Green budgeting is a paradigm shift in the way economic planning is approached: Message from green budgeting at workshop held in Puducherry

Puducherrry, January 10, 2024: Annual budget processes are crucial from the point of view of planning and coordination and can be seen as an important entry point for mainstreaming climate action and environment related SDG targets in planning processes. Institutionalizing green budgeting can lead to active mind-sets of departments and lead to better planning and coordination within the existing fiscal space. Thus, green budgets can be a useful tool to mainstream sustainable development horizontally across departments.

The Government of Puducherry took a significant step by introducing its first green budget report in the fiscal year 2023-24. The green budget of the Union Territory increased by 153 per cent from INR 191 crores in the baseline year of FY 2022-23 to INR 483 crores in FY 2023-24. The report not only analysed the green budget for the fiscal year but also provided baseline indicators aligned with SDGs, demonstrating a proactive approach towards global sustainability goals. In continuation of this positive momentum, Puducherry Climate Change Cell, Department of Science, Technology and Environment in collaboration with The Energy and Resources Institute (TERI), organized the 2nd Capacity Building Workshop on Green Budgeting for the U.T. of Puducherry. By adopting green budgeting, governments take a collective step in committing towards streamlining policy making, financial resources, and thought process towards environment friendly and greener initiatives.

The objective of the workshop was to engage with state officials responsible for budget-making decisions and processes under various schemes and provide them with an orientation on green budgeting. To further strengthen the existing process, the U.T. of Puducherry could report on green budget allocation as well as actual expenditure.

The workshop was attended by more than 50 government officials in charge of budget-making decisions from the departments of finance, environment, fisheries, port, electricity, information technology, labour, social welfare, agriculture, police, tourism, higher education, public works, women & child welfare, health, local administration, economic and statistics, rural development, and others. Experts asserted that green budgets can be a useful public finance tool for systematically mapping and tracking allocations, outlays, expenditures, and policies.

Speaking on green budgeting, Mr Ashish Madhaorao More, Secretary (Finance) stated, “Green Budgeting is not merely a financial strategy but a paradigm shift in the way we approach economic planning. “The idea of Green Budgeting is an inclusive process, as it is not a venture for one department but a collective responsibility across all government sectors”, he added.

In his Thematic Address, Dr Prodipto Ghosh, Distinguished Fellow, TERI and Former Secretary, Ministry of Environment, underscored, “Green budgeting should progressively become more detailed with iteration. The aspirational goal should be to quantify the environmental impacts of public spending”.

Dr Sagaya Alfred, Senior Scientific Officer, Department of Science, Technology and Environment, welcomed all the participants of the workshop and emphasized the importance of green budgeting as a policy tool to create awareness among various departments.

Mr K. Kalamegam, Environmental Engineer, Department of Science, Technology and Environment, highlighted the need for efficient budgetary planning to evolve good practices so that the government's physical spending aligns with the various environmental targets and objectives.

In the context of the upcoming union budget, Dr Shailly Kedia, Senior Fellow, TERI, underscored that at the central level issue-based budgeting exists. Statement 12 of the Union Budget is on child budgeting while Statement 13 of Union Budget is on gender budgeting. In wake of the triple planetary crisis of climate change, biodiversity loss and pollution, it is high time that green budgeting gets adopted at the union budget level.