Environmental Regulation in India’s Odisha State
In 1995, with technical assistance from the World Bank, Indonesia introduced its Program for Pollution Control Evaluation and Rating (PROPER), the first such environmental rating and disclosure (ERD) initiative in the developing world. With experience from Indonesia, the World Bank helped introduce the concept to other countries, including Ghana, and eventually to the Indian State of Odisha. This made Odisha the first state to begin ranking pollution intensive industries. To promote sustainable economic growth, Odisha’s State Pollution Control Board (OSPCB), the main environmental regulatory arm of the Indian State of Odisha’s Government, initiated its ERD Environmental Compliance Assessment, Monitoring and Rating Program (ECAMRA) in November, 2013.
While ERD offers an inclusive, cost-effective, and transparent regulatory approach, it involves a complex set of skills and knowledge to design and implement. There are also significant political challenges. Ultimately, the success of ERD hinges on getting buy-in from the private sector. To build on a strong effort to launch ECAMRA, the Government of Odisha requested financing and technical support from the World Bank to organize a knowledge exchange for key Odisha State environmental and ERD officials to visit and learn from the successful ERD programs in Indonesia and Ghana. In subsequent visits to the two countries, the Indian delegation learned about the detailed technical design of ERD programs in both countries to strengthen environmental compliance and regulatory management capacity in Odisha.
The World Bank has championed the environmental rating and disclosure (ERD) approach since 1994. Since 2013, the World Bank has introduced the ERD program to various state governments in India. To promote sustainable economic growth, the Odisha State Pollution Control Board (OSPCB), the main environmental regulatory arm of the Odisha State Government, is encouraging efficient production and consumption patterns and low-carbon growth. This includes adoption of an ERD initiative called the Environmental Compliance Assessment, Monitoring and Rating Program (ECAMRA).
ERD offers an inclusive, cost effective, transparent regulatory approach. ERD encourages efficient resource production and consumption, including water and energy use, low-carbon production, reduce-reuse and recycle, and biodiversity protection. But design and implementation of an ERD program is complex and requires a range of technical, political, and administrative skills. The effectiveness of such a comprehensive approach hinges on having engaged and empowered stakeholders, including the community at large and buy in from the private sector.
To set the stage for implementation of the ECAMRA ERD--under the World Bank’s Odisha Mining and Inclusive Growth non-lending technical assistance (NLTA)---a World Bank consultant supported OSPCB in developing a detailed implementation plan in December 2013 entitled “A Roadmap for Introducing Environmental Rating and Disclosure Initiative at the Odisha State Pollution Control Board”. The OSPCB Board passed a resolution to introduce the rating initiative and to socialize it with industries. OSPCB then compiled baseline environmental data and conducted baseline ratings of 130 top polluting industries in Odisha.
But to move forward with the next steps to implement ERD, Odisha officials felt they needed help to gain a more nuanced understanding of the design and implementation challenges involved. OSPCB officials were keen to learn about the challenges associated with the evaluation and disclosure of the final environmental ratings to the media and the public, and the long-term management and sustainability issues related to ERD.
ERD programs in Ghana and Indonesia stand out for their success. Indonesia introduced the first ERD initiative in 1995, the Program for Pollution Control and Rating (PROPER). Indonesia’s PROPER program has a long history, scaling up from 187 industries in 1995 to 2,076 industries in 2015. The Ghanaian EPA’s launched its much smaller AKOBEN program with 61 companies in 2009 and has reached 168 companies. However, while PROPER does not publish rating criteria for the mining sector, AKOBEN is the first ERD program in the world with a detailed environmental rating methodology for mining. The AKOBEN program is therefore an important contributor to international ERD efforts.
OSPCB officials expressed interest in visiting Ghana and Indonesia to meet environmental counterparts. In response, the World Bank, with financing support from the South-South Facility, organized a study tour to bring the Indian delegation together with officials from environmental agencies in Ghana and Indonesia, and with external stakeholders including industries, NGOs, and the media.
The exchange started with video-conferences and audio meetings between the knowledge-receiving country, India, and the knowledge-providing countries, Indonesia and Ghana. The pre-study tour meetings allowed the participants to understand the learning and knowledge sharing objective and the overall goal of the program.
A delegation from the Government of Odisha (GoO) and the OSPCB traveled for a study tour to Accra, Ghana on May 10-15, 2015. The Odisha State delegation of four officials included senior civil services officers, the State Development Commissioner, and technical and operational environmental officers. To start the knowledge exchange, Ghanaian Environmental Protection Agency (EPA) officials delivered a detailed introduction to their AKOBEN program, including the design and the operational details for the mining and manufacturing sectors, which is very applicable to the industrial profile of Odisha. Additional meetings included discussions with the Ministry of Environment, Science, Technology and Innovation (MESTI). The itinerary in Ghana also included field visits to a sample of companies rated under the Ghanaian program, including meetings with representatives from heavy industries. The group also met with KASA, a Ghanaian environmental NGO that works to enhance the capacity of civil society and media in the area of natural resources. Since communication is an integral part of ERD, the Head of Communications of EPA Ghana also addressed the Indian delegation.
The study tour to Jakarta, Indonesia on May 18-22, 2015 followed a similar structure as in Ghana, except for a few details. Odisha officials met counterparts with the PROPER team in Indonesia’s Ministry of Environment and Forestry (MoEF). Since information regarding environmental performance tends to affect the stock market, the delegates also met with the Indonesian Financial Services Authority (IFSA), a financial industry regulator. Given the importance of understanding the private sector’s stance on ERD, the Indian officials also met with representatives from energy, mining, palm oil, food & beverage, paper & pulp, cement, power generation, and coal-mining companies. The Indian officials also met with a journalist from Kompas, a daily newspaper with the largest circulation in Indonesia.
The study visits were followed by phone conversations between the India delegation and their counterparts at PROPER, MOEF-Indonesia, AKOBEN EPA-Ghana, as well as experts met during the field visits. With help from the World Bank consultant and EPRD expert, the Indians compiled lessons and experiences from the study tours into a knowledge report: “Strengthening Environmental Governance through Disclosure and Transparency: Lessons from the Ghana-India-Indonesia South-South Knowledge Exchange Program”. The report provides easy reference for the Government of Odisha as it develops and implements the ECAMRA program.
While ERD programs are well documented, publishing reports cannot substitute for building the complex set of knowledge and skills that a knowledge exchange provides through face-to-face discussions.
In developing a successful knowledge exchange program or study tour, it is very important for both the knowledge receiving and providing countries to identify and understand the key knowledge gaps and questions to be covered up front. This is crucial to help finetune the objectives of the exchange and tailor the plan of activities to cater to the knowledge gaps.
The exchange logistics in Ghana and in Indonesia were handled very differently. In Indonesia, the World Bank team hired an event planner as a service provider. In Ghana, the World Bank team tried to handle the logistics themselves, and this turned out to be very complex.
The best knowledge providers on ERD are environmental regulators who have multiple years of experience in implementing a large-scale rating and disclosure program and are directly involved with the management of ERD, including data collection, analysis, disclosure, and communications of environmental ratings. Both Ghana and Indonesia teams in this exchange are uniquely qualified.
Beneficiaries / Participants
The beneficiary participants in the exchange are directly involved in the design and implementation of the ECAMRA program in Odisha State, or they are expected to play a key role in providing political support for the program. Odisha participants included the following key government officials:
- Dept. of General Administration (IAS) Development Commissioner
- Chief Secretary to Planning & Coordination Department and Chairman to SPCB, Odisha
- IFS, Member Secretary, SPCB, Odisha
- Senior Environmental Engineer, SPCB, Odisha
- Deputy Environmental Engineer, SPCB, Odisha
World Bank Contribution
Guided by the priorities of the 12th Five-Year Plan and the underpinnings of the World Bank 2013-17 Country Partnership Strategy for India, the Government of India is integrating its seven low-income states, including Odisha, in mainstream development of the country. This knowledge exchange is linked to the World Bank project P147522, Orissa State Climate Change Action Plan.
The request for World Bank support to implement Odisha’s ECAMRA derives from a sustained engagement with the State Government of Odisha (GoO) for environment quality around the mining sector. In 2007, the GoO and the World Bank jointly issued a report titled, “Towards Sustainable Mineral Intensive Growth in Orissa, Managing Environmental and Social Impacts”. The report noted a need to address the externalities of accelerated mineral-intensive growth through improved enforcement of environmental and mining regulations. The report also highlighted the need for increased accountability and environmental transparency.
The central Government of India (GoI) is modernizing mining sector policies and regulations. The 2011 GoI Draft Mines and Minerals (Development and Regulation) Bill replaces the defunct 1957 Act and intends to empower the central government and counterpart state agencies with improved oversight on policy, granting of licenses, regulatory monitoring, and benefit-sharing, which are critical to sustaining outcomes and sharing benefits from the mining sector equitably.
This exchange will help inform institutional arrangements towards effective and inclusive regulation of environmental performance while reducing the social cost of mining and industrial sectors on local communities. Following the successful study tour, the Government of Odisha maintained efforts to mobilize funds to complete the development of the ECAMRA program. Similarly, the World Bank has incorporated the concept in the South Asia Resource Efficiency and Cleaner Production Project.
New knowledge: The exchange strengthened the operational and technical knowledge of decision makers, senior management, and operational staff at Odisha’s State OSPCB. The Indian delegation learned about the detailed technical design of the ERD programs in Ghana and Indonesia, and they learned about political management for ERD.
“We are adapting this rating system that Ghana has been using for some time. We are taking lessons from them to design our own systems similarly,” said Mr. Upendra Nath Behera, Development Commissioner, Department of General Administration.
Enhanced skill: The exchange strengthened environmental compliance and regulatory management capacity at the OSPCB. The exchange was organized to maximize learning on key topics: site inspections and audit; computerized system for data collection; computerized system for the analysis of final ratings; and communications and disclosure strategy.
Enhanced connectivity: The exchange launched a platform for sharing learning between all parties. The Indian officials received insights on how to collaborate with external stakeholders and were able to initiate a knowledge network for ERD programs. The exchange triggered the creation of a cross-regional, three-country learning platform for sustainable growth and low-carbon development. The knowledge network between Odisha State Pollution Control Board (OSPCB) with the Environmental Protection Agency (EPA) in Ghana and the Ministry of Environment and Forestry (MOEF) in Indonesia will provide hands-on guidance and mentoring to smooth implementation and scale-up of ECAMRA in Odisha. As other countries adopt ERD, or address broader pollution control challenges, this study tour serves as a model for hands-on knowledge exchange.
“The idea behind [ERD] is to provide carrots to the private sector to factor in environmental externalities; to provide incentives, in other words, to not pollute. ERD is a tool to bring together the stakeholders.” (…) “With pollution, the communities that lose most are the poor. These [rating] programs offer the communities the opportunity to have a voice and input into an inclusive program for environmental management.” said Ms. Dora Nsuwa Cudjoe, an Environmental Specialist with the World Bank who helped organize the knowledge exchange.
Indonesia: PROPER; Ministry of Environment and Forestry (MoEF), Indonesian Financial Services Authority (IFSA), Kompas newspaper
Ghana: EPA, AKOBEN program; Ministry of Environment, Science, Technology and Innovation (MESTI), NGO KASA.
You Tube video on the exchange: https://www.youtube.com/watch?v=lh8aDU03fI0&feature=youtu.be
Aluminium Plant in Tema, Ghana – Credit: Dora Nsuwa Cudjoe
 The acronym ECAMRA resonates with Odisha most popular festival called the EKAMRA Utsav. The ECAMRA program is the first program of its kind being introduced by a State Pollution Control Board (SPCB).
 The name of Ghana’s environmental rating program—AKOBEN—has its roots in Ghana’s tradition of
Adinkra symbols (http://adinkra.org). AKOBEN stands for vigilance and wariness—a set of behaviors that is pertinent for the issue of environmental conservation. Further, AKOBEN also signifies alertness and readiness to serve a good cause. The AKOBEN program has strong Ghanaian roots and its rating methodology is tailored to reflect Ghana’s environmental values.