Data: Actual Expenditure of the ‘Environment’ ministry only 63% of the budget estimates in the pandemic year of 2020-21

• Bharath Kancharla

Like with most other ministries, the actual expenditure of the Ministry of Environment, Forests and Climate Change reduced significantly in 2020-21. The actual expenditure in 2020-21 for MoEFCC was only 63% of the initial budget estimates. Trends indicate that the actual expenditure in 2021-22 could also be lower than the initial estimates.

At the COP-26 summit held in Glasgow in November 2021, Prime Minister Narendra Modi pledged to cut  India’s total projected carbon emissions by one billion tonnes from now till 2030. India also committed to reducing the carbon intensity of the nation’s economy by more than 45% by the end of the current decade and achieving net-zero carbon emissions by 2070. 

The programs & projects of the Ministry of Environment, Forests & Climate Change (MoEFCC) are critical to achieving these commitments.  In this story, we look at the trends in budget allocation & expenditure of the MoEFCC. 

Actual Expenditure in 2020-21 was only 63% of the Budget Estimates for the year 

Prior to the COVID-19 pandemic in the country, the budget estimates for MOEFCC increased over the years. In 2016-17, the budget estimates were Rs. 2.25 thousand crores, which increased to Rs. 3.1 thousand crores by 2020-21. However, in the ensuing years starting 2021-22, the allocation was reduced to Rs. 2.86 thousand crores in 2021-22 and Rs. 3.03 thousand crores in 2022-23. 

Like with most other ministries, the actual expenditure of the ministry in 2020-21 was affected by the pandemic. Prior to that, the actual expenditure as a share of the budget estimates was higher. In 2016-17, the actual expenditure was Rs. 2.27 thousand crores, 101% of the budget estimates and around 98% of the revised estimates for the year. During 2019-20, the actual expenditure of the ministry was Rs. 2.53 thousand crores, only around 86% of the budget estimates and around 95.5% of the revised estimates. Compared to the previous years, the revised estimates were much lower than the budget estimates in 2019-20. 

The fall in the actual expenditure is more prominent in 2020-21, which was only 63% of the budget estimates for the year. The budget estimates for the year were Rs. 3.1 thousand crores, which was revised to Rs. 2.01 thousand crores because of the pandemic and the actual expenditure was still lower at Rs. 1.97 thousand crores. 

The revised estimates for 2021-22 were Rs. 2.52 thousand crores, lower than the budget estimates of Rs. 2.87 thousand crores. However, the government has increased the budget estimates for 2022-23 to Rs. 3.03 thousand crores. It remains to be seen if the revised estimates & actual expenditure get back to the pre-pandemic levels. 

Actual expenditure on Central Sector & Centrally Sponsored schemes most affected during 2020-21 

The fall in the actual expenditure in 2020-21, is primarily due to the reduction in the actual expenditure across various central sector schemes and centrally sponsored schemes.   There has been a fall in the expenditure across all different heads. 

• The initial budget estimates for establishment expenditure in 2020-21 were Rs. 671.3 crores, which were revised & reduced to Rs. 477.1 crores. The actual expenditure incurred was still lower at Rs. 452.1 crores in 2020-21, compared to the actual expenditure of Rs. 521.3 crores in 2019-20. 
• Even in the case of ‘Other Central expenditure’, there is a fall in the actual expenditure but to a lower extent. The actual expenditure for 2020-21 under this head was Rs.408.7 crores, less than the budget estimates but more than the revised estimates for the year. 
• In the case of central sector schemes, the actual expenditure was Rs. 533.8 crores i.e., only 52.5% of the budget estimates of Rs. 1017.2 crores for the year. The actual expenditure was also substantially lower than the reduced revised estimates of Rs. 584.1 crores. For context, the actual expenditure on central sector schemes in 2019-20 was Rs. 811.8 crores. For 2021-22, the revised estimates are already reduced to Rs. 800 crores compared to the budget estimates of Rs. 993 crores.
• In the case of centrally sponsored schemes, the actual transfers to the states in 2020-21 were Rs. 552.4 crores i.e., around 60% of the budget estimates for the year. In 2019-20, the actual expenditure under his head was Rs. 768 crores. The scale of reduction in the budget under this head can be understood from the fact that the revised estimates for 2020-21 were only Rs. 556 crores compared to the budget estimates of Rs.926 crores for the year. For 2021-22, the budget estimates were lower at Rs. 766 cores, which were further reduced & revised to Rs. 670 crores. The budget estimates for 2022-23 in the case of centrally sponsored schemes is higher at Rs. 930.2 crores. 

Actual expenditure for Ecology & Environment in 2020-21 is only 77% of 2019-20 

Among the major expenditure heads under MoEFCC, major spending is done is under ‘Ecology & Environment’. The actual expenditure under this head in 2019-20 was Rs. 1.04 thousand crores. The budget estimates for 2020-21 was Rs. 1.27 thousand crores, but with the pandemic, it was revised to Rs. 787.86 crores. As per the information in the latest budget, the actual expenditure for 2020-21 was only Rs. 803.52 crores.  Similarly, the actual expenditure under ‘Forestry & Wildlife’ related services in 2020-21 were Rs. 475.45 crores compared to Rs. 672.12 crores of budget estimates. 

This reduction is also reflected in the actual expenditure under major schemes in 2020-21. 

• National Coastal Mission was launched to conserve the coastal environment and to promote development & employment in coastal areas. For 2020-21, the initial budget estimates were Rs. 103 crores, which were revised & reduced to Rs. 68.3 crores because of the pandemic. The actual expenditure for the year was also the same. This amount is 75% of the actual expenditure of Rs. 91 crores in 2019-20. Although the budget estimates for 2021-22 were Rs. 200 crores, it was revised to Rs.100.9 crores. 
• The National Adaption Fund for Climate Change (NAFCC) is a central sector scheme that was launched in 2015-16 to support the adoption of activities that mitigate the adverse effects of climate change. The actual expenditure for 2020-21 was Rs. 43.1 cores, higher than the actual expenditure in 2019-20.  But it is substantially lower than the initial budget estimates of Rs. 80 crores for 2020-21. 
• The 2020-21 budget estimates under ‘Environmental Education; awareness & training’ were Rs.114.4 crores but the actual expenditure was only Rs. 50 crores. The budget estimates in the next two years were also lower at Rs. 77 crores in 2021-22 and further were lower at Rs. 58.7 crores in 2022-23. 
• 15 of the top 20 polluted cities in the world are Indian cities. Rs. 460 crores were allocated initially towards the ‘Control of Pollution’ initiative in 2020-21, but the actual expenditure in the year was Rs. 267 crores, only about 65% of the actual expenditure in 2019-20.  
• The National Mission for Green India is one of the key missions under the National Action Plan for Climate Change (NAPCC). Like in the case of other major schemes, the actual expenditure for 2020-21 was lower than in 2019-20.  In 2020-21, the actual expenditure was Rs. 191 crores compared to Rs. 240 crores in 2019-20. Even during 2021-22, the initial budget estimates of Rs.290 crores were revised & reduced to Rs. 255 cores. 
• ‘Integrated Development of Wildlife Habitats’ is another centrally sponsored scheme that has multiple components. Support is extended to States to develop habitats for endangered species. The actual expenditure under this head was also affected during 2020-21. In 2020-21, the actual was Rs. 319 crores compared to Rs. 473 crores in 2019-20. 
• The actual expenditure under ‘Project Tiger’ in 2020-21 was Rs. 194 crores compared to Rs. 282 crores in 2019-20.  
• Another major project ‘Development of Wildlife habitats’ also witnessed a fall in expenditure from Rs. 155 crores in 2019-20 to Rs. 89 crores in 2020-21. 

Fall in the Actual Expenditure across various schemes in 2020-21 with a similar trend continuing in 2021-22 

As the data indicates, most of the major schemes and projects under the MoEFCC have witnessed reduced expenditure in 2020-21 compared to both the budget estimates and the actual expenditure in 2019-20. 

In 2021-22, the budget estimates were at par with the earlier years but were reduced & revised later. The trend of lower actual expenditure could continue even in 2021-22 as was the case in 2019-20. 

The Ministry highlighted the progress made under various initiatives in its year-end statement for 2021. As per the Ministry’s statement,

• The ‘Protected Area coverage’ in the country increased from 4.9% of India’s geographical area in 2014 to 5.03%. The number of ‘Protected areas’ increased from 740 to 981 during this period.
• 21 new Wetland conservation sites were designated between 2019-21. 
• The Kigali Amendment to Montreal Protocol was ratified by the Government of India in September 2021. This is aimed at phasing down of Hydrofluorocarbons to protect the Ozone layer. The National Strategy would be developed by 2023. 
• 10 beaches in 7 states and one UT were being developed with international standards and were conferred with Blue Flag certification. 
• From an administrative perspective, PARIVESH was introduced to streamline the procedures for early grant of clearances. As per the government’s statement, the timeframe for environmental clearances is reduced to 70 working days. As per the ministry, various Policy reforms helped in reducing the time taken for various environmental clearances from over 150 days in 2019 to less than 90 days. Environmental Clearances were granted to 7.78 thousand projects in 2021.  

While the reduced expenditure because of the pandemic is understandable, it could significantly impact India’s progress towards meeting its environmental and climate change objectives if amends are not made soon. 

Featured Image: Actual Expenditure of the ‘Environment’ ministry