The endangered Indian Royal Tiger is a species whose habitat is under threat from misaligned incentives. The risk is most pronounced in areas where the interests of the locals might come into conflict with the desire to preserve the tiger habitats: areas such as the Shencottah Gap, between Periyar and Kalakad Mundanthurai Tiger Reserves in Western Ghats. But now a US$1.2 million dollar project, co-sponsored by the National Tiger Conservation Authority India and the Critical Ecosystem Partnership Fund, aims to design and implement incentives to protect these key areas.

Faced with this unique challenge, the team of experts from Australian and Indian institutions seeks to align social and individual incentives to “bridge the Shencottah Gap”. They plan to design a program of incentives to make it in the interest of local land-holders to use the land in ways that lead to a healthier and more productive forest. Similar model programs have been successful in the Australian context: the challenge is re-invent them to tackle the situation in India. The team will also develop incentive programs for local individuals and communities to combat environmental threats from human activities such as poaching and fires.

A project of this complexity requires the participation of experts from diverse institutions. Economists such as Peter Bardsley from the University of Melbourne and Gary Stoneham (pictured) from the Victorian Department of Treasury and Finance bring their expertise in the design and implementation of incentives regarding ecoservices. The Indian Statistical Institute brings expertise in environmental economics and incentives, while the Foundation for Ecological Research, Advocacy and Learning brings knowledge of the habitat ecology and local situation.

Currently, the team is in the process of developing the project framework. Initially, information must be gathered to identify where the most effective intervention is possible, to ensure that the project uses resources efficiently. Therefore, the project will start small by using well defined pilot experiments to build experience, allow for adaptation and redesign, and building relations with the community. The team will ensure from the design stage that the costs, benefits and outcomes of the intervention are documented and evaluated transparently.

Voluntary participation is crucial for success, so individuals and communities must benefit both from participation and from the overall success of the project. The participants must be fairly compensated for their role in providing public goods, and share in the productivity gains generated for the region as a result. The program will link benefits for the participants to actions and to outcomes, aiming to align incentives as closely as possible in the short, medium and long term. The team’s main task is to design protocols and manage the intervention to minimise the chance of negative side effects.

The program will aim to target the most influential agents for participation, and to use auctions and competitive mechanisms to identify the agents who can participate at least cost, thereby maximising project resources. In order to enhance effectiveness, education and training will be a key part of ensuring that participants become skilful custodians of the ecosystem.

The Shencotta Gap project has important implications in the context of India’s current economic transition. The team will consider this unique situation when assessing the value of environmental public goods and understanding what is a reasonable cost for their protection. India’s rapid economic development means that in the future, the society will be likely to value environmental goods even more highly than they do today. This makes effective intervention using precise, targeted incentive mechanisms to address the situation of the Royal Tiger all the more important.