Incentivise greener industries

Concerns about how industry impacts the environment are growing. The manufacturing sector is one of those that is subject to a lot of scrutiny, thanks to the input and output of materials and potential waste that is created in the process.

Rapid and extensive industrialization has been one of the leading causes of global environment pollution. Black smoke spewing chimneys and noxious effluent emitting manufacturing units are potent symbols of the long carbon footprint of industries. However, with increasing realization that for the earth and the humans to survive and flourish the environmentally damaging aspects of the industries need to become things of the past. On the other hand, industrial development is perhaps the only mechanism that will enable developing countries to reduce the level of poverty and hardship
they face.

United Nations Industrial Development Organisation or UNIDO coined the concept Green industry to place sustainable industrial development in the context of new global sustainable development challenges. Green industry means economies striving for a more sustainable pathway of growth, by undertaking green public investments and implementing public policy initiatives that encourage environmentally responsible private investments. This is a method to attain sustainable economic growth and promote sustainable economies. It includes policymaking, improved industrial production processes and resource-efficient productivity.

‘Greening’ investments are critical. Bangladesh economy has been targeting a middle-income status by 2021, and for such development to occur, a sustainable development is required, for which a green industry is one of the major drivers. The only way to reconcile investments with sustainability and avoid excessive social/health costs is to make them ‘greener’ from the beginning. For this, stronger regulation and enforcement are needed. Regulatory approaches must be complemented by incentives, economic tools, fiscal policies, and financing.

The cost of environmental damage in this country, and the rest of the globe, is enormous. Every year, the economy suffers huge losses due to various climate change events and escalating shortage of natural resources. Environmental concerns expressed by international buyers and other stakeholders have increasingly caused industries to give greater emphasis to environmental performance. Adoption of cleaner production methods has yielded financial gains independent of advantages in facilitating regulatory compliance. Local industries, not just exporters, can cut production costs by using cleaner production, which involves making changes in production processes, products, and services that enhance the efficiency of resource use and reduce environmental risk and liability.

The banks here can provide green loans at low interest rates to industries taking steps to mitigate their detrimental environmental impacts. They can also attract environmentally conscious consumers by providing loans for green housing or hybrid car loans on comparatively lower interest rates. A surge in the area of green financing can minimise the various international pressures arising from international environmental agreements and from organisations like IFC for accelerating green banking adoption.

It is very unfortunate that be it killer heat wave or abrupt changes in rain patterns causing immense destruction, care for the environment remains out of public and private discourse in this country.

One of the most appealing benefits to embracing sustainable manufacturing is the way that it can lower costs for businesses in the long run. Whether industries begin using renewable energy, such as solar power, to offset the use of more expensive traditional sources, or relying on smarter technology to better regulate your energy consumption, you will begin to see a reduction in your overheads. Though there is often an upfront cost for switching to greener options, these technologies usually have a relatively short payback period. Sustainable practices can also help the industries become more efficient with materials, giving much better value for money. In turn, with less waste to deal with, disposal costs will also decrease. Also eco-friendly measures can help industries gain access to new markets that are only open to businesses demonstrating sustainable credentials.

Private finance is very limited in the contextualised climate change discourse of Bangladesh. In fact, private sector finance in climate resilience and adaptation is not at all commensurate with the externalities generated by production lines in private corporations. Consequently, a major share of contribution needs to come from public financing of climate change. In the context of Bangladesh, almost all of monetary disbursements come from national organisations and private sources of financing are strictly limited.

The concept of ecotourism has caught on in the recent years. Ecotourism is meant to minimise the adverse effects of hotels, trails, and other infrastructure by using either recycled materials or plentifully available local building materials, renewable sources of energy, recycling and safe disposal of waste and garbage, and environmentally and culturally sensitive architectural design. Ecotourism also requires that the numbers and mode of behaviour of tourists be regulated to make sure there’re is limited damage to the ecosystem. Ecotourism also means education, for both tourists and residents of nearby communities. Before organizing tours, tour operators should supply travellers with reading material about the country, environment and local people, as well as a code of conduct for both the traveller and the industry itself.

One of the biggest upcoming industries is agri-business and agri-technology, which in turn has the potential to expand the market for climate resilient agriculture/adaptation technology through extensive research and development. Successful prototypes include hydroponics, farming of crab and
sunflower.

According to media reports Bangladesh Bank has selected 68 products under 13 categories so that lenders can disburse loans under the its sustainable financing Bangladesh Bank selected 68 products under 13 categories so that lenders can efficiently disburse loans under its sustainable financing programme. Major products include solar home systems, biogas and wind power plants, biological effluent treatment plants (ETPs), wastewater treatment plants, PET bottle recycling plants, compressed block-bricks, palm oil production, organic farming and so on.

There needs to be revision of national environment quality standards. The authorities concerned should strengthen and expand cleaner production centres. Bangladesh needs to design a greener tax regime that includes, for example, pro-growth, pro-poor environmental and carbon taxes, and the elimination of environment damaging subsidies.  It also needs to have a better financing regime for industries and small and medium enterprises. Green financing makes access easier for environmentally responsible enterprises and activities. The key to the successful strategic implementation of the vision of green industry is the creation of synergy within the different components of the system.

The writer is a journalist. He can be contacted at smmsagar48@gmail.com