Environmental impact assessment has been made statutory for 30 categories of developmental projects under various sectors like industrial, mining, power, transport and others which are listed below.

List of projects requiring environmental clearance from the central government is as follows:

1. Nuclear power and related projects such as heavy water plants, nuclear fuel complexes, rare earth plants.

2. River valley projects including hydel power, major irrigation and their combination including flood control.


3. Ports, harbours, airports (except minor ports and harbours).

4. Petroleum refineries including crude and product pipelines.

5. Chemical fertilizers (nitrogenous and phosphatic, other than single super phosphate).

6. Pesticides (technical).


7. Petrochemical complexes (both olefin and aromatic) and petro-chemical intermediates and production of basic plastics such as LDPE, HDPE, PP, PVC.

8. Bulk drugs and pharmaceuticals.

9. Exploration for oil and gas and their production, transportation and storage.

10. Synthetic rubber.


11. Asbestos and asbestos products.

12. Hydrocyanic acid and its derivatives.

13 (a) Primary metallurgical industries (such as production of iron and steel, aluminium, copper, zinc, lead and ferro alloys)

(b) Electric arc furnaces (mini steel plants).


14. Chlor-alkali industry.

15. Integrated paint complex including manufacture of resins and basic raw materials required in the manufacture of paints.

16. Viscose staple fibre and filament yarn.

17. Storage batteries integrated with manufacture of oxides of lead and lead antimony alloy.


18. All tourism projects between 200 and 500 m of high-tide line and at locations with an elevation of more than 1000 m, with an investment of more than Rs. 5 crores.

19. Thermal power plants.

20. Mining projects (major minerals) with leases more than 5 hectares.

21. Highway projects except projects relating to improvement work including widening and strengthening of roads with marginal land acquisition along the existing alignments provided it does not pass through ecologically sensitive areas such as national parks, sanctuaries, tiger reserves, reserve forests.


22. Tarred roads in the Himalayas and/or forest areas.

23. Distilleries.

24. Raw skins and hides.

25. Pulp, paper and newsprint.

26. Dyes.

27. Cement.

28. Foundries (individual).

29. Electroplating.

30. Meta Amino Phenol.

The Environment Impact Assessment Notification (1994) Section 2 states that:

“Any person who desires to undertake any project in many part of India or modernization of any existing industry or project listed in the above list shall submit an application to the secretary, Ministry of Environment and Forests, New Delhi, in the necessary proforma with sufficient and adequate data”.

Environmental audit

Environmental impact assessment is a must before setting up any large projects. It assesses and evaluates the impact of the project on the environment and its feasibility from the point of view of the environment. It can also pave the way for corrections, if needed, to the project’s lay-out, so that its adverse impact on the environment is reduced.

Environmental audit is a procedure to internally review and constantly evaluate any potential for liability to pollution. This becomes imperative because of the fact that many of the risks, hazards and liabilities might have been inconspicuous during the impact assessment stage. Hence, a periodic, documented, objective and self-evaluator report, which is being undertaken by the management of any project, is an environmental audit. When such a self- evaluation is being performed, it helps in the early detection of any shortcomings and provides for mid-course correction.

The concept of environmental auditing is closely related to monitoring, norms and standards.

Environmental Monitoring

Environmental monitoring is the systematic observation of the state of the environment and of the factors influencing it. Its main purposes are to forecast changes to the state of the environment and to provide initial data for planning documents, programmes and projects. The procedure of environmental monitoring shall be established by law.

Environmental Norms

Environmental norms are the use rates of natural resources per production unit established for the quality of the environment and the volume of waste, generated.

Environmental Standards

Environmental standards are documents, setting rules, guidelines and numeric values defined by the parties involved, and regulating the activities or results of activities which either have or are likely to have impact on the state of the environment.

During a typical environmental audit, a team of qualified inspectors conducts a comprehensive examination of a plant or other facility to determine whether it is complying with environmental laws and regulations. Using checklists and audit protocols and relying on professional judgment and evaluations of site-specific conditions, the team systematically verifies compliance with applicable requirements. The team may also evaluate the effectiveness of systems in place to manage compliance and assess the environmental risks associated with the facility’s operations.

Environmental economics

Environmental economics views the real economy in which we all live as a open system and the resources such as air and water as open-access resources. These open-access resources imply that no one owns them and there is no individual incentive to restrict pollution, when we look at it in an environmental perspective.

Environmental economics uses cost-benefit analysis to deal with environmental problems and issues. Benefits and damage assessments are used to integrate the worthless but valuable functions of natural environments, into projects and to illustrate the kinds of damage done to national economics by pollution.

Free-market transactions are more unregulated than in the sense of the term because some people pay for somebody else’s pollution. Take for example, an iron-ore mine which pollutes a river.

The people living downstream will have to clean up the water for drinking water purposes. Moreover, the agricultural lands may be rendered useless resulting in economic loss for the farmer. On a larger scale, this same pattern can be applied to issues such as global warming, climate change, etc.

Pollution cannot be eliminated but it can be controlled. Once the society decides on an acceptable level of environmental quality, it is necessary for the governments to intervene by setting command and control regulation and market-based incentives, and hence the ‘polluter pays’ principle.

The ‘polluter pays’ principle

The regulatory agencies which are entrusted with overseeing the implementation of the policies can adopt different methods to control pollution. They can charge any stipulated amount for the right to pollute and set regulations imposing limits on the amount of pollutant.

The ‘Emission Charges’ are prices established for the right to emit a unit of a pollutant. The ‘Emission Standards’ are limits established by the government on the annual amounts and kinds of pollutants by producers or users of certain products.

‘Pollution Rights’ are government-issued permits, allowing firms to emit a specified quantity of polluting wastes. The advantages of such permits are manifold: (i) pollution permits are tradable; (ii) regulatory authorities can control the amount of pollution (which can be region-based) by limiting the number of permits; (Hi) provides a choice, i.e., to purchase permits and pollute or reduce pollution and save costs; and (iv) provides an incentive to reduce emissions in order to sell previously purchased permits.