ABSTRACT
Shared commitment for environmental protection has emerged as a contentious issue between the developed and developing countries (Barret 1994, Fairman and Ross 1996). The conventional wisdom is that the developed world has a greater stake in the long term benefits of environmental protection than the developing world, where the immediate need to increase consumption is paramount. Thus the poorer countries need external aid to encourage them to undertake conservation projects. External assistance - channelled through multi-lateral bodies such as the World Bank and bilateral agencies such as the British Overseas Development Agency - to India has accounted for almost half of the country’s outlay in the forest sector in recent years. This assistance has been provided as long-term loans, subsidised interest rates, and direct grants. The following question arises: what fraction of the cost should be borne by India? If the problem is conceived as a game between donor countries and India, then it is in the interest of India to get as high a fraction of the cost as she can negotiate to be reimbursed by external sources. Likewise, it is in the interest of these external agencies to get away with as little as they can to persuade India to undertake conservation projects. It is argued here that this particular formulation of the bargaining problem is unlikely to produce much benefit to either side, and that the environmental issues in forestry require a different approach to articulating the idea of mutually beneficial international co-operation.
