Payment for Ecosystem Services

Paying farmers for ecosystem services that they provide could be a novel way to achieve multiple goals of doubling the farm incomes, reduce rural–urban migration, reduce pressure on urban infrastructure, and at the same time, incentivise sustainable agrarian practices in India.

This is a short summary of discussions of a round table organised by the Centre for Excellence in Environmental Economics, Kerala Agricultural University, Thrissur, 6–7 January 2017.

India has seen a steady decline in the proportion of national income coming from the primary sector overlaying a rapid decline in rural farm incomes and this has impacted the demographic dynamics too. Between 2001 and 2011, the growth rate of rural population declined by 5.9%, while the urban population growth rate increased by 0.3%. This steady rise has been by way of (i) migration from rural areas, (ii) increasing density of habitation spaces in urban fringes, and (iii) emergence of new towns.

The rapid growth in urban populations has put an immense strain on urban infrastructure, quality of life and raised doubts of sustainability of well-being despite a rapidly increasing per capita income in India. Parallelly, in rural India, household ownership of land has declined from 107.2 million hectares (ha) in 2002–03 to 92.4 million ha in 2012–13 (NSSO 2013). The declining farm income is reflected in the rising number of farmer suicides—an estimated 3.18 lakh farmers have committed suicide in the past 21 years beginning 1995 according to the National Crime Records Bureau. The latest estimates show that 12,602 farmers had committed suicide in 2015, an increase by 2% from 2014. Thus, guaranteeing a farm income that ensures a decent living for the farmers is an urgent need of the hour.