Governance of Commons and Institutional Reforms: A Case Study of Oil India Limited, Duliajan (Assam) and Commons in Context of Poverty

Abstract

"This paper studies the environmental implications of operations of the Oil India Limited (OIL) located at Duliajan in the state of Assam in India. The study, in context of OIL, examines the impact of extraction of crude oil and natural gas on Common Property Resources (CPR) and violation of the core principle of Coase Theorem and associated problems with reference to the Commons. This paper focuses on the issue of governance and a case study of Commons in the context of formation water, seepages and leakages (due to operations of OIL) that contaminates and damages the water bodies including rivers and agricultural land owned collectively by poorer sections of the society with average incomes below $ 1 (one). This study also evaluates the loss of welfare of the local people living in the peripheral areas of the EPS and OCS due to the damages on Commons that goes uncompensated and the critical reasons behind total absence of its governance by regulators. Therefore, the paper attempts to explore sustainability of the commons, its governance and economic development incorporating stakeholders like marginal and poor farmers, tea tribe workers, regulators, etc. Parameters of Environmental Management System (EMS) of OIL and actual overall institutional governance of Commons by government regulators are examined to explore the possibilities of complementing economic development with ecological sustainability. The study critically evaluates absence of governance of Commons by regulators and tries to incorporate the External Costs with the Private Costs (of production) in order to derive a reflective and representative Social Cost of production. Finally, the paper provides policy prescriptions those are necessary conditions for meeting the environmental and social liabilities of the hydrocarbon industry, government regulators and also focuses on traditional management of commons by primitive and/or tribal societies for 'the sustainability of the Commons'."