<h4>What is Green Gross Domestic Product (Green GDP)?</h4><p>The concept of <strong>Green Gross Domestic Product (Green GDP)</strong> emerged as a response to the limitations of traditional economic indicators. It aims to provide a more holistic measure of a nation's economic health.</p><div class='info-box'><p><strong>Traditional GDP:</strong> This metric represents the total <strong>annual value</strong> of all <strong>goods and services</strong> produced within a country's borders. It has served as the global standard for economic measurement since <strong>1944</strong>.</p></div><p>However, the creator of <strong>GDP</strong>, economist <strong>Simon Kuznets</strong>, himself acknowledged its shortcomings. He stated that <strong>GDP</strong> does not accurately reflect a nation's true welfare.</p><p>This is because <strong>traditional GDP</strong> overlooks crucial aspects such as <strong>environmental health</strong> and overall <strong>social well-being</strong>, focusing purely on economic output.</p><div class='key-point-box'><p><strong>Green GDP:</strong> This is a modified version of the conventional <strong>GDP</strong>. Its primary objective is to incorporate the <strong>environmental costs</strong> associated with economic activities into the national accounting framework.</p></div><p>It explicitly accounts for negative externalities. These include factors like the <strong>depletion of natural resources</strong>, the extent of <strong>environmental degradation</strong>, and the loss of <strong>biodiversity</strong> resulting from production and consumption.</p><div class='exam-tip-box'><p>Understanding the distinction between <strong>Traditional GDP</strong> and <strong>Green GDP</strong> is vital for UPSC Mains <strong>GS-III (Economy & Environment)</strong>. Questions often revolve around sustainable development indicators.</p></div>