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Opinion: Building better disaster resilience | February 14, 2022
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The current budgetary allocation for disaster management under the aegis of Ministry of Home Affairs is Rs 493 crore in 2022-23, which is only 2% higher than the last fiscal year. This fund is available for specific natural disasters for financing immediate relief measures and emergency response to affected people in the aftermath of disasters.

The Central government has promoted disaster mitigation and adaptation measures by allocating funds through various ministries. For instance, the government has allocated funds for the Climate Change Action Plan, National Adaptation Fund, National Coastal Mission under the Ministry of Environment, Forests and Climate Change.

Moreover, under the Ministry of Agriculture and Farmers’ Welfare, Rs 15,500 crore has been allocated for crop insurance schemes like Pradhan Mantri Fasal Bima Yojana. This scheme has provided insurance coverage against crop failures resulting from natural disasters and helped farmers stabilise their income.


In addition, the government has allocated Rs 3,101 crore under different heads for flood control and mitigation measures such as improving flood warning and forecasting, flood control and drainage, interlinking of rivers, and flood management and border areas programme. Under the Pradhan Mantri Awas Yojana-Gramin (PMAY-G), a major thrust has been placed on providing strong houses to poor and vulnerable populations. These measures have helped reduce disaster-related fatalities and damage in the States. However, the mitigation effect is limited.

In sum, the government of India has allocated Rs 19,379 crore under different heads for disaster management and mitigation measures in fiscal 2022-23, which is 0.08% of last year’s GDP. According to the Emergency Events Database (EM-DAT), around 1,927 people have died, 3.8 million people were affected, and economic losses stood at Rs 50,225 crore due to major natural disasters such as cyclones, floods and landslides that took place in the country in 2021. The total economic losses due to disasters in 2021 accounted for 0.21% of the GDP. Data shows that India has lost a greater proportion of its GDP than the corresponding budgetary allocation for disaster management and mitigation measures.

Therefore, the budgetary allocation is inadequate to mitigate disaster impacts in the States.
For many decades, India has been hit by some of the world’s worst natural disasters, which have severely affected various regions of the Indian subcontinent, have caused loss of life and property, and have negatively affected the livelihoods of the vulnerable population. According to the Central Water Commission (CWC) report, 1,13,943 people were killed, and damage due to floods were estimated at Rs 4,37,149.7 crore over the period 1953-2020. In addition, 12,388 people were killed, and damage was estimated at $32,615 million due to cyclones over the period 1999-2020. Therefore, it is essential to introduce disaster risk reduction measures.

Marginal Money

The Second Finance Commission initiated the ‘marginal money’ scheme and provided guidelines to the Central government to finance State governments to meet their expenditures on natural calamities. In the subsequent revision, the 9th Finance Commission introduced the Calamity Relief Fund (CRF), and it continued until the 12th Finance Commission. In this framework, 75% of disaster grants are financed by the Centre, and 25% by the respective non-special categories States. In addition, the 10th Finance Commission recommended setting up a National Fund for Calamity Relief (NFCR) for providing additional assistance in terms of soft loans and new grants to respective States based on ‘calamity of rare severity’ in nature. The amount of assistance released by the Centre depends on the severity of disasters, the State’s memoranda related to disaster damage, and assessment of damage by the Central team.

The 10th Finance Commission introduced the concept of declaring a natural disaster a ”National calamity’, however, the panel did not define any guidelines for categorising natural disasters as ‘National calamity.’ Until now, the government of India has declared the 2001 Gujarat earthquake and 2014 J&K flood as national calamities. Moreover, different States have experienced many devastating floods and cyclones, and opposition parties have demanded that those disasters be declared as ‘national calamities’. However, there is a lack of coordination between the Centre, States, and the opposition parties on declaring disasters as ‘National calamities’.

Following the introduction of the Disaster Management Act in 2005, the 13th Finance Commission advocated merging and transferring the balance of National Calamity Contingency Fund (NCCF) to National Disaster Response Fund (NDRF) and renamed CRF as State Disaster Response Fund (SDRF) in 2010. This fund was utilised for post-disaster management activities such as response, relief, preparedness and reconstruction. However, the mitigation plan that requires sustained action to reduce the long-term risks of disaster damage was not addressed by any Finance Commission. The ex-post disaster grant and subsequent modifications and renaming of the disaster fund schemes have not significantly helped mitigate damage and fatalities due to natural disasters.

Policy Failures

Moreover, multiple policy recommendations have failed to succeed in disaster mitigation at the national and State levels. The CWC data shows that damage due to floods increased from Rs 52 crore in 1953 to Rs 21,189 crore in 2020. The number of deaths due to floods also increased from 37 to 1,815 during this period.

Based on disaster-related deaths and damage, the 15th Finance Commission introduced disaster mitigation funds at State and national levels to lessen the adverse impact of disasters. The commission recommended that 80% of funds should be used for disaster relief, recovery and preparedness. The remaining 20% should be used for disaster mitigation purposes. This new public initiative on disaster mitigation will help minimise the adverse impact of disasters to a more considerable extent.

Although the 15th Finance Commission has taken a major step for disaster risk reduction, there are a few crucial areas where we need public intervention. First, the government should re-estimate flood-prone and drought-prone areas using scientific methods. This will help in developing pre-and post-disaster needs assessment strategies. Second, building storm-surge resilient embankments, underground power connections, implementing river reforms, increasing mangroves plantation and introducing disaster preparedness measures in the school curriculum are crucial.

Third, the government should officially declare heatwaves and lightning as ‘natural disasters’ because more deaths occur due to them than other types of disasters. All these measures will help the Central government prepare a national-level action plan with the joint involvement of State governments and local administration, as suggested by the Sendai Framework for Disaster Risk Reduction.

Further, using Artificial Intelligence (AI) in developing early warnings can greatly help manage natural disasters. In addition, creating a national disaster database, increasing budgetary allocation towards disaster mitigation, and better coordination among Central, State governments and local administrations are essential for preventing losses from natural disasters.

(Yashobanta Parida and Joyita Roy Chowdhury are Assistant Professors of Economics at FLAME University, Pune. Prakash Kumar Sahoo is a Lecturer of Economics at Vikram Deb (Autonomous) College, Jeypore, Odisha. Views are personal)