In the context of environmental economics applied to Arunachal Pradesh, what economic dilemma arises from balancing extensive forest cover with commercial timber extraction or infrastructure projects?

💡 Solution & Explanation

Arunachal Pradesh holds some of India's richest forest biodiversity, creating a fundamental economic dilemma between pursuing immediate revenue through resource extraction and preserving vital ecological services that benefit the entire nation. Economists often advocate for ecological compensation or green GDP accounting to value carbon sequestration and watershed protection services provided by the state's forests. Sustainable development models seek to reconcile livelihoods with conservation mandates. Timber harvesting policies are tightly regulated by judicial and statutory guidelines.