Central Banker speak on biodiversity and ecosystems

RBI Deputy Governor Usha Thorat gives a speech on a very unusual topic for a central banker- The Economics of Ecosystems and Biodiversity. However, the speech is quite good and refreshing as well.

For a layperson, such as me, having accepted Pavan’s invitation, it meant starting from scratch. I needed to understand the jargon. What do the terms biodiversity and ecosystem services mean? Why is it important for us to think and talk about these issues? What is the value of biodiversity and ecosystem services? Why should we attribute monetary value to biodiversity and ecosystem services? More importantly, how do we attribute monetary value to these services? Finally, how do we integrate the process of attributing monetary value to these concepts into decision-making on investment projects and use of natural resources – whether in the public or private sectors? What should be the policy framework, and consequently the regulatory framework, to implement these policies?

What do these terms mean?

So, what are biodiversity and ecosystem services and why and how do we measure their value? Wikipedia defines biodiversity as the variation of life forms within a given ecosystem, biome or on the entire Earth. Biodiversity is often used as a measure of the health of biological systems. The biodiversity found on Earth today consists of many millions of distinct biological species. Many biologists now believe that ecosystems rich in diversity gain greater resilience and are, therefore, able to recover more readily from stresses such as drought or human-induced habitat degradation.  

Humankind benefits from a multitude of resources and processes that are supplied by natural ecosystems. Collectively, these benefits are known as ecosystem services. Some of these ecosystem services are air quality, climate (both global CO2 sequestration and local), water purification, pollination, and prevention of soil erosion. While scientists and environmentalists have discussed ecosystem services for decades, these services were popularized and their definitions formalized by the United Nations 2004 Millennium Ecosystem Assessment (MA), a four-year study involving more than 1,300 scientists worldwide. The study grouped ecosystem services into four broad categories: provisioning, such as the production of food and water; regulating, such as the control of climate and disease; supporting, such as nutrient cycles and crop pollination; and cultural, such as spiritual and recreational benefits.

Hmm. Read the whole thing for more ideas on the topic. I have absolutely no idea about this topic so no comments….

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2 Responses to “Central Banker speak on biodiversity and ecosystems”

  1. select your broker Says:

    Biodiversity is the variation of life forms within a given ecosystem, biome, or on the entire Earth. Biodiversity is often used as a measure of the health of biological systems. The biodiversity found on Earth today consists of many millions of distinct biological species. The year 2010 has been declared as the International Year of Biodiversity.

  2. unicon india Says:

    Today there is concern that the period since the emergence of humans is part of a mass reduction in biodiversity, the Holocene extinction, caused primarily by the impact humans are having on the environment, particularly the destruction of plant and animal habitats. In addition, human practices have caused a loss of genetic biodiversity.

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