It's for pulling the rubber boot thru the tunnel. I forget which way it goes -- pull up thru the bottom or pull down thru the top. I think it's the former. Anyway, the nylon ring (is it green?) is just for helping to get the lips of the boot around the tunnel opening. Then you can cut it off with a pair of snips.
Getting the boot seated in the tunnel is the easy part. Fitting the shift lever properly into the center of the boot is where the fun begins.