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Given their increasing frequency, climate related disasters will result in 9 to 13 per cent of loss of GDP in India by 2010 and will be a key factor in preventing the economic growth in South Asia, a study has warned.
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Given their increasing frequency, climate related disasters will result in 9 to 13 per cent of loss of GDP in India by 2010 and will be a key factor in preventing the economic growth in South Asia, a study has warned. The Millennium Development Goals (MDGs) aim to halve world poverty by 2015. South Asian countries should include disaster-risk management in national strategic plans, the study 'Rethinking Disasters' released today by Oxfam said. Two to six per cent of South Asia’s gross domestic product is lost to disasters every year, the study said. The associated costs of climate change threaten to jeopardize South Asia’s growth. By 2010, the cost of climate change in India is estimated to result in 9 to 13 per cent loss of GDP, the study found. South Asia has become world's most disaster-prone region when it comes to natural calamities, the study claims.
Each new disaster deepens poor people’s vulnerability, does not allow them to enjoy the fruits of development and slows national growth, Nisha Agrawal, Oxfams CEO in India, said. The study said that two-third of South Asia’s disasters is climate related and rich countries are overwhelmingly responsible for the climate changes. An increase in temperature beyond two degrees Celsius will cause sea levels to rise, risking coastal flooding and salt-water infiltration into drinking water, it warned. The situation is aggravated by the low level of development which means more harm when it comes to human lives. On an average 50 poor countries are exposed to 11 per cent of the worlds natural hazards and they suffer 53 per cent of deaths due to these calamities each year. However, developed countries have exposure to 15 per cent of all hazards, but account for only 1.5 per cent of the deaths, the study, quoting UNDP, said. The study has found fault with South Asia’s approach to economic development which has allowed environmental destruction, increasing the risk of natural disasters. "India’s mangrove tree cover has been reduced to less than a third of its original area in the past three decades. After the tsunami in 2004, it became evident that the clearing of mangroves in India and Sri Lanka has left communities more vulnerable to the power of the waves," the study said.
The natural disasters in the region leave a trail of tragedy and destruction and arrest long-term development programmes. But nature alone cannot be blamed for the disasters. Factors like poverty, exclusion, inequality, inappropriate political decisions and actions also contribute to the damages by disasters. Disasters also cause supply-deficits and hoarding which lead to increase in inflation and affect the poor people, the study said.
Indian economy hit as industrial growth falls to 5%
Inflation figures are inching close to 12 per cent, industrial output is down nearly half of what it was last year. Friday saw the three I's - which hit sentiment hard. First came Infosys results at 9:00 AM, which hit market sentiment and technology stocks. Then at 11:30 AM, inflation rose further to 11.89 per cent. However, the hardest knock of all was that industrial growth has slowed down much more than expected. At five per cent, it was half of what it was earlier. “The worrying factor is despite the slowdown in overall IIP numbers, we have been witnessing a robust number as far as the capital goods sector is concerned. But the number that has come today shows a considerable decline also,” says Head and Senior Economist, Sunil K Sinha. “Growth is beginning to happen. It will be universal growth for the next three quarters,” says DG, National Council for Applied Economic Research, Suman K Bery. The question whether the slowdown is going to be alarming will take some more time to become clear. What is clear is that inflation is showing no signs of stopping in its tracks. “RBI action is very clear from here on. With oil prices not looking to ease off in the near future, it is quite clear that RBI will have to tighten monetary policy even more. One could see another 50 basis point hike in Repo rate, and in terms of yield curve action, we would see upward pressure on interest rates continuing,” says Senior Economist ABN AMRO Bank, Gaurav Kapur. Finally, Infosys sentiment to 'fog on the windscreen' when it came to business in the US has been replaced by 'cautious optimism’. Meanwhile, it seems that the outlook on Indian economy is becoming hazier and if the trend continues, the consumers and investors may suffer.
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