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By Keya Acharya
Environmentalists and international justice groups are voicing their concerns over proliferating tree plantations, as developing countries try to profit from a growing carbon trade. The India Tobacco Company claims to have stepped into the carbon sinks business in order to benefit village communities. But who really profits?
The villagers of Basavaga in southern India have given up growing cereal crops. They get more lucrative income from the eucalyptus trees that they plant for an Indian tobacco giant, and their lives have changed as a result.
“We are not primitive tribes anymore,” proclaims Pentamma, proudly showing off a house furnished with a home-theatre system plugged into an electrical socket, and a cabinet divided between daughter-in-law and mother-in-law, neatly stacked with colourful saris.
In a country where many don’t have electricity or the money to buy expensive electronics, this relative prosperity deep inside the Indian state of Andhra Pradesh is unexpected.
The fortunes of the poor village turned when three years ago it began growing eucalyptus trees for the multi-billion-dollar India Tobacco Company (ITC), whose paper division buys the logs for wood pulp.
The trees are logged on a three-yearly basis, earning the villagers Rs 1,650 (US$ 37) per metric tonne, or about Rs 10,000 (US$ 223) per acre, every year.
Fifty-two-year-old Pentamma, a Koya tribeswoman, has expanded her eucalyptus plantations from one to all of her three acres this year.
That has displaced local food crops like millet, but villagers say they can now afford to buy some of their food, including rice -- a new symbol of prosperity.
“We grow some millet for our own family and keep rice for guests,” Pentamma says.
Going green
ITC, a US$ 3.5 billion conglomerate that buys the logs through its subsidiary, also operates in agrifoods, cigarettes, hotels, information technology and other sectors.
With new interest in green projects among industrialised nations, ITC hopes to turn a new profit from the village tree projects. It plans to do this by collaborating with businesses abroad that are trying to meet international clean air obligations under the Kyoto Protocol’s Clean Development Mechanism, or CDM
That 1997 agreement, aimed at mitigating climate change from global warming, assigns fixed gas emission targets to industrialised nations that have signed the treaty, which, in turn, divide them among businesses involved in large air polluting activities, such as manufacturing or power-generation.
Firms that exceed their targets have an option to ‘buy’ credits from others that are not using up all their allowance, or offset their excess emissions by paying for an equivalent amount of carbon that is naturally trapped in trees, by projects like ITC’s in Basavaga.
With no easy solutions to global warming, and rich businesses in industrialised nations reluctant to practise more expensive emission-reduction measures, plantation projects in developing countries are skyrocketing as a potential source of precious foreign exchange.
At the recent United Nations conference in the Kenyan capital, Nairobi, experts, environmentalists and international justice groups alike advised caution over the expanding plantations, known as ‘carbon sinks’.
Concerns include: fears that governments and big businesses in developing countries, where food supplies may already be scarce, are diverting cropland for tree plantations; disturbing reports from Uganda to Brazil of indigenous people driven off lands to make carbon sinks; and worries over soil degradation from planting single-tree species, as is customary in plantations.
Critics say that the whole carbon trading system is wrong, granting industrialised nations a blank cheque to keep polluting, and providing no incentive to implement more costly solutions to reduce emissions.
Indian activist Soumitra Ghosh, who works with forest workers in India, warns against a carbon trading system “wherein the poorest and darkest-skinned pay the highest price -- with their health, their land, and, in some cases, with their lives -- for continued carbon profligacy by the rich”.
India: carbon king?
With other big names in the Indian corporate world, like Reliance, Tata, Birla and Ambuja also involved in CDM projects, India tops the world list of CDM ventures.
But the country’s entire carbon trading system has been criticised, most notably by the reputed Delhi-based Centre for Science and Environment (CSE), which says it has turned into a revenue system without adequate monitoring of sustainable development and local community benefits.
Not a single one of India’s 252 CDM projects strictly involve agriculture or rural development. The majority are energy-efficiency projects from industries keen on tax rebates on such ventures.
But Pradeep Dhobale, head of ITC’s paper division, says that once the carbon sink projects have been registered as a CDM, profits from selling carbon to overseas clients will be ploughed back into village communities, without financial gain to ITC from the trade.
At the moment ITC, which is claiming carbon credits from 4,000 hectares of carbon sinks in 220 villages, says it is spending some US$ 450,000 on its ‘social forestry’ projects, and doing so not for the profits or potential tax rebates, but for the good of the village communities.
The forestry projects are the other face of a company that has made its fortune producing health-hazardous cigarettes. ITC has won several good practice awards at its paper plant, most notably from CSE in Delhi.
Steve Sawyer, from the environmental group Greenpeace International, says that plantation projects should be judged individually.
“In some countries, like South Africa, there is plantation forest for sustainable use where communities have a range of benefits,” he says. “But I have heard stories from other countries where natural forests are being eliminated and replaced by plantations after displacement of local people.”
Weighing the pros and cons
In Basavaga, villagers have stayed put on their own lands, planting cloned eucalyptus trees provided free by ITC’s paper subsidiary. Cropland that was previously used to grow food has been diverted for growing trees, but villagers say they are happier with the present arrangement.
Kangala Bhadramma, 35, says that growing eucalyptus trees has freed her from unscrupulous middlemen for her cereal crops.
“Now we know that if the trees grow well, there is money,” says Bhadramma, who like the other villagers sells the logs to ITC through the official Andhra Pradesh Agricultural Produce Marketing Committee.
The villages are talking of cutting out the brokers altogether, and selling directly to the Paperboards and Speciality Papers (PSPL), the ITC subsidiary.
But Miguel Lovera, a plantation expert from the international Global Forest Coalition, is cautious about the benefits. He says that carbon sinks are not viable on small scales like in Basavaga because carbon content must be verified before it can be sold, and measuring carbon absorption in the trees is only cost-effective on a large scale.
Lovera also warns of soil degradation from projects like the one in Basavaga, because single-species, cloned trees are very hard on the land.
“Clones are a very powerful and destructive method of cultivation, because they are too specialised,” Lovera says, on the sidelines of the Nairobi conference. He says they pose “long-term threats to biodiversity, flora and fauna. They will certainly affect soils in the long term.”
ITC claims that the land in Basavaga was degraded anyway. It says that the project is bringing the soil back to life, and that its clones have shallow, non-penetrative roots that have not produced any soil degradation.
“We are environmentally aware,” says PSPL director, Dhobale. “We will change our strategy if it degrades the soil.”
In Basavaga, 75-year-old Khorsam Lakshmaiyya acknowledges that he eats better than ever before, but says he still misses his more humble staple.
“I now eat two rice meals daily instead of one millet meal earlier, but still don’t feel full.”
Panos Features, November 2006
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