𝐀 𝐏𝐫𝐞𝐥𝐢𝐦𝐢𝐧𝐚𝐫𝐲 𝐭𝐨𝐮𝐜𝐡 𝐭𝐨 𝐆𝐫𝐞𝐞𝐧 𝐆𝐃𝐏 𝐚𝐧𝐝 𝐢𝐭𝐬 𝐒𝐮𝐢𝐭𝐚𝐛𝐢𝐥𝐢𝐭𝐲

GDP is the total market value of all newly produced final goods and services produced within the domestic territory of a country during a year. To calculate the value of the gross domestic product, all goods and services produced are multiplied by their respective prices and summed up.

𝑆𝑦𝑚𝑏𝑜𝑙𝑖𝑐𝑎𝑙𝑙𝑦,

𝐺𝐷𝑃=𝑃1*𝑄1+𝑃2*𝑄2+…. 𝑃𝑖*𝑄𝑖

Where,

P= Market price of final goods and services

Q= Quantity of goods and services

i= Final product from 1 to n

Therefore, GDP is concerned with the market value of all currently produced final goods and services produced by all producing units within a geographical border of a country during a given time. All the intermediate goods and services are excluded from the measurement of GDP.

GDP is taken as one of the popular and widely used measures of an economy’s output or production. The GDP of a country measures the produced output but ignores the ingredients needed to generate such output like destruction and exploitation of natural resources (especially water and air).

Thus, such factors to take into consideration, we have another concept named Green GDP. Green GDP, therefore, considers the environmental impacts on the productivity of the country. It is derived from GDP itself after adjusting the cost of environmental degradation and pollution damages.

So,

𝑮𝒓𝒆𝒆𝒏 𝑮𝑫𝑷= 𝑮𝑫𝑷-𝑪𝒐𝒔𝒕 𝒐𝒇 𝒏𝒂𝒕𝒖𝒓𝒂𝒍 𝒓𝒆𝒔𝒐𝒖𝒓𝒄𝒆 𝒆𝒙𝒉𝒂𝒖𝒔𝒕𝒊𝒐𝒏- 𝑷𝒐𝒍𝒍𝒖𝒕𝒊𝒐𝒏 𝒅𝒂𝒎𝒂𝒈𝒆𝒔

The green gross domestic product is thus an index of economic growth with the environmental consequences of that growth factored in. Green GDP monetizes the loss of biodiversity and accounts for costs caused by climate change.

The concept of Green GDP has added 𝑡𝑤𝑜 𝑖𝑚𝑝𝑜𝑟𝑡𝑎𝑛𝑡 𝑖𝑠𝑠𝑢𝑒𝑠. 𝑂𝑛𝑒 𝑖𝑠 𝑡ℎ𝑎𝑡 𝑖𝑡 ℎ𝑎𝑠 𝑎𝑑𝑑𝑒𝑑 𝑎 𝑛𝑒𝑤 𝑑𝑖𝑚𝑒𝑛𝑠𝑖𝑜𝑛 𝑖𝑛 𝑡ℎ𝑒 𝑐𝑎𝑙𝑐𝑢𝑙𝑎𝑡𝑖𝑜𝑛 𝑜𝑓 𝐺𝐷𝑃 𝑎𝑛𝑑 𝑡ℎ𝑒 𝑠𝑒𝑐𝑜𝑛𝑑 𝑖𝑠 𝑡ℎ𝑎𝑡 𝑖𝑡 𝑠𝑢𝑝𝑝𝑜𝑟𝑡𝑠 𝑠𝑢𝑠𝑡𝑎𝑖𝑛𝑎𝑏𝑙𝑒 𝑑𝑒𝑣𝑒𝑙𝑜𝑝𝑚𝑒𝑛𝑡 𝑎𝑛𝑑 𝑖𝑛𝑣𝑜𝑙𝑣𝑒𝑠 𝑡ℎ𝑒 𝑐𝑜𝑛𝑠𝑒𝑛𝑠𝑢𝑠 𝑓𝑜𝑟 𝑐𝑜𝑚𝑖𝑛𝑔 𝑔𝑒𝑛𝑒𝑟𝑎𝑡𝑖𝑜𝑛𝑠 𝑡𝑜𝑜.

The major motive behind accounting of green GDP includes to provide a more correct measure of welfare and to examine the sustainability of the economy. It has now become a significant basis to develop and implement sustainable strategies around the globe.

𝑨𝒓𝒈𝒖𝒎𝒆𝒏𝒕𝒔 𝒊𝒏 𝒇𝒂𝒗𝒐𝒓 𝒐𝒇 𝑮𝒓𝒆𝒆𝒏 𝑮𝑫𝑷

𝑇ℎ𝑒 𝑖𝑛𝑡𝑒𝑟𝑟𝑒𝑙𝑎𝑡𝑖𝑜𝑛 𝑏𝑒𝑡𝑤𝑒𝑒𝑛 𝑚𝑎𝑟𝑘𝑒𝑡 𝑎𝑛𝑑 𝑛𝑎𝑡𝑢𝑟𝑒

The main belief of Green GDP is that the market and nature are not mutually exclusive variables. Both are interrelated. Green GDP is the concept relating to regulating such a relationship.

𝐶𝑜𝑚𝑝𝑎𝑟𝑖𝑠𝑜𝑛 𝑎𝑐𝑟𝑜𝑠𝑠 𝑝𝑒𝑒𝑟𝑠 𝑎𝑛𝑑 𝑝𝑒𝑟𝑖𝑜𝑑𝑠

The Green GDP concept is also useful to compare a county’s environmental status from one period to another as well as with other countries. This will help to trace, analyze, and predict the growth of the economies more accurately.

𝐴𝑐𝑐𝑜𝑢𝑛𝑡𝑎𝑏𝑖𝑙𝑖𝑡𝑦

The account of Green GDP at least make countries responsible and accountable for sustainable development and preservation of natural resources.

Thus, the Green GDP concept has made a new connection between economic and environmental concepts and made existing connections more concrete. Mare accurate assessment of true national product and well being of the people come with an accounting of Green GDP rather than classic nominal GDP. However, it cannot replace the traditional GDP measures but must be an attempt in contemplating an unfavorable feature of economic progress and its sustainability.

Credit:https://enotesworld.com/