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Economic valuation of landscape-level
wetland ecosystem and its services:
Case study of Little Rann of Kachchh (LRK), Gujarat
Somnath Bandyopadhyay
Nalanda University
Rajgir (BIHAR) 803 116 INDIA
www.nalandauniv.edu.in
The ecological facts
Matter cycles; Energy flows
First law of thermodynamics:
Matter is neither created nor
destroyed;
Second law of thermodynamics:
Energy is always lost as heat
(ENTROPY)
Biogeochemical cycles defined:
Water, carbon, nitrogen,
phosphorus, sulphur
Trophic chains discovered:
Grazing chain, detrital chain,
food-webs; 10% law
Source:
Ecological
Economics
Principles &
Applications,
Farley and
Daly
Economic Growth and Human Welfare
Welfare in a growing economy is
dependent on natural resources
(e.g. food);
Welfare in a mature economy is
dependent on human resources
(e.g. health care);
Socialism collapsed because it did not allow prices
to tell the economic truth.
Capitalism may collapse because it does not allow
prices to tell the ecological truth.
Source: Dahle, 2001.
Growth and Development
Quantity Quality
Economy Philosophy Throughput Stock of consumer
goods
Stock of natural
capital
Analogy
Growth More and
more
Maximize Maximize Liquidate Vacuum
tube
Steady-state Do more with
less
Minimize Optimize Maximize Microchip
The real debate: “Prosperity without growth”
• What we need is a debate on creating “prosperity without
growth”
• UK’s Sustainable Development Commission (2009) is a good
start.
Little Rann of Kachchh
Catchment
Area: 10,500 sq km
35 talukas, 7 districts
140 MCM water
Little Rann of Kachchh (LRK)
Area: 3,570 km2
Rann: 3,384 sq km
Bets: (70) 185 sq km
Latitude: 22O55’-24O35”N
Longitude: 70O30’-71O45’E
Rainfall: 325 - 533 mm
Wild Ass Sanctuary, 1973
Study Objectives
• Characterize the wetlands of LRK, with particular reference to variations
in hydrological and salinity regimes;
• Identify unique biodiversity and ecosystem services that support key
economic activities;
• Estimate the economic value of these services, evaluate trade-offs and
propose policy and management options.
Wetlands of LRK Total Area- ~5000 sq km
LRK
GoK/MNP
GRK
Kachchh
Saurashtra
Banas R.
Rupen R.
Bambhani R.
Surajbari
Biodiversity of LRK
o Last remaining population of ~4000 Wild Asses
(Equus hemionus khur)
o Network of wetlands:
o large assemblage of birds, including many rare
and threatened ones
o two of the total five nesting grounds of Lesser
Flamingos in the world
o large congregation of cranes and other
migratory bird species
o Endemic prawn species – Metapenaeus kutchensis
o Unique assemblage of halophytes, including grasses,
in the fringe and island areas
Ecosystem services supporting economic sub-systems
Hydrological Dynamics…Controlled by
• Inflow of - Fresh water- runoff
• Inflow of Saline tidal water from Creek
Formation of Brackish
Water Wetland
Support Ecological System
Prawn, Fish, Zoo and Phyto-plankton
Support Habitat for Migratory Birds
& Other Biodiversity
Prawn Fishing Nature & Wildlife Tourism
Hydrological
Sub- System
Biological
Sub- System
Economic
Sub-System
Outflow of Brackish
water through Creek
Local Occupational Profile
Main Occupation No. of
Families
Key Constituents
Agriculture & Labor 32325 Cotton, Jeera; Isabgol, Jowar, Bajra; Wheat, Sesame,
Groundnut, Castor; Mung, Math
Salt Making 3495 Edible salts & industrial chemicals
Animal Husbandry 2676 Milk, wool, meat
Fishery 1300 Fish, Prawn
Tourism NA Nature and Wildlife
Salt making, prawn fishing and tourism are key ‘wetland dependent’
economic sub-systems for people of 108 peripheral villages.
Fish/ Prawn capture Biodiversity – migratory birds
Salt production Tourism for Recreation/ Education
Key
Values of
LRK
Wetland
Valuation of ecosystem services of LRK
Valuation approach
Sector Method Sample Size Sample Distribution
Fishery Market Analysis 62
62
No. of Sites/Dhasis
8 temporary migrant fishing
settlements and 1 fishing village
Salt production Market Analysis FGD Secondary Data
Tourists Travel Cost 40 No. of Resorts covered - 6
Migratory Birds
CVM
Fishers
Farmers
Tourists
Agarias
Other Public
62
91
40
40
60
8 temporary migrant fishing
settlements and 1 fishing village
19 farmers villages cover in 10
talukas of 5 District
No. of Resorts covered - 6
Valuation of fisheries
Valuation of salt production
Valuation of tourism
Value of LRK wetland
Total Estimated Annual Value of Wetland System of LRK
Goods & Services Method
Total Annual Value*
(Million Rs.)
Prawn Fisheries Market Revenue Analysis 410.14
Salt production Market Revenue Analysis 694.30
Tourism & Recreation Travel Cost 276.05
Maintenance of
Biodiversity
Contingent Valuation 136.80
Total 1517.29
* For Prawn production and Salt production, we estimated net annual value
Important Landscape level Issues
Little
Rann of
Kachchh
Gujarat Part of Catchment Area of
LRK (Dark red line)
• About 10,600 Sq km of total
Catchment
• About 30 small and medium
irrigation schemes in Gujarat
and Rajasthan catchment
• Total Annual Capacity =
1700 MCM
• Average Annual Storage
~ 750 MCM
• Banas River flow reduced
from 70 mcm in 1975 to 4.8
mcm in 1991
• Rupen Riverflow reduced
from 13.2 mcm in 1980 to 6.9
mcm in 1991
• More than 800 check dams
constructed in Gujarat part
• Reduced deposit of organic
detritus, decline prawn growth
• Complete loss of Hilsa fishing
Hydroecology of LRK
o Complete loss of Hilsa fishing
o Reduced deposit of organic detritus, decline in prawn growth
Water Type Proportion (%) Key ecological function
Tidal creek water 27.0 Brings larvae of M. kutchensis and other small invertebrate
species which provide food items for M. kutchensis
Direct rain water 51.7 Provide large amount of freshwater to maintain brackishness and
depth, creating suitable habitat for prawn species
Runoff water
from catchment
21.3 Bring nutrient & detritus materials to LRK, essential for growth of
phyto- and zoo-planktons and other food items of M. kutchensis
Ecologic disturbance and economic mis-management
Hydrological Dynamics…Controlled by
• Inflow of - Fresh water- runoff
• Inflow of Saline tidal water from Creek
• Outflow of Brackish water through creek
Alteration in Hydro-ecological Dynamics
• Salt infrastructure in Creek..Changes in
Water Flow and / or salinity regimes
• Watershed development in catchment area
- Changes in Water and Nutrient flow
Changes in Ecological
Sub-Systems
Changes in Economic
Sub-Systems
Policy regimes and
institutional capability
Unsustainable resource use
& management practices
Understanding the values of ecosystem services
• Values are biased towards the lower end (everything is not recognized,
demonstrated or captured);
• Values keep changing with natural variability, human development and
market conditions;
• Values need to be seen in the light of underlying drivers for ecosystem
services;
• Synergistic and antagonistic dimensions in valuing different ES in the same
ecosystem;
• More than the absolute values, it is important to understand the trends and
what might endure.
Prawn production
Spatial differences in prawn catch
ONLY LOCATIONAL ADVANTAGE,
no additional access to fishing
tools and labour
o Customary norms to access to
different quality fishing
grounds
o Higher prawn biomass
capture near discharge points
of seasonal rivers
o Best locations are river
mouths close to tidal creeks
20% fishers catch about
50% of total annual catch
Salt production
• Diversion of Mud-flats and Creeks for salt work
• Official Salt Lease Area: 21600 ha
• Satellite Imagery based : 44600 ha
Tourism in LRK
perception
satisfaction
0
2000
4000
6000
8000
10000
12000
14000
2001-02 02-03 03-04 04-05 05-06 09-10 10-11 11-12 12-13 13-14
NumberofTourists
Year
Indian Foreign Total
Sustainability of economic values
Conclusion:
economic analysis and policy
oThere is little scope for generating greater value from
salt production without seriously disturbing the
creek ecosystem
oFish catch varies greatly with freshwater availability
ouse-value of biodiversity is growing in LRK despite
natural variability and increasing disturbances, and
osustainable development pathways need to conserve
the flow of ecosystem services in the catchment area
of LRK to support its biodiversity.
Tolerance to wetland
degradation
Human engagement
Sustainable growth of economic value
0
2000
4000
6000
8000
10000
12000
14000
Indian Foreign Total
o Tourists prefer flamingoes;
o Flamingoes abandon nests;
o Lack of adequate water;
o Free catchment could increase
depth of LRK by 29 cm;
o Direct improvement of nesting
sites;
o Collateral gains in prawn
fisheries.
Implications and recommendation
• Need for a tourism policy to regulate infrastructure and promote services
• Sector study of LRK tourism
• Promotional strategy
• Infrastructure, routes, revenues
• Regular monitoring
• Need for a LRK Landscape Authority to negotiate e-flows and agriculture
• Empower and upgrade BCRLIP Society
• Coordinate with development planning processes
• Organize consultation workshops with stakeholders
• Use biodiversity values as indicators of progress
Dr. Arun M Dixit Principal Investigator
Dr. Somnath Bandyopadhyay Co-Investigator
Mr. Lalit Kumar Senior Fellow
Dr. Satyasiba Bedamatta Senior Fellow
Mr. Prashant Kadgi Remote Sensing Expert
Mr. Dipak Nandani Research Assistant
Mr. Ketan Sonara Research Assistant
Mr. Nitin Choudhary Research Assistant
Mr. Pravin Solanki Research Assistant
Thanks from the study team
Special Thanks to
Prof P P Patel
(Geohydrologist, former
Professor, MSU, Vadodara)
Reviewer
(Expert, Env Econ)
Dr Dinesh Kumar
(Hydrologist)
Nitin Bassi
(Hydro-ecologist)
Approach for Eastern Himalayas
• Kameng River Basin (Arunachal Pradesh)
• Comprehensive Management Plan
• Framework for monitoring and research
• GIS-based, multi-dimensional, interactive, decision-support
• Ecological functions – soil, water, vegetation, biodiversity etc.
• Ecosystem services and planning issues – hydropower, land-use change etc.
• Socio-ecological linkages – pollinators, gender, traditional institutions etc.
• Economic valuation of ecosystem services and biodiversity
• Network approach – starting with TISS; NERIST, Universities etc.

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Economic valuation of Little Rann of Kutch

  • 1. Economic valuation of landscape-level wetland ecosystem and its services: Case study of Little Rann of Kachchh (LRK), Gujarat Somnath Bandyopadhyay Nalanda University Rajgir (BIHAR) 803 116 INDIA www.nalandauniv.edu.in
  • 2. The ecological facts Matter cycles; Energy flows First law of thermodynamics: Matter is neither created nor destroyed; Second law of thermodynamics: Energy is always lost as heat (ENTROPY) Biogeochemical cycles defined: Water, carbon, nitrogen, phosphorus, sulphur Trophic chains discovered: Grazing chain, detrital chain, food-webs; 10% law
  • 3. Source: Ecological Economics Principles & Applications, Farley and Daly Economic Growth and Human Welfare Welfare in a growing economy is dependent on natural resources (e.g. food); Welfare in a mature economy is dependent on human resources (e.g. health care);
  • 4. Socialism collapsed because it did not allow prices to tell the economic truth. Capitalism may collapse because it does not allow prices to tell the ecological truth. Source: Dahle, 2001.
  • 5. Growth and Development Quantity Quality Economy Philosophy Throughput Stock of consumer goods Stock of natural capital Analogy Growth More and more Maximize Maximize Liquidate Vacuum tube Steady-state Do more with less Minimize Optimize Maximize Microchip
  • 6. The real debate: “Prosperity without growth” • What we need is a debate on creating “prosperity without growth” • UK’s Sustainable Development Commission (2009) is a good start.
  • 7. Little Rann of Kachchh Catchment Area: 10,500 sq km 35 talukas, 7 districts 140 MCM water Little Rann of Kachchh (LRK) Area: 3,570 km2 Rann: 3,384 sq km Bets: (70) 185 sq km Latitude: 22O55’-24O35”N Longitude: 70O30’-71O45’E Rainfall: 325 - 533 mm Wild Ass Sanctuary, 1973
  • 8. Study Objectives • Characterize the wetlands of LRK, with particular reference to variations in hydrological and salinity regimes; • Identify unique biodiversity and ecosystem services that support key economic activities; • Estimate the economic value of these services, evaluate trade-offs and propose policy and management options.
  • 9. Wetlands of LRK Total Area- ~5000 sq km LRK GoK/MNP GRK Kachchh Saurashtra Banas R. Rupen R. Bambhani R. Surajbari
  • 10. Biodiversity of LRK o Last remaining population of ~4000 Wild Asses (Equus hemionus khur) o Network of wetlands: o large assemblage of birds, including many rare and threatened ones o two of the total five nesting grounds of Lesser Flamingos in the world o large congregation of cranes and other migratory bird species o Endemic prawn species – Metapenaeus kutchensis o Unique assemblage of halophytes, including grasses, in the fringe and island areas
  • 11. Ecosystem services supporting economic sub-systems Hydrological Dynamics…Controlled by • Inflow of - Fresh water- runoff • Inflow of Saline tidal water from Creek Formation of Brackish Water Wetland Support Ecological System Prawn, Fish, Zoo and Phyto-plankton Support Habitat for Migratory Birds & Other Biodiversity Prawn Fishing Nature & Wildlife Tourism Hydrological Sub- System Biological Sub- System Economic Sub-System Outflow of Brackish water through Creek
  • 12. Local Occupational Profile Main Occupation No. of Families Key Constituents Agriculture & Labor 32325 Cotton, Jeera; Isabgol, Jowar, Bajra; Wheat, Sesame, Groundnut, Castor; Mung, Math Salt Making 3495 Edible salts & industrial chemicals Animal Husbandry 2676 Milk, wool, meat Fishery 1300 Fish, Prawn Tourism NA Nature and Wildlife Salt making, prawn fishing and tourism are key ‘wetland dependent’ economic sub-systems for people of 108 peripheral villages.
  • 13. Fish/ Prawn capture Biodiversity – migratory birds Salt production Tourism for Recreation/ Education Key Values of LRK Wetland
  • 14. Valuation of ecosystem services of LRK
  • 15. Valuation approach Sector Method Sample Size Sample Distribution Fishery Market Analysis 62 62 No. of Sites/Dhasis 8 temporary migrant fishing settlements and 1 fishing village Salt production Market Analysis FGD Secondary Data Tourists Travel Cost 40 No. of Resorts covered - 6 Migratory Birds CVM Fishers Farmers Tourists Agarias Other Public 62 91 40 40 60 8 temporary migrant fishing settlements and 1 fishing village 19 farmers villages cover in 10 talukas of 5 District No. of Resorts covered - 6
  • 17. Valuation of salt production
  • 19. Value of LRK wetland Total Estimated Annual Value of Wetland System of LRK Goods & Services Method Total Annual Value* (Million Rs.) Prawn Fisheries Market Revenue Analysis 410.14 Salt production Market Revenue Analysis 694.30 Tourism & Recreation Travel Cost 276.05 Maintenance of Biodiversity Contingent Valuation 136.80 Total 1517.29 * For Prawn production and Salt production, we estimated net annual value
  • 20. Important Landscape level Issues Little Rann of Kachchh Gujarat Part of Catchment Area of LRK (Dark red line) • About 10,600 Sq km of total Catchment • About 30 small and medium irrigation schemes in Gujarat and Rajasthan catchment • Total Annual Capacity = 1700 MCM • Average Annual Storage ~ 750 MCM • Banas River flow reduced from 70 mcm in 1975 to 4.8 mcm in 1991 • Rupen Riverflow reduced from 13.2 mcm in 1980 to 6.9 mcm in 1991 • More than 800 check dams constructed in Gujarat part • Reduced deposit of organic detritus, decline prawn growth • Complete loss of Hilsa fishing
  • 21. Hydroecology of LRK o Complete loss of Hilsa fishing o Reduced deposit of organic detritus, decline in prawn growth Water Type Proportion (%) Key ecological function Tidal creek water 27.0 Brings larvae of M. kutchensis and other small invertebrate species which provide food items for M. kutchensis Direct rain water 51.7 Provide large amount of freshwater to maintain brackishness and depth, creating suitable habitat for prawn species Runoff water from catchment 21.3 Bring nutrient & detritus materials to LRK, essential for growth of phyto- and zoo-planktons and other food items of M. kutchensis
  • 22. Ecologic disturbance and economic mis-management Hydrological Dynamics…Controlled by • Inflow of - Fresh water- runoff • Inflow of Saline tidal water from Creek • Outflow of Brackish water through creek Alteration in Hydro-ecological Dynamics • Salt infrastructure in Creek..Changes in Water Flow and / or salinity regimes • Watershed development in catchment area - Changes in Water and Nutrient flow Changes in Ecological Sub-Systems Changes in Economic Sub-Systems Policy regimes and institutional capability Unsustainable resource use & management practices
  • 23. Understanding the values of ecosystem services • Values are biased towards the lower end (everything is not recognized, demonstrated or captured); • Values keep changing with natural variability, human development and market conditions; • Values need to be seen in the light of underlying drivers for ecosystem services; • Synergistic and antagonistic dimensions in valuing different ES in the same ecosystem; • More than the absolute values, it is important to understand the trends and what might endure.
  • 25. Spatial differences in prawn catch ONLY LOCATIONAL ADVANTAGE, no additional access to fishing tools and labour o Customary norms to access to different quality fishing grounds o Higher prawn biomass capture near discharge points of seasonal rivers o Best locations are river mouths close to tidal creeks 20% fishers catch about 50% of total annual catch
  • 26. Salt production • Diversion of Mud-flats and Creeks for salt work • Official Salt Lease Area: 21600 ha • Satellite Imagery based : 44600 ha
  • 27. Tourism in LRK perception satisfaction 0 2000 4000 6000 8000 10000 12000 14000 2001-02 02-03 03-04 04-05 05-06 09-10 10-11 11-12 12-13 13-14 NumberofTourists Year Indian Foreign Total
  • 29. Conclusion: economic analysis and policy oThere is little scope for generating greater value from salt production without seriously disturbing the creek ecosystem oFish catch varies greatly with freshwater availability ouse-value of biodiversity is growing in LRK despite natural variability and increasing disturbances, and osustainable development pathways need to conserve the flow of ecosystem services in the catchment area of LRK to support its biodiversity. Tolerance to wetland degradation Human engagement
  • 30. Sustainable growth of economic value 0 2000 4000 6000 8000 10000 12000 14000 Indian Foreign Total o Tourists prefer flamingoes; o Flamingoes abandon nests; o Lack of adequate water; o Free catchment could increase depth of LRK by 29 cm; o Direct improvement of nesting sites; o Collateral gains in prawn fisheries.
  • 31. Implications and recommendation • Need for a tourism policy to regulate infrastructure and promote services • Sector study of LRK tourism • Promotional strategy • Infrastructure, routes, revenues • Regular monitoring • Need for a LRK Landscape Authority to negotiate e-flows and agriculture • Empower and upgrade BCRLIP Society • Coordinate with development planning processes • Organize consultation workshops with stakeholders • Use biodiversity values as indicators of progress
  • 32. Dr. Arun M Dixit Principal Investigator Dr. Somnath Bandyopadhyay Co-Investigator Mr. Lalit Kumar Senior Fellow Dr. Satyasiba Bedamatta Senior Fellow Mr. Prashant Kadgi Remote Sensing Expert Mr. Dipak Nandani Research Assistant Mr. Ketan Sonara Research Assistant Mr. Nitin Choudhary Research Assistant Mr. Pravin Solanki Research Assistant Thanks from the study team Special Thanks to Prof P P Patel (Geohydrologist, former Professor, MSU, Vadodara) Reviewer (Expert, Env Econ) Dr Dinesh Kumar (Hydrologist) Nitin Bassi (Hydro-ecologist)
  • 33. Approach for Eastern Himalayas • Kameng River Basin (Arunachal Pradesh) • Comprehensive Management Plan • Framework for monitoring and research • GIS-based, multi-dimensional, interactive, decision-support • Ecological functions – soil, water, vegetation, biodiversity etc. • Ecosystem services and planning issues – hydropower, land-use change etc. • Socio-ecological linkages – pollinators, gender, traditional institutions etc. • Economic valuation of ecosystem services and biodiversity • Network approach – starting with TISS; NERIST, Universities etc.