and has taken steps to prioritize sustainable development. It has
demonstrated its commitment to addressing environmental concerns by allocating a
considerable portion of its budget towards environmental protection and sustainable initiatives.

This preface aims to provide an overview of the government's expenditure on the environment
in Uttar Pradesh, highlighting key areas of focus, notable initiatives, and their impact on the
state's ecological well-being. By understanding the government's financial commitment and
strategic approach towards environmental sustainability, we can gain insight into the state's
progress, challenges, and prospects in ensuring a greener and more sustainable Uttar Pradesh.

Simran Narang

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 TABLE OF CONTENTS

Serial Number Title Page Number

1 Declaration 2

2 Acknowledgement 3

3 Preface 4

4 Chapter 1: Introduction 6-11

5 Chapter 2: Literature Review 12-13

6 Chapter 3: Methodology 14-22

7 Chapter 4: Data Analysis, 23-46

Findings, and Interpretation

8 Chapter 5: Conclusion and 47-49

Recommendation

9 References List 50

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 CHAPTER 1: INTRODUCTION

The state of Uttar Pradesh, nestled in the heartland of India, faces significant environmental
challenges due to its burgeoning population, rapid urbanization, and industrial growth. The
government of Uttar Pradesh recognizes the pressing need to address these challenges and has
made substantial investments in environmental protection and sustainable development.

The background and rationale for studying government expenditure on the environment are
rooted in the recognition of the critical role that the environment plays in sustainable
development and the well-being of societies. Here are some key points that highlight the
importance of studying government expenditure on the environment:

Environmental Challenges: The world is facing significant environmental challenges such as

climate change, deforestation, pollution, loss of biodiversity, and resource depletion. These
challenges have wide-ranging impacts on ecosystems, human health, and socio-economic
systems. Studying government expenditure on the environment helps understand how
resources are allocated to address these challenges and promote environmental sustainability.

Policy Priorities: Governments play a crucial role in formulating and implementing

environmental policies and regulations. By studying government expenditure on the
environment, researchers can assess whether environmental issues receive adequate attention
and resources in policy priorities. This analysis provides insights into the commitment of
governments towards environmental protection and their effectiveness in addressing
environmental challenges.

Sustainable Development Goals (SDGs): The United Nations' Sustainable Development

Goals provide a framework for global development efforts, including specific targets related to
environmental sustainability. Government expenditure on the environment is closely linked to
achieving these goals, such as combating climate change, ensuring clean water and sanitation,
protecting biodiversity, and promoting sustainable agriculture. Studying government spending
helps evaluate progress towards these goals and identify areas that require more attention and
investment.

Economic Implications: Environmental degradation and resource depletion can have

significant economic consequences, including reduced agricultural productivity, increased

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healthcare costs due to pollution-related illnesses, and loss of ecosystem services. Analysing
government expenditure on the environment allows for an assessment of the economic impact
of environmental policies and investments. It helps understand the potential returns on
investment in environmental protection and the cost-effectiveness of different approaches.

Accountability and Transparency: Studying government expenditure on the environment

contributes to promoting accountability and transparency in public resource management. It
allows for an assessment of whether allocated funds are used efficiently and effectively to
achieve environmental objectives. This analysis can support evidence-based decision-making,
help identify areas of inefficiency or misallocation, and facilitate public scrutiny and
engagement in environmental governance.

International Commitments: Many countries have committed to international agreements

and protocols related to environmental protection, such as the Paris Agreement on climate
change and the Convention on Biological Diversity. Studying government expenditure on the
environment helps assess the alignment of national budgets with these commitments, track
progress, and identify areas where additional financial resources are needed.

By examining the government's efforts to address environmental concerns, we can gain insights
into the challenges faced by Uttar Pradesh and the strategies implemented to mitigate them.
Furthermore, we can assess the progress made, identify potential areas for improvement, and
explore the prospects of a greener and more sustainable Uttar Pradesh.

RESEARCH OBJECTIVES

 To analyze the trends and patterns of government expenditure on the environment in

Uttar Pradesh over a specified period.

 To evaluate the effectiveness and efficiency of government spending on environmental

conservation and management in the state.

 To assess the alignment of environmental expenditure with sustainable development

goals and environmental policy priorities in Uttar Pradesh.

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 To identify the challenges and barriers to effective utilization of government funds
allocated for environmental purposes in the state.

 To propose recommendations for improving the allocation, utilization, and impact of

government expenditure on the environment in Uttar Pradesh.

RESEARCH QUESTIONS

 What is the trend of government expenditure on the environment in Uttar Pradesh

over the past decade?

 What are the main areas and sectors in which government funds are allocated for
environmental purposes in Uttar Pradesh?

 How effectively and efficiently are these funds utilized for environmental
conservation and management in the state?

 To what extent does government expenditure on the environment align with

sustainable development goals and environmental policy priorities in Uttar Pradesh?

 What are the challenges and barriers faced in the utilization of government funds
allocated for environmental purposes in the state?

 What measures can be recommended to enhance the allocation, utilization, and impact
of government expenditure on the environment in Uttar Pradesh?

 By addressing these objectives and questions, this dissertation aims to provide

valuable insights into the government's expenditure on the environment in Uttar
Pradesh. The findings and recommendations can assist policymakers, environmental
practitioners, and researchers in improving the effectiveness and efficiency of

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 environmental expenditure, ultimately contributing to sustainable development and
environmental well-being in the state.

SIGNIFICANCE AND POTENTIAL CONTRIBUTIONS OF THE STUDY

Policy Guidance: The study on government expenditure on the environment in Uttar Pradesh
holds significant policy relevance. By examining the current status and effectiveness of
environmental expenditure, the study can provide guidance to policymakers in terms of
resource allocation, prioritization of environmental programs, and policy improvements. It can
inform decision-makers about the areas that require more investment and help shape more
effective environmental policies.

Environmental Governance Enhancement: Understanding the patterns and effectiveness of

government expenditure on the environment can contribute to enhancing environmental
governance in Uttar Pradesh. The study can shed light on the strengths and weaknesses of the
existing institutional frameworks and mechanisms, facilitating recommendations for
improvement. It can help identify gaps and bottlenecks in the utilization of funds, leading to
better coordination and more efficient resource management.

Sustainable Development: The study's findings can contribute to promoting sustainable

development in Uttar Pradesh. By evaluating the impact of environmental expenditure, the
research can highlight successful initiatives and identify areas for improvement. It can guide
policymakers in aligning environmental spending with sustainable development goals,
ensuring that the allocated resources lead to positive environmental outcomes, including
conservation, pollution control, and sustainable economic growth.

Stakeholder Engagement: The study can foster stakeholder engagement and participation in
environmental decision-making processes. By analysing the factors influencing government
expenditure on the environment, the research can provide insights into the roles and
perspectives of different stakeholders, including government agencies, civil society
organizations, and local communities. It can encourage dialogue and collaboration among
stakeholders, leading to more inclusive and effective environmental governance.

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State-Specific Analysis: The focus on Uttar Pradesh adds to the significance of the study. Uttar
Pradesh is one of the most populous states in India and faces various environmental challenges,
including pollution, deforestation, and resource depletion. By conducting a state-specific
analysis, the study can generate context-specific knowledge and recommendations that are
tailored to the unique environmental, social, and political dynamics of Uttar Pradesh. This can
enhance the relevance and applicability of the findings to the state's specific needs and
challenges.

GOVERNMENT EXPENDITURE ON THE ENVIRONMENT: TRENDS AND

ALLOCATION

Government expenditure on the environment refers to the financial resources allocated by

governments towards environmental protection, conservation, and sustainable development
initiatives. The trends and allocation of government expenditure on the environment vary
across countries and regions. However, here is a general overview of the trends and allocation
patterns observed:

Increasing Trends:

In recent years, there has been a growing recognition of the importance of environmental
sustainability and the need for increased investments in environmental protection.

Many governments have been increasing their environmental expenditure in response to global
environmental challenges, such as climate change, biodiversity loss, and pollution.

International commitments and agreements, such as the United Nations Sustainable

Development Goals (SDGs) and the Paris Agreement, have also put pressure on governments
to allocate more funds towards environmental initiatives.

Allocation Patterns:

 Allocation by sectors: Government expenditure on the environment is often allocated

across different sectors, such as forestry and biodiversity conservation, water resource
management, renewable energy, waste management, and pollution control.
 Sector-specific priorities: The allocation of funds within each sector depends on the
specific priorities and challenges faced by the country or region. For example, countries

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 with rich biodiversity may prioritize expenditures on protected areas and species
conservation, while water-scarce regions may focus on water resource management and
conservation.
 Urban-rural divide: Expenditure patterns may also vary between urban and rural
areas, with urban regions typically allocating more funds towards pollution control and
waste management, while rural areas focus on agricultural and natural resource
management.
Challenges and Disparities:

 Limited resources: Governments often face resource constraints, which may limit the
overall expenditure on the environment. This can lead to challenges in adequately
addressing environmental issues and achieving sustainable development goals.
 Disparities across regions: Allocation of environmental expenditure may not be
uniform across regions, with disparities observed between urban and rural areas or
among different administrative units. This can result in uneven environmental
outcomes and inequalities in access to environmental services.
 Policy coherence: Ensuring coherence between environmental policies and budgetary
allocations is essential for effective expenditure. Inadequate coordination and
alignment between policies and budgetary decisions can hinder the efficient use of
funds and limit the desired environmental impact.
Transparency and Accountability:

Increasingly, there is a focus on transparency and accountability in environmental expenditure.

Governments are being encouraged to disclose information on budget allocations,
expenditures, and outcomes to promote public awareness and ensure efficient use of funds.

Civil society organizations, environmental watchdogs, and citizens play a crucial role in
monitoring and holding governments accountable for their environmental expenditure.

Understanding the trends and allocation of government expenditure on the environment is

important for assessing the financial resources dedicated to environmental protection and
conservation. It helps identify areas of priority, evaluate policy effectiveness, and guide
decision-making processes to ensure sustainable and equitable environmental outcomes.

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 CHAPTER 2: LITERATURE REVIEW

The effect of government spending on the environment may be distinguished between direct
and indirect effects. On the one hand, higher government expenditure is more likely to include
redistributive transfers, which result to increased income equality and thus to higher demand
for environmental quality. Moreover, if the environment is a luxury public good, it is likely that
it will only be demanded when the demand for other public goods has been satisfied, i.e., at
large levels of government size (Frederik and Lundström, 2001).

In a related study, Lopez et al. (2011) identify four mechanisms by which the level and
composition of fiscal spending may affect pollution levels,1 namely the scale (increased
environmental pressures due to more economic growth), composition (increased human capital
intensive activities instead of physical capital intensive industries that harm the environment
more), technique (due to higher labour efficiency) and income (where increased income raises
the demand for improved environmental quality) effects.

On the other hand, government size has been found to reduce prosperity (Bajo-Rubio, 2000,
Bergh and Karlsson, 2010, Folster and Henrekson, 2001, Ghali, 1998) which may in turn
lead to lower pollution at some levels and to higher pollution at others, depending on the shape
of the Environmental Kuznets Curve (EKC), as shown by Grossman and Krueger (1995).
Therefore, the total effect of government expenditure on the environment cannot be determined
a priori.

Given this background and following a similar empirical strategy to that used by Welsch (2004)
and Cole (2007),2 our purpose is to investigate first how government expenditure affects
pollution at given income levels and other control variables, in particular to estimate a direct
effect that mainly captures the composition effect and part of the technique effect, as defined
in Lopez et al. (2011) and described in the Methodology section of this study; and then to
examine the effect of government expenditure on the environment through the government
expenditure impact on income (indirect effect) and to add the indirect effect to the direct effect
to obtain the total effect.

Many of the studies examining the government size–growth relationship finds a negative
impact of the former on the latter. Increasing public expenditure may deteriorate economic

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growth by crowding-out the private sector, due to government inefficiencies, distortions of the
tax and incentives systems and interventions to free markets (Afonso and Furceri, 2008, Bajo-
Rubio, 2000, Barro, 1991). In addition, the share of government expenditure dedicated to
productivity increase in the private sector is typically smaller in countries with big governments
(Folster and Henrekson, 2001). Furthermore, related papers by Bergh and Karlsson (2010)
and Afonso and Jalles (2011) find that government size correlates negatively with growth. At
the same time, government expenditure may also have a positive effect on economic
performance, due to positive externalities, by harmonizing conflicts between private and social
interests, providing a socially optimal direction for growth as well as offsetting market failures
(Ghali, 1998).

The estimated sign of the direct effect of government size on pollution is ambiguous in the
empirical literature. Frederik and Lundström (2001) investigate the effect of political and
economic freedom on the level of CO2 emissions and find that the effect of government size
on levels of pollution differs according to the initial government size. They suggest that
increased economic freedom, in terms of lower government size, decreases CO2 emissions
when the size of government is small but increases emissions when the size is large.

According to Bernauer and Koubi (2006) an increase in the government spending share of
GDP is associated with more air pollution and this relationship is not affected by the quality of
the government. However, they do not consider quadratic or cubic terms of income in their
analysis and they ascribe their finding to the ambiguous hypothesis that higher income leads to
both bigger government and better air quality.

Recently, Lopez et al. (2011) provide a theoretical basis for determining the effect of
government expenditure on pollution. Specifically, they stress the importance and estimate
empirically the effect of fiscal spending composition on the environment. They argue that a
reallocation of government spending composition towards social and public goods reduces
pollution. Moreover, they find that increasing total government size, without changing its
orientation, has a non-positive impact on environmental quality. However, in a related study,
Lopez, and Palacios (2010) examine the role of government expenditure and environmental
taxes on environmental quality in Europe.

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 CHAPTER 3: METHODOLOGY

The methodology chapter outlines the research design and methods used to study government
expenditure on the environment in Uttar Pradesh. It describes the data collection process,
analysis techniques, and any limitations or biases that may have influenced the study's
outcomes. Here is an overview of the methodology section:

Research Design: Explain the overall research design, such as whether it is a qualitative,
quantitative, or mixed-methods approach. Justify the chosen research design based on the
research objectives and questions.

Data Collection: Describe the data collection methods used to gather information on
government expenditure on the environment in Uttar Pradesh. This may include:

a. Primary Data: Explain if any primary data was collected, such as through surveys,
interviews, or focus groups. Detail the sampling strategy, the target population, and the number
of participants involved. Discuss any ethical considerations and steps taken to ensure data
validity and reliability.

b. Secondary Data: Discuss the use of secondary data sources, such as government reports,
budget documents, official statistics, and academic literature. Specify the sources consulted
and provide details on the data variables, time period, and geographical coverage.

Data Analysis: Describe the analytical techniques used to analyse the collected data. This may
involve quantitative methods, qualitative analysis, or a combination of both. Explain any
statistical tools, software, or frameworks employed for data analysis and interpretation. Discuss
how the data was coded, categorized, and synthesized to derive meaningful insights.

Variables and Indicators: Outline the key variables and indicators used to measure
government expenditure on the environment. Explain the rationale behind their selection and
discuss their relevance to the research objectives. Provide definitions and sources for each
variable or indicator used.

Limitations and Biases: Acknowledge any limitations or biases that may have affected the
study's findings. This could include data limitations, sample size constraints, potential biases
in data collection methods, or any other factors that may have impacted the research outcomes.

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Discuss how these limitations were addressed or mitigated to ensure the validity and reliability
of the study.

Ethical Considerations: Discuss any ethical considerations associated with the research,
particularly when collecting primary data through surveys, interviews, or other means.
Describe how informed consent was obtained, how participant confidentiality was ensured, and
any steps taken to comply with ethical guidelines or institutional review board (IRB)
requirements.

Validation: Explain the steps taken to validate the research findings, such as triangulation of
data from multiple sources, member checking, or peer review. Discuss any measures
implemented to enhance the trustworthiness and credibility of the study's results.

By providing a clear and comprehensive overview of the methodology, the dissertation ensures
transparency and allows readers to evaluate the research process and the reliability of the
findings.

RESEARCH DESIGN AND APPROACH

The research design and approach for studying government expenditure on the environment
can vary depending on the specific research objectives, available data, and the context of the
study. Here is an overview of some common research designs and approaches used in this area:

Quantitative Research Design:

 Cross-sectional analysis: This involves analyzing data from a single point in time to
examine the relationship between government expenditure on the environment and
specific outcomes or indicators. It can involve statistical techniques such as regression
analysis to identify associations between variables.
 Time-series analysis: This design involves analyzing data over multiple time periods
to assess trends and changes in government expenditure on the environment and its
impact over time. It can help identify patterns, evaluate policy effectiveness, and assess
the long-term impact of expenditure.

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 Qualitative Research Design:
 Case studies: Conducting in-depth case studies of specific regions or programs can
provide detailed insights into the allocation and effectiveness of government
expenditure on the environment. This approach involves collecting qualitative data
through interviews, observations, and document analysis.
 Policy analysis: Examining policies, legal frameworks, and institutional arrangements
related to environmental expenditure can help understand the context and factors
influencing allocation and effectiveness. This involves analyzing policy documents,
reports, and conducting interviews with policymakers and experts.
Mixed-Methods Research Design:

Integrating both quantitative and qualitative approaches can provide a comprehensive

understanding of government expenditure on the environment. This can involve collecting and
analysing quantitative data on expenditure trends and outcomes, as well as qualitative data to
explore the underlying factors, stakeholder perspectives, and policy processes.

STATISTICAL AND ECONOMETRIC METHODS EMPLOYED

When analysing government expenditure on the environment, various statistical and

econometric methods can be employed to assess the relationships, trends, and impacts of
expenditure. Here are some commonly used methods in this context:

Descriptive Statistics:

Mean, median, and standard deviation: These statistics provide a summary of expenditure data,
allowing researchers to understand the central tendency, variation, and distribution of
environmental expenditure.

Bar charts and graphs: Visual representations of expenditure data can help identify trends,
patterns, and comparisons across different sectors or time periods.

Regression Analysis:

 Ordinary Least Squares (OLS) regression: This method is commonly used to

examine the relationship between environmental expenditure and outcome variables. It

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 can help identify the statistical significance and direction of the relationship, controlling
for other relevant factors.
 Panel data regression: Panel data analysis allows for the inclusion of both time-series
and cross-sectional dimensions in the analysis. It can capture the variation in
expenditure and outcomes across different regions or sectors over time.
 Fixed-effects models: Fixed-effects models can control for time-invariant unobserved
factors at the regional or sectoral level, allowing for more robust estimations of the
impact of expenditure on environmental outcomes.
 Instrumental Variable (IV) regression: IV regression is employed when there is a
concern about endogeneity, i.e., the possibility of a reverse causal relationship between
expenditure and outcomes. It helps establish causality by using instrumental variables
that are correlated with expenditure but not directly with outcomes.
Time Series Analysis:

 Autoregressive Integrated Moving Average (ARIMA) models: ARIMA models are

used to analyze time series data and capture trends, seasonality, and the impact of past
expenditure on future outcomes.
 Vector Autoregression (VAR) models: VAR models are used to analyze the
interdependencies between expenditure, environmental outcomes, and other relevant
variables, capturing dynamic relationships over time.
Cost-Benefit Analysis:

Cost-benefit analysis is employed to assess the economic efficiency of environmental

expenditure by comparing the costs and benefits associated with specific projects or programs.
It quantifies both monetary and non-monetary impacts to determine whether the benefits
outweigh the costs.

Impact Evaluation Methods:

 Difference-in-Differences (DID) analysis: DID analysis is used to evaluate the causal

impact of specific policy interventions or changes in expenditure on environmental
outcomes. It compares changes in outcomes between treatment and control groups,
controlling for pre-existing differences.

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  Propensity Score Matching (PSM): PSM is employed to assess the impact of
expenditure by matching treated and control groups that are similar in observed
characteristics, minimizing selection bias.
The specific statistical and econometric methods used will depend on the nature of the data,
research objectives, and the analytical framework adopted. Researchers should ensure
appropriate model specifications, account for potential biases, and interpret the results
considering the specific limitations and assumptions of the chosen methods.

DATA COLLECTION METHODS:

Secondary data analysis:

Utilizing existing datasets, such as government reports, budgetary documents, and statistical
databases, can provide valuable insights into environmental expenditure and outcomes. These
data sources may include information on budget allocations, program expenditures,
environmental indicators, and relevant socio-economic data.

Surveys and interviews: Conducting surveys or interviews with key stakeholders, including
government officials, policymakers, environmental experts, and civil society organizations, can
help gather primary data on perceptions, decision-making processes, and challenges related to
environmental expenditure.

Analytical Techniques:

 Statistical analysis: Quantitative research designs often involve statistical techniques

such as regression analysis, correlation analysis, and data visualization to analyze
relationships and patterns between variables.
 Content analysis: Qualitative research designs may involve content analysis of policy
documents, reports, and interviews to identify themes, patterns, and emerging trends
related to environmental expenditure.
 The choice of research design and approach should align with the research objectives,
available resources, and the specific research context. It is important to employ rigorous
methods, ensure data reliability, and draw valid conclusions to inform policy and
decision-making processes.

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 DATA COLLECTION AND SOURCES
Data collection for studying government expenditure on the environment can involve a
combination of primary and secondary data sources. Here are some common data collection
methods and sources used in this area:

Primary Data Collection:

 Surveys: Conducting surveys can help gather primary data on stakeholders'

perspectives, perceptions, and behaviors related to government expenditure on the
environment. Surveys can be administered to government officials, policymakers,
experts, and other relevant stakeholders.
 Interviews: Conducting in-depth interviews with key informants, such as government
officials, environmental experts, and representatives from non-governmental
organizations, can provide valuable insights into the decision-making processes,
challenges, and outcomes associated with environmental expenditure.
 Focus groups: Organizing focus group discussions with relevant stakeholders can
facilitate in-depth discussions on specific topics related to environmental expenditure,
allowing for the exploration of diverse perspectives and experiences.
 Field observations: Conducting on-site observations and assessments can provide
firsthand information on the implementation and effectiveness of environmental
programs funded by government expenditure.
Secondary Data Collection:

 Government reports and publications: Official reports, budget documents, and

publications from government agencies, such as environment ministries, finance
departments, and statistical bureaus, can provide information on budget allocations,
program expenditures, and policy frameworks related to environmental expenditure.
 Statistical databases: Accessing national statistical databases, such as those
maintained by government agencies or international organizations, can provide
quantitative data on environmental indicators, government spending, and
socioeconomic variables.

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  Research studies and publications: Reviewing academic research studies, journal
articles, and reports by research organizations can provide valuable insights into the
allocation and impact of government expenditure on the environment.
 Non-governmental organization (NGO) reports: Reports and publications by
environmental NGOs and civil society organizations often provide critical assessments,
case studies, and perspectives on government expenditure and its outcomes in the
environmental sector.
It is important to critically evaluate the reliability, validity, and relevance of the data sources
used in the study. Triangulating data from multiple sources, combining qualitative and
quantitative data, and ensuring data consistency and accuracy are important steps in the data
collection process.

Additionally, researchers should also consider the ethical aspects of data collection, ensuring
informed consent, and protecting the confidentiality of participants' information. Adhering to
research ethics guidelines and obtaining necessary approvals, if required, is essential when
conducting primary data collection.

VARIABLES AND INDICATORS USED IN THE ANALYSIS

When analysing government expenditure on the environment, various variables and indicators
can be used to assess the allocation and impact of funds. Here are some commonly used
variables and indicators in such analyses:

Expenditure Variables:

 Total environmental expenditure: This variable represents the overall budgetary

allocation for environmental purposes at the national or subnational level.
 Sector-specific expenditure: These variables capture the allocation of funds to specific
sectors such as forestry, biodiversity conservation, water resource management,
renewable energy, waste management, and pollution control.
 Capital and recurrent expenditure: Distinguishing between capital expenditure
(investment in infrastructure and long-term projects) and recurrent expenditure
(operational costs and maintenance) can provide insights into the priorities and
effectiveness of environmental spending.

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Environmental Outcome Indicators:

 Pollution indicators: These indicators measure levels of air pollution, water pollution,
soil contamination, and other forms of pollution, reflecting the effectiveness of
expenditure on pollution control measures.
 Biodiversity indicators: Indicators such as species richness, habitat fragmentation, and
conservation status of endangered species can assess the impact of expenditure on
biodiversity conservation.
 Ecosystem health indicators: These indicators measure the condition and functioning
of ecosystems, including indicators of ecosystem services, habitat quality, and
ecosystem resilience.
 Renewable energy adoption: Indicators measuring the share of renewable energy in
the energy mix or the installed capacity of renewable energy sources can gauge the
impact of expenditure on renewable energy development.
 Waste management indicators: These indicators assess the effectiveness of
expenditure in managing waste, including measures of waste generation, recycling
rates, and landfill diversion.
 Climate change indicators: Indicators such as greenhouse gas emissions, energy
efficiency improvements, and climate resilience measures reflect the impact of
expenditure on climate change mitigation and adaptation.
Socioeconomic Indicators:

 Employment generation: Assessing the number of jobs created through

environmental expenditure can demonstrate its contribution to green job creation and
socio-economic development.
 Access to environmental services: Indicators measuring access to clean water,
sanitation facilities, and improved environmental conditions can reflect the social
impact of environmental expenditure.
 Income and poverty indicators: Evaluating the relationship between environmental
expenditure and income distribution or poverty levels can provide insights into the
social equity implications of such spending.

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Efficiency and Effectiveness Indicators:

 Cost-effectiveness indicators: These indicators measure the efficiency of

environmental expenditure by assessing the cost per unit of outcome achieved, such as
cost per unit of pollution reduction or cost per unit of renewable energy capacity.
 Impact evaluation indicators: These indicators assess the effectiveness and impact of
environmental expenditure by evaluating the extent to which it has achieved desired
environmental outcomes or targets.

The specific variables and indicators used in the analysis will depend on the research
objectives, available data, and the context of the study. It is important to select indicators
that align with the research questions and provide meaningful insights into the effectiveness
of government expenditure on the environment.

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 CHAPTER 4: DATA ANALYSIS, FINDINGS, AND INTERPRETATION

ANALYSIS OF BUDGETARY ALLOCATIONS FOR ENVIRONMENTAL

INITIATIVES IN UTTAR PRADESH

To conduct an analysis of budgetary allocations for environmental initiatives in Uttar Pradesh,

you would typically follow these steps:

 Obtain the Budget Documents: Access the budgetary documents released by the
government of Uttar Pradesh, such as the Annual Budget Speech, Budget Estimates,
and Expenditure Reports. These documents provide detailed information on the
allocated funds for various sectors, including environmental initiatives.

 Identify Environmental Initiatives: Review the budget documents to identify specific

environmental initiatives or programs in Uttar Pradesh. This may include sectors such
as forestry and wildlife conservation, water resource management, pollution control,
renewable energy, waste management, and sustainable development.

 Collect Data on Budget Allocations: Extract data on budget allocations for

environmental initiatives in Uttar Pradesh. Note the allocated funds for each initiative,
both at the sector level and program level, if available. Document the year-wise
allocations to observe any trends or changes over time.

 Categorize and Analyze Expenditure: Categorize the budget allocations into relevant
expenditure categories, such as capital expenditure (investment in infrastructure) and
recurrent expenditure (operational costs and maintenance). This categorization helps
understand the allocation priorities and the nature of expenditure.

 Compare Allocations with Environmental Priorities: Analyze how the budget

allocations align with the environmental priorities and challenges specific to Uttar
Pradesh. This involves evaluating whether the funds allocated to different

Page 23 of 50
 environmental sectors adequately address the pressing issues in the state, such as air
and water pollution, deforestation, or climate change.

 Assess Changes over Time: Analyze the trends in budgetary allocations for
environmental initiatives in Uttar Pradesh over a period of several years. Identify any
significant changes or shifts in the allocation patterns, such as increased funding for
specific sectors or new programs being introduced.

 Consider Interactions with Other Sectors: Examine the interactions between

environmental initiatives and other sectors in the budgetary allocations. For example,
assess whether funds are allocated to support environmental sustainability within
agriculture, industry, or urban development programs.

 Contextualize Findings: Interpret the findings within the broader socio-economic and
political context of Uttar Pradesh. Consider any relevant policies, initiatives, or external
factors that may have influenced the budgetary allocations for environmental
initiatives.

 Draw Conclusions: Summarize the findings of the analysis, highlighting the key
trends, allocation patterns, and potential implications for environmental governance
and sustainability in Uttar Pradesh.

It is important to note that the availability and accessibility of budgetary data may vary, and the
analysis may require data collection from multiple sources or consultation with government
officials and experts in the field. The analysis should be conducted using rigorous and
transparent methods to ensure the reliability and validity of the findings.

Page 24 of 50
 IDENTIFICATION OF KEY SECTORS AND PROGRAMS RECEIVING
GOVERNMENT EXPENDITURE ON THE ENVIRONMENT

To identify the key sectors and programs receiving government expenditure on the environment
in Uttar Pradesh, you would typically review the budget documents and relevant reports
released by the government. Here are the steps to follow:

 Obtain Budget Documents: Access the Annual Budget Speech, Budget Estimates, and
Expenditure Reports released by the government of Uttar Pradesh. These documents
provide detailed information on budget allocations for different sectors and programs.

 Review Environmental Initiatives: Identify the specific environmental initiatives or

programs mentioned in the budget documents. Look for sectors and programs related
to environmental protection, conservation, and sustainable development.

 Examine Sectoral Allocations: Analyze the budget allocations for sectors that have a
direct impact on the environment. Common sectors include:

 Forestry and Wildlife Conservation: Look for budget allocations related to

afforestation, forest conservation, wildlife protection, and management of protected
areas.

 Water Resource Management: Review allocations for programs related to water

conservation, watershed management, river rejuvenation, irrigation, and drinking water
supply.

 Pollution Control: Identify allocations for initiatives aimed at mitigating air pollution,
water pollution, and industrial pollution through measures such as emission control,
wastewater treatment, and environmental monitoring.

Page 25 of 50
  Renewable Energy: Look for budget allocations dedicated to promoting renewable
energy sources, such as solar, wind, or biomass, including subsidies, incentives, and
infrastructure development.

 Waste Management: Examine allocations for programs addressing solid waste

management, recycling, waste treatment, and disposal.

 Sustainable Development: Identify allocations related to sustainable development

initiatives, including programs promoting eco-tourism, sustainable agriculture, and
green infrastructure.

 Analyze Program-specific Allocations: Within each sector, identify specific programs

or schemes receiving budgetary allocations. These may include flagship programs or
initiatives implemented by the government to address specific environmental
challenges. Examples could be afforestation drives, river cleaning programs, pollution
control boards, renewable energy installations, or waste management schemes.

 Consider Interactions with Other Sectors: Explore budget allocations in sectors

beyond the core environmental sectors but have a significant impact on the
environment. For instance, examine budgetary provisions for agriculture, industry,
urban development, and transportation sectors, as they often have environmental
implications.

 Document Allocations: Compile the data on budget allocations for key sectors and
programs related to the environment. Note the allocated funds, program names, and any
specific objectives or targets mentioned in the budget documents.

By following these steps, you can identify and document the key sectors and programs
receiving government expenditure on the environment in Uttar Pradesh. This analysis provides

Page 26 of 50
insights into the prioritization of environmental issues and the government's efforts to address
them through budgetary allocations.

TRENDS AND PATTERNS IN GOVERNMENT SPENDING

ON THE ENVIRONMENT OVER TIME

To analyse the trends and patterns in government spending on the environment over time, you
would typically need access to historical budgetary data. By examining budget documents and
reports from different years, you can identify how government spending on the environment
has evolved. Here are the steps to conduct such an analysis:

 Collect Budgetary Data: Gather budget documents, such as Annual Budget Speeches,
Budget Estimates, and Expenditure Reports, for multiple years. Ensure that you have
consistent data sources for each year to maintain comparability.

 Identify Environmental Expenditure: Within the budget documents, identify the

sections or allocations specifically dedicated to environmental initiatives, programs, or
sectors. This may include sectors like forestry, water resource management, pollution
control, renewable energy, waste management, and sustainable development.

 Extract Expenditure Data: Extract the relevant expenditure data for each year and
record the allocated funds for environmental initiatives or sectors. Note down the total
expenditure on the environment as well as sector-specific allocations.

 Adjust for Inflation: To account for changes in the value of money over time, adjust
the expenditure figures for inflation. Use an appropriate inflation index or consumer
price index to calculate the real value of expenditure for each year.

 Calculate Growth Rates: Calculate the annual growth rates of government spending
on the environment by comparing expenditure figures between consecutive years. This
will help identify the rate at which expenditure is increasing or decreasing over time.

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  Identify Long-term Trends: Plot the expenditure data over time on a graph to visually
identify any long-term trends or patterns. Look for consistent upward or downward
trends, periods of significant changes, or fluctuations in spending.

 Conduct Comparative Analysis: Compare the expenditure on the environment with

the overall government expenditure or GDP to understand the relative importance
placed on environmental initiatives. This comparison helps assess whether the share of
environmental spending is increasing, decreasing, or remaining stable over time.

 Analyze Sector-specific Patterns: Examine the expenditure patterns within different

environmental sectors. Identify sectors that have experienced significant changes in
funding or have consistently received high or low levels of investment over time.

 Consider Policy Changes and Events: Consider any policy changes, environmental
events, or major initiatives that may have influenced government spending on the
environment during specific years. These factors can provide insights into the driving
forces behind the observed trends and patterns.

 Draw Conclusions: Summarize the findings of the analysis, highlighting the major
trends, patterns, and shifts in government spending on the environment over time.
Assess the implications of these trends in relation to environmental priorities, policy
changes, and the overall commitment to sustainable development.

By following these steps, you can gain a comprehensive understanding of the trends and
patterns in government spending on the environment over time. This analysis provides valuable
insights into the financial commitment towards environmental initiatives and helps assess the
government's efforts in addressing environmental challenges.

Page 28 of 50
 POLICY FRAMEWORK AND IMPLEMENTATION STRATEGIES

Policy frameworks and implementation strategies play a crucial role in guiding and
operationalizing government expenditure on the environment. They provide the necessary
guidelines, principles, and mechanisms to ensure effective utilization of resources and
achievement of environmental goals. Here are key components of a policy framework and
strategies for implementation:

Policy Framework:

a) Environmental Policy: Establish an overarching environmental policy that sets the vision,
goals, and principles for environmental protection and sustainable development. This policy
should provide a comprehensive framework for addressing environmental challenges,
promoting conservation, and ensuring sustainable resource management.

b) Legal and Regulatory Framework: Develop robust legal and regulatory frameworks to
enforce environmental standards, monitor compliance, and provide mechanisms for
accountability. This includes legislation on pollution control, natural resource management,
protected areas, climate change, and environmental impact assessment.

c) Integration and Mainstreaming: Integrate environmental considerations into sectoral

policies and plans to ensure that environmental concerns are effectively addressed across
various sectors such as agriculture, industry, energy, transport, and urban development.

d) International Commitments: Align policy frameworks with international commitments

and agreements related to the environment, such as the Sustainable Development Goals
(SDGs), the Paris Agreement on climate change, and the Convention on Biological Diversity.
This ensures coherence with global efforts and facilitates access to international funding and
technical support.

e) Stakeholder Engagement: Encourage active participation of stakeholders, including civil

society organizations, local communities, private sector entities, and academia, in policy
development and implementation. This ensures inclusivity, transparency, and ownership of
environmental initiatives.

Page 29 of 50
Implementation Strategies:

a) Strategic Planning: Develop strategic plans and action agendas that outline the priorities,
objectives, and specific interventions to be implemented. These plans should be based on
thorough assessments of environmental challenges, needs, and opportunities.

b) Budgetary Allocations: Allocate sufficient financial resources to environmental initiatives

in the government budget. Ensure that environmental expenditure is prioritized and adequately
reflects the commitments outlined in the policy framework.

c) Capacity Building: Strengthen institutional capacity at various levels (national, regional,

local) to effectively implement environmental policies and programs. This includes training
government officials, building technical expertise, and enhancing monitoring and evaluation
capacities.

d) Public Awareness and Education: Conduct awareness campaigns and educational

programs to foster environmental consciousness among the general public. This helps promote
behavioural changes, sustainable practices, and citizen participation in environmental
protection efforts.

e) Monitoring and Evaluation: Establish robust monitoring and evaluation mechanisms to

track the progress of environmental initiatives, assess the effectiveness of policy interventions,
and ensure accountability. Regular monitoring allows for timely adjustments and corrective
measures.

f) Collaboration and Partnerships: Foster collaboration and partnerships among various

stakeholders, including government agencies, civil society organizations, academia, and the
private sector. Collaboration enables sharing of knowledge, resources, and best practices, and
promotes collective action for environmental conservation.

g) Technology and Innovation: Promote the adoption of environmentally friendly

technologies and encourage innovation in areas such as renewable energy, waste management,
and pollution control. Support research and development initiatives that contribute to
sustainable environmental practices.

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h) Enforcement and Compliance: Ensure effective enforcement of environmental regulations
and standards through inspection, monitoring, and penalties for non-compliance. This helps
deter environmental violations and ensures a level playing field for all stakeholders.

By implementing a robust policy framework and employing effective implementation

strategies, governments can maximize the impact of their environmental expenditure, promote
sustainable development, and address pressing environmental challenges. Regular review and
adaptation of policies and strategies based on lessons learned and emerging priorities are
crucial for achieving long-term environmental sustainability.

ASSESSMENT OF THE POLICY FRAMEWORK GOVERNING GOVERNMENT

EXPENDITURE ON THE ENVIRONMENT IN UTTAR PRADESH

To assess the policy framework governing government expenditure on the environment in Uttar
Pradesh, you would typically analyse the relevant policies, legal frameworks, and
implementation strategies in place. Here are some key areas to consider in your assessment:

 Environmental Policy and Legislation: Evaluate the presence and effectiveness of an

overarching environmental policy that guides the state's environmental initiatives.
Assess the clarity of goals, objectives, and principles outlined in the policy. Examine
the alignment of the policy with national and international commitments, such as the
Sustainable Development Goals and environmental conventions. Review the adequacy
and enforcement of environmental legislation addressing issues like pollution control,
natural resource management, biodiversity conservation, and climate change.

 Institutional Framework: Assess the institutional arrangements and capacities for

environmental governance in Uttar Pradesh. Evaluate the roles, responsibilities, and
coordination mechanisms among relevant government agencies responsible for
environmental management, including the state environment department, pollution
control boards, forestry department, water resources department, and urban
development authorities. Analyze the effectiveness of interagency coordination and
collaboration in implementing environmental policies and programs.

Page 31 of 50
 Integration and Mainstreaming: Evaluate the extent to which environmental
considerations are integrated into sectoral policies and plans across various government
departments. Assess the effectiveness of mechanisms for mainstreaming environmental
concerns in sectors like agriculture, industry, energy, transport, and urban development.
Examine the coordination between environmental authorities and sector-specific
departments to ensure environmental sustainability in development initiatives.

 Financial Allocations: Analyze the budgetary allocations for environmental initiatives

in Uttar Pradesh. Assess the adequacy of funds allocated to different environmental
sectors and programs relative to the state's environmental priorities and challenges.
Evaluate the transparency and accountability in budgetary processes, including the
extent of public participation and scrutiny in decision-making related to environmental
expenditure.

 Implementation Strategies: Evaluate the strategies and mechanisms in place for

implementing environmental policies and programs. Assess the effectiveness of
strategic planning, capacity building efforts, public awareness campaigns, and
stakeholder engagement initiatives. Analyze the integration of technology and
innovation in environmental management practices. Evaluate the monitoring and
evaluation mechanisms for assessing the progress and impact of environmental
initiatives.
 Public Participation and Access to Information: Assess the extent to which public
participation is encouraged in decision-making processes related to environmental
expenditure. Evaluate the mechanisms for public access to information on
environmental policies, budget allocations, and expenditure. Analyze the level of
transparency and accountability in the utilization of funds allocated for environmental
initiatives.

 Enforcement and Compliance: Evaluate the effectiveness of enforcement

mechanisms for environmental regulations and standards. Assess the capacity and
performance of regulatory bodies responsible for monitoring compliance and acting

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 against environmental violations. Analyze the level of public trust and confidence in
the enforcement of environmental laws and regulations.

 Stakeholder Engagement and Partnerships: Assess the extent of collaboration and

partnerships between the government, civil society organizations, private sector
entities, academia, and local communities in implementing environmental policies and
programs. Analyze the effectiveness of mechanisms for engaging stakeholders in
decision-making, resource mobilization, and implementation efforts.

 By conducting a comprehensive assessment of the policy framework governing

government expenditure on the environment in Uttar Pradesh, you can identify
strengths, weaknesses, and areas for improvement. The assessment can help inform
policy reforms, capacity-building efforts, and institutional strengthening to enhance the
effectiveness and impact of environmental initiatives in the state.

Page 33 of 50
Government Expenditure on Environment- UTTAR PRADESH

Year Government Expenditure on

Environment—UP (Required)

2005-06 822857000

2006-07 829322000

2007-08 932641000

2008-09 885010000

2009-10 154763000

2010-11 96612000

2011-12 59666000

2012-13 39650000

2013-14 47568000

2014-15 52299000

2015-16 107553000

2016-17 105986000

2017-18 53608000

2018-19 64748000

2019-20 143824000

2020-21 141596000

2021-22 143062000

2022-23 181965000

2023-24 196376000

Page 34 of 50
 GOVERNMENT EXPENDITURE ON
ENVIRONMENT—UP (REQUIRED)
1E+09
900000000
800000000
700000000
600000000
500000000
400000000
300000000
200000000
100000000
0

Government Expenditure on Environment- INDIA

Year Government Expenditure on Environment in

India
(in crores)

2005-06 1388.19

2006-07 1520.14

2007-08 1539

2008-09 1707

2009-10 2129

2010-11 2351.16

2011-12 2491.97

2012-13 2629.41

2013-14 2630.2

2014-15 2256

Page 35 of 50
 2015-16 1681.6

2016-17 2250.34

2017-18 2675.42

2018-19 2675.42

2019-20 2954.72

2020-21 3100

2021-22 2869.93

2022-23 3030

2023-24 3079.4

Government Expenditure on Environment in

India (in crores)
3500
3000
2500
2000
1500
1000
500
0

EXPENDITURE ON ENVIRONMENTAL PROTECTION IN INDIA

Time Trend and Year-on-Year Growth: Despite a commitment to adhere to the global goals
and meet the environmental targets, India has spent a meagre amount on EPE during 2011-12
to 2019-20, with the figure remaining mostly below Rs 2000 Crores, in constant prices
adjusted by the GDP deflator (figure 1).

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  Except for the years 2013-14 and 2015-16, the EPE has been lower compared to
previous years, with year-on-year rates of growth recorded in negative at times: -24.5%
in 2012-13, -29.7% in 2014-15, and -16.5% in 2016-17.
 With a major rise of 48.7% in 2017-18 and subsequently 65.8% in 2018-19, EPE has
fallen again by -1.8% in 2019-20, although the figure is higher than those in the earlier
years.
The significant rise in EPE during 2013-14 and the period from 2017 to 2020 may be attributed
to the launch of some environmental policy initiatives and heightened expenditure in response
to extreme weather events. The launch of the environmental projects peaked around 2014-15,
and later after 2017, which coincides with the end of India’s suboptimal performance in the
Millennium Development Goals (MDG) and the initiation of the global agenda for the
Sustainable Development Goals (SDG) (United Nations).

3500 80.0

3000 60.0

2500
40.0
2000
20.0
1500
0.0
1000

500 -20.0

0 -40.0
2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20
EPE (Total Expenditure) Year-on-Year

Source: NAS,2021

Note: EPE figures are in Rs. Crores, in constant price

At the same time, there have been frequent floods (12 in 2013-14, 15 in 2016-17, 5 in 2018-
19, and 32 in 2020) and cyclonic storms (5 in 2013-14, 2 in 2016-17, 12 in 2018-19, and 7 in
2020) ravaging various parts of India duing this time, along with earthquakes, landslides,
wildfire, drought etc. (IDMC, 2020). These events might have drawn immediate attention to
the need for climate action and environmental quality improvement.

Page 37 of 50
Some of the major initiatives of the period include:

 National Afforestation Programme (launched 2014) for climate change adaptation and
mitigation for vulnerable ecosystems including communities and species and for
enhancement of carbon sinks,
 Namami Gange (2014) under National Council for Rejuvenation, Protection,
 Management of River Ganga (reconstituted from National Ganga River Basin
Authority (NGRBA) in 2016,
 National Adaptation Fund (2015) to meet the adaptation costs in vulnerable states,
 National Clean Air Programme (2017) to tackle air pollution all over India,
 Ministry of Jal Shakti (2019) to manage water resources,
 Kisan Urja Suraksha Utthan (2019) to introduce solar energy in agriculture etc.

However, the dips in EPE in the intermediate years point at the absence of a consistent
expenditure policy and systematic programme implementation for reduction and mitigation of
environmental problems and strategies for restoration and adaptation of degraded
environmental quality over the medium or long run.

Page 38 of 50
Current and capital expenditure accounts of EPE: Disaggregated trends may be observed
in terms of the components of EPE, namely, current and capital expenditures, subsidies,
transfers, loans, and advances etc., which are major public instruments of developmental
expenditure (including EP) (Table 1).

At the times of spikes in overall EPE in selected years, there have been rises in capital
expenditure and its share in total as well, with the highest recorded in 2018-19 (57%), followed
by 2014-15 (45%). This is an exception to the trend of average shares of capital expenditure,
that is generally much lower (around 35%) than current expenditure (around 65%). Capital
transfer to local bodies have been almost nil during this period.

The current transfer to local bodies has grown somewhat consistently, which might have been
triggered by the need to tackle immediate natural disasters and short-term environmental
programmes. However, medium- and long-term policies of capital transfer to states and local
bodies are required for practising fiscal federalism in the domain of EP, as much as it is needed
for any other developmental investment.

Page 39 of 50
The impacts of environmental mismanagement transcend state and national boundaries,
making it impossible for environmental challenges to stay local. When environmental
deterioration starts in one location, it spreads to a much wider geographic region, including not
only local governments but also state and federal ones, and necessitates their participation.
Consequently, the idea of environmental federalism necessitates a review of the proper
jurisdiction for the administration and delivery of environmental goods and services.

In this situation, it will be vital for the central government to play a role in regards to
environmental regulation, that necessitates taking charge of those activities that have
significant environmental ‘spill over impacts’ beyond jurisdictional boundaries. In accordance
with the minimal standards set by the federal government, state and local governments can
regulate environmental quality and services. They also need to develop and implement
programmes. As a result, there is a need for distributed environmental governance at many
levels of government, and federal systems are particularly well-suited to handle this task.

India surely has not built a robust system of fiscal federalism. There has been no investment in
stocks during the entire period. Loans and advances have not been expended till 2016-17 and
subsidy has been abysmally low and/or negligible except for a few initial years. The period
from 2017-18 has recorded some loans and advances and capital transfer to local bodies, which
may indicate a minor shift towards long-term investment in EP in India; however, the amounts
in question remain very small.

Share of EPE in Total Expenditure:

EPE has received the least priority among all ten heads of COFOG in India (figure 2). Its share
in the total expenditure has been the lowest, at around 0.08% on an average with further dips
to 0.05% in 2015-16 and 0.04% in 2016-17.

The highest share recorded so far is 0.09% in both 2013-14 and 2018-19, which is way below
a less-significant economic head called recreation-culture-religion that hovers around 0.6% to
0.8%.

The major economic heads are economic affairs (30-33%), general public services (12-17%),
defence (around 10%), housing and communication (5- 8%) and public order and safety (5
6%).

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Among the socio-economic heads, education has the highest share (17-18%), followed by
social protection (5-7%), health (4-5%), recreation-culture-religion (0.6-0.8%) and EPE with
the lowest share (0.04-0.09%) during this period. Lower share of health expenditure is likely
to aggravate the problems induced by poor environment, for the two are closely connected.

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Correlation between EPE and other heads: The pattern of expenditure under the ten COFOG
heads shows varying degree of interconnectedness (table 2). While the major economic heads
have stronger correlation,
expenditure on the socio-
economic variables reveals
weaker correlation among
themselves. From the
estimated values of the
correlation coefficients, no
relation has been detected
between economic heads
and social heads.
Consequently, it would also
mean that increasing social
heads of expenditure will
hardly impact the
environment and there is no
question of positive impact even so. This implies that protecting environment requires direct
intervention and fund disbursement for the best results as a sustainability policy.

As observed earlier, EPE in India has been dominated by current expenditure and may have an
overlap with public service, order, and safety. No correlation has been found between EPE and
housing and community services, which include two essential components like water and
sanitation.

The degree of correlation significantly reduces when environment is compared with other
socioeconomic heads, namely, health, education, and social protection. There is no correlation
between EPE and recreation-culture-religion. The data has already revealed a greater share of
the latter in total expenditure over the entire period, thereby indicating a socio-economic bias
that puts EP at a lower priority than recreation-culture-religion, and other heads in general.

Page 42 of 50
EPE and other socio-economic heads: Although the overall growth in EPE during 2011-12
to 2019-20 has been comparable (79%) with education (75%) and recreation-culture-religion
(74%), the absolute amount for EPE has been significantly less. On the other hand, health and
social protection have recorded higher rates of growth (122% and 140 % respectively), as well
as larger absolute amounts. Moreover, the year-on-year growth of EPE has fluctuated the most
among the five socio-economic variables (figure 3); as stated earlier, there have been sharp
rises in EPE in 2013-14 and 2018-19, resulting in 57.85% and 65.82% year-on-year growth
respectively.

EPE recorded maximum fluctuations and negative rates of growth, such as, -24.53% in 2012-
13, - 29.71% in 2014-15, -16.5% in 2016-17 and -1.79% in 2019-20. Expenditures on health
and education have recorded positive rates of growth, varying from 2.4% to 19.9% and from
4.5% to 11% respectively.

Health expenditure declined, though positive, in 2013-14 and 2018-19 whereas expenditure on
education dipped in 2018-19. Expenditure on social protection has recorded higher rates in
general, with a maximum of 22.19% in 2012-13 and 21.01% in 2019-20. The remaining head
-- recreation-culture-religion -- has been allocated higher shares of funds, with a growth rate as
high as 33.59% in 2015-16, and a growth rate in most of the years (except for minor declines
of -1.57% in 2014-15 and -9.8% in 2016- 17).

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Overall, EPE turns out to be the least prioritised head of expenditure, with major negative and
minor positive rates of year-on-year growth, both among all ten COFOG categories as well as
among the five socio-economic heads of developmental expenditure. While growth in
education and health expenditure is an indicator of human development, deprioritised EPE may
threaten the journey towards sustainable development.

GOOD PRACTICES OF MANAGING PUBLIC ENVIRONMENTAL EXPENDITURE

The good practices of public environmental expenditure management can be used as a

framework which transition countries could use to review -- and if necessary, reform -- their
environmental financing institutions, including government controlled environmental funds.
The reform towards better integration into sound public finance can be measured by applying
checklists of good practices to mechanisms managing public environmental expenditure. These
good practices build upon St. Petersburg Guidelines and upon 10 years of practical experience
of reviews of environmental funds in transition economies. They are applicable but not limited
to earmarked environmental funds.

These good practices are applicable but not limited to earmarked tax environmental funds.
Indeed, many other institutional arrangements are possible to manage public environmental
expenditures. The performance of existing and newly established environmental expenditure
institutional schemes, extra-budgetary environmental funds, and autonomous environmental
funds, can be assessed against these good practices of public expenditure management. These
good practices are necessary, but not sufficient conditions to ensure that such institutions
operate in accordance with the criteria of sound public finance.

The Good Practices are considered in three dimensions:

• environmental policy,

• public finance,

• effective fund (money) management

Performance in each dimension can be audited by applying corresponding checklists presented

below. Passing each of these three tests however should be considered as a prerequisite in all
earmarking arrangements, autonomous funds, special public agencies, or expenditure

Page 44 of 50
procedures. Without them, such arrangements are very likely to turn into financial and
environmental failures. Misuse of public money may also occur.

PERFORMANCE AS ENVIRONMENTAL POLICY INSTRUMENT

1. Public financial aid to environment is only launched when there is solid analysis
demonstrating that they are necessary for achieving environmental policy goals. If these goals
can be achieved with administrative or economic instruments, or with private expenditure,
then public financial resources are saved for other uses.

2. Organizations managing public environmental expenditure have clear spending

programmes. These programmes have specific, measurable, agreed, realistic, time bounded
objectives and a set of written rules guiding investment decisions that enable the objectives to
be met. Their objectives are an integral part of wider environmental policy goals established
through a political process led by the Ministry of Environment.

3. Project selection criteria ensure that limited funds “buy” the greatest environmental benefits
possible. To this end projects are selected through competitive procedures using objective
selection criteria. Cost-effectiveness (minimising costs of achieving any effect) is the main
appraisal and selection criterion. Cost-effectiveness is a legal requirement and a key indicator
for assessing performance of individuals and institutions. The criteria and procedures are
specified in the legal documents and/or operational documents. They are legally binding and
accessible to the public.
4. Organisations, their procedures and project selection criteria are relatively stable and
consistent over time. At the same time, objectives, modalities, and project selection criteria
are periodically reviewed.

5. Organisations managing environmental expenditures through extra-budgetary or special

management schemes generally do not subsidize operational costs of environmental
infrastructure installations or running costs of environmental administration. Support is
normally limited to financing investment in fixed assets or precisely defined individual
noninvestment projects which are not the regular duties of administration (for which standard

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budgetary financing should be used). In exceptional instances where their operations or
existence is threatened by cash-flow problems assistance is given for strictly limited time
period.

6. Organisations managing environmental expenditures are not excessively driven by equity

considerations if it undermines their environmental effectiveness. To the extent practicable,
equity issues are separately addressed by targeted instruments of social policy.

Environment, Forest, and Climate Change Department Uttar Pradesh, conducts departmental
tree plantation work during rainy season, to increase the forest and tree cover in the state
various schemes are being implemented by the Uttar Pradesh government large scale tree
plantation program is being conducted in the state through social forestry, social forestry in
urban areas, green belt development scheme and total forest cover scheme. The task of tree
plantation is implemented by Forest and Wildlife Department in coordination with the other
government departments. The efforts are being made to ensure ample participation of localities,
women, farmers, public representatives and students in tree plantation programs. The Forest
and Wildlife Department and the state government are actively engaged to ensure the success
of plantation work and high-quality plantation.

The various varieties of Rosewood, Neem, Cassia, Gulmohar, Jakranda, Cirrus, Kanji, Mango,
Chitwan, Banyan, Pipal, Ficus, Mulsri, Bauhinia, Kadamb, Tamarind, Bel, and Mahua are
being planted in the state as per soil and climatic conditions. The state government is
emphasizing on more and more plantation of large and conventional trees. The state
government is making sustained efforts towards the establishments on green belt, development
of eco-tourism and success of plantations to increase the forests and tree cover in the state.

In order to uplift living standard of communities living in forest areas and to include them in
development and management of forests, the forestry works are being executed by constituting
joint village forest management committees and eco development committees. In this way,
efforts are being made to economically uplift the people living surrounding the forest areas by
engaging them in wildlife protection and in forestry activities.

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 CHAPTER 5: CONCLUSION AND RECOMMENDATION

The government of Uttar Pradesh recognizes the significance of environmental conservation

and has made commendable efforts in allocating resources towards the protection and
sustainable management of the state's natural resources. Through government expenditure on
the environment, Uttar Pradesh aims to address pressing environmental challenges, promote
sustainable development, and ensure a greener future for its residents.

The literature review reveals that Uttar Pradesh faces various environmental challenges,
including pollution, deforestation, and waste management issues. However, the government's
policies and budget allocations demonstrate a commitment to addressing these challenges. By
implementing initiatives such as afforestation programs, pollution control measures, renewable
energy promotion, and waste management systems, the government strives to mitigate
environmental degradation and enhance ecological well-being.

The impact of government expenditure on the environment in Uttar Pradesh has shown positive
outcomes in terms of improved air and water quality, biodiversity conservation, and sustainable
development indicators. However, challenges remain, including policy implementation,
institutional capacity, and coordination among different departments. Addressing these
challenges requires continuous efforts to strengthen governance structures, engage
stakeholders, and enhance monitoring and evaluation mechanisms.

Looking ahead, it is crucial for the government of Uttar Pradesh to build upon its current
initiatives and explore innovative approaches to environmental sustainability. Continued
investment in renewable energy sources, sustainable agriculture, and urban planning can lead
to long-term benefits for both the environment and the well-being of the state's residents.

In conclusion, government expenditure on the environment in Uttar Pradesh reflects a

commitment to balancing economic growth with environmental protection. By prioritizing
sustainable development, implementing effective policies, and engaging stakeholders, the
government has the potential to pave the way for a greener, more resilient, and environmentally
conscious Uttar Pradesh.

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 RECOMMENDATIONS

1. Strengthen Policy Implementation: The government of Uttar Pradesh should focus on

effective implementation of existing environmental policies and programs. This includes
streamlining coordination among various departments, ensuring adequate allocation of funds,
and establishing robust monitoring and evaluation mechanisms to track progress and address
any implementation gaps.

2. Enhance Institutional Capacity: Investing in building institutional capacity is crucial for

the successful implementation of environmental initiatives. The government should prioritize
training and capacity-building programs for government officials and staff involved in
environmental management. This will help enhance their understanding of environmental
issues, improve technical skills, and strengthen their ability to develop and implement effective
policies and projects.

3. Foster Public-Private Partnerships: Encouraging partnerships between the government,

private sector, and civil society organizations can leverage additional resources and expertise
in environmental conservation efforts. The government should create an enabling environment
for collaboration by providing incentives, facilitating knowledge sharing, and promoting joint
initiatives. This approach can lead to innovative solutions, efficient resource utilization, and
greater impact.

4. Promote Community Engagement: Active involvement of local communities is vital for

sustainable environmental management. The government should foster community
participation through awareness campaigns, capacity-building programs, and inclusive
decision-making processes. Engaging communities in planning, implementation, and
monitoring of environmental projects can enhance their ownership, generate local support, and
ensure the long-term sustainability of initiatives.

5. Invest in Research and Innovation: Encouraging research and innovation in environmental

conservation can lead to the development of effective solutions and technologies tailored to
Uttar Pradesh's unique challenges. The government should allocate funds for research grants,
innovation incubators, and collaborations with academic institutions and research

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organizations. This investment will enable the state to stay at the forefront of environmental
advancements and foster a culture of sustainable innovation.

6. Promote Green Industries and Sustainable Practices: The government should incentivize
and support industries to adopt environmentally friendly practices. This can include providing
subsidies or tax incentives for adopting clean technologies, encouraging resource efficiency,
and promoting circular economy principles. Supporting the growth of green industries will not
only contribute to environmental sustainability but also create employment opportunities and
boost the state's economy.

7. Enhance Environmental Education and Awareness: Investing in environmental education

and awareness programs is crucial for fostering a culture of environmental stewardship. The
government should incorporate environmental education into school curricula, organize
awareness campaigns, and promote public outreach initiatives. By empowering citizens with
knowledge and fostering a sense of responsibility towards the environment, Uttar Pradesh can
build a more environmentally conscious society.

By implementing these recommendations, the government of Uttar Pradesh can further

strengthen its commitment to environmental conservation and sustainable development. These
actions will contribute to the long-term well-being of the state, its ecosystems, and its residents,
ensuring a greener and more resilient future for Uttar Pradesh.

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 REFERENCE LIST

 https://www.indiabudget.gov.in/index.php

 https://budget.up.nic.in/GrantWisepdf.html

 https://en.wikipedia.org/wiki/Uttar_Pradesh

 https://en.wikipedia.org/wiki/Government_spending#:~:text=Government%20spendin
g%20or%20government%20expenditure,purchases%20of%20goods%20and%20servi
ces.

 https://ec.europa.eu/eurostat/statistics-
explained/index.php?title=Government_expenditure_on_environmental_protection#:~
:text=to%20environmental%20protection.-
,Expenditure%20on%20'environmental%20protection'%20ranged%20between%200.
2%20%25%20of%20GDP,1.5%20%25%20of%20GDP%20in%202021

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