Environmental economics

All the green initiatives out there today require a certain green premium, and it is questionable whether most people are willing to pay it. As with organic food, people agree to spend a premium on top of the basic food price. Most people would rather avoid the green premium and many simply cannot afford it. As such, environmental issues can often become a proxy for class conflicts at the domestic level and the former empires and their former colonies at the global level. For developing countries like Pakistan, with inflation taking off like never before, the green premium does not enter the picture at all.

Buses running on electric energy appear to be a jump start for an overall green adoption, but the truth is that this is mostly just optics. Pakistan does not have enough sources of green energy installed to cater to the overall economic demand in the near future. Customers, already burdened by high prices, would break out into revolt rather than pay even more for a greener product. Changing this picture requires more economic development and transitioning into a majority-middle class country.

Yasser Shah

Lahore