Question

The contribution of the Forest sector to the Indian Gross Domestic Production is

• A. More than 5 per cent
• B. Around 10 per cent
• C. Around 7 per cent
• D. Less than 2 per cent

Hint:

While forests provide nearly 1.7% of GDP directly, their indirect contribution through ecosystem services is estimated to be many times higher. Always differentiate between 'direct' and 'total' economic value in forestry.

Answer 1

The Correct Option is D

Step 1: Understanding the Question:
The question asks for the approximate contribution of the forestry and logging sector to the National Gross Domestic Product (GDP) of India.
This is a critical metric in forest economics, reflecting the direct monetary value generated by timber, fuelwood, and minor forest produce.

Step 2: Detailed Explanation:

• Sectoral Contribution: Historically, the forestry and logging sector in India has contributed a relatively small percentage to the overall national GDP compared to agriculture and services.

• Statistical Data: According to data from the Ministry of Statistics and Programme Implementation (MOSPI) and various Economic Surveys, the Gross Value Added (GVA) from forestry and logging usually ranges between 1.5% and 1.7% of the total GDP.

• Valuation Issues: It is widely acknowledged by economists that this figure is an undervaluation. It primarily accounts for products that enter the formal market, such as industrial timber and recorded minor forest produce (MFP).

• Ecosystem Services: The current GDP calculation does not fully integrate the value of ecosystem services provided by forests, such as carbon sequestration, oxygen production, soil conservation, and groundwater recharge. If these were quantified, the contribution would be significantly higher.

• Subsistence Use: A large portion of forest-based livelihoods, especially fuelwood and fodder collection by rural communities, remains unrecorded in formal national accounting.

Step 3: Final Answer:
Based on official government records, the contribution of the forest sector to the Indian GDP is consistently Less than 2 per cent.