Economic Reforms and Sustainability - A Conceptual Analysis & Framework

Both economic reforms and sustainability have come to the fore at the same time in recent years. In fact, they are contradictory to each other as also their underlying principles conflict with each other. For instance, economic reforms advocate faster rates of growth while sustainability pleads for slower rates fearing that the resource-base may be depleted faster and thereby, jeopardizing the interests of future generations. This is indeed a puzzling situation which the policy making system constantly faces. An attempt is made in this working paper to resolve this conflicting situation with a view to make sustainability compatible with the economic reforms. The paper focuses on non-renewable mineral resources because the problems posed by the renewable resources like forestry, fishery, soil fertility etc., are however, totally different requiring a different type of analysis and treatment. For the sake of brevity and precision, a number of charts have been presented to avoid elaborate explanations. On the basis of our analysis as presented here, it can be surmised that the economic reforms will largely be constrained by environmental factors and the criticalities of resource base or the sustainability. The paper argues that sustainability can only be made compatible with economic reforms through exploration ventures and conservation programs on a continuing basis. This is perhaps the only way through which the ordeals of doomsday can be overcome. Therefore, the public policies need to be oriented and geared towards that end. Otherwise, sustainability will just remain, to borrow Solow's words, nothing more than a slogan or an expression of emotion