Historically there has been a close correlation between econ

Historically there has been a close correlation between economic growth and environmental degradation. Is it possible to be sustainable and profitable?

Solution

Economic growth is seen as an universal cure to all the problems of a developing nation. At the same time economic growth is the major cause for the envionment degradation. At present all the countries are concerned with the quality of the natural environment.Protection of environment and economic growth are often considered to be competitive aims. which means it is hard to be environmentally sustainable and profitable at the same time . However, it is not impossible to achieve the same.

Due to growing population and industrialization various problems of pollution, scarcity of non renewable resources have led to environment degradation. Therefore many environmental policy are been implemented , which basically aims at restricting the access to natural resources or their use may be limited by making subject to various conditions. In short rising income and rising population have brought with them the need for rising environmental protection policies. while the demand for environmental protection is increasing the cost of implementation of these policies comes into question .Spending on environment protection divert the resources of the regulated industries from their core business. Due to which the production becomes more capital intensive and expensive, which affects the demand of the products. And in a particular industry if the competitors do not have to comply with the similar environmental policy because of various reasons the competitiveness of the industries is also affected.

On the other hand long term tightening of the environmental standards helps to establish new markets for environmental technology. Which is only possible if a cost effective environmental policy is developed which aims at minimizing the incurred while achieving the the environmental objective.