Since 2019, Maharashtra spent ₹ 14K-crore as compensation for extreme weather events

Since 2019, Maharashtra has paid at least ₹14,000 crore – about 18% of the state’s fiscal deficit for financial year (FY) 2020-21 – as direct compensation to those affected by extreme weather events. This figure was brought out in a presentation made to the state cabinet on Wednesday by the environment department to highlight concerns raised in the Intergovernmental Panel on Climate Change’s (IPCC) sixth assessment report released last month.

The number is, however, a gross underestimation of the total cost of recent climate disasters in the state, officials and experts pointed out.

A government official privy to the development, on the condition of anonymity, said, “The numbers presented to the state cabinet are an overview of the most prominent disasters since 2019, such as Cyclones Kyarr, Nisarga and Tauktae, last year’s floods in Vidarbha and the recent Konkan floods. An amount of ₹14,000 crore was the outlay in compensation that was directly paid toward the rehabilitation of affected persons. The real cost of the disasters is of course much higher because a lot of money has to also be allocated toward infrastructure repairs.”

Last year alone, Maharashtra paid about ₹5,500 crore as compensation for extreme weather events, including hail storms, unseasonal rainfall, extended monsoon rainfall, cyclone, heat waves, lightning and cold waves, data obtained from the state disaster management authority and the environment and the climate change department has revealed.

Most of this amount was disbursed to farmers for agricultural damages – losses of property and crops – after a delay in withdrawal of monsoon led to unseasonal heavy rainfall and damage of harvested crops such as cotton, sugarcane, gram and several fruit harvests. Official data shows that agricultural damage was witnessed over 700,000 hectares across 10 districts in central and western Maharashtra, and almost 89,000 hectares across 36 talukas in the Vidarbha region.

But Maharashtra’s total cost incurred due to climate disasters for the year 2020 alone comes to a total of ₹13,000 crore, which includes at least another ₹4,000 crore spent toward fixing damaged roads, reinstating water supplies, refurbishing damaged power infrastructure and various other urban and rural infrastructure fixes, along with ex gratia payments made to victims of heat waves, cold waves and lightning strikes.

It also includes at least ₹568 crore that was spent on disaster relief after Cyclone Nisarga hit last June, along with about ₹912 crore that was spent on stormwater drains and flood mitigation projects in Mumbai alone. The Mumbai civic body also spent an additional ₹36 crore for building water-holding structures under the sponge city master plan, disaster management data shows.

This year, the state government has paid compensation of at least ₹227 crore directly to the victims of Cyclone Tauktae and Konkan floods, but the total cost of climate disasters in the ongoing calendar year is likely to be in excess of ₹11,500 crore (which is the strength of the relief package announced by the Maharashtra on August 2).

“We will have to wait and see how things pan out over the rest of the year. If there are unseasonal rains in October again and crop harvesting is affected, the total cost of climate related disasters will be higher than in 2020,” said the government official quoted above.

Even though experts were alarmed at the scale of these losses, they emphasized that the real cost of climate change-induced disasters are intangible.

“The government of Maharashtra, which at the very least is cognizant of emerging climate science, may have allotted ₹11,500 as relief to flood victims, but that will only make up for calculable losses and provide relief to the poorest of the poor. That compensation is necessary of course, but try and imagine for a second the larger economic losses that are incurred when hundreds of thousands of people cannot make it to work for a few days, and when thousands of businesses are forced to remain shut because of flooding. It is exponential when compared to the losses we calculate. The cost of our inaction against climate change will only increase unless we first learn to adapt to these emerging trends of extreme weather,” said Dr Anjal Prakash, research director at the Indian School of Business (ISB), and a lead author of the ongoing 6th Assessment Report of IPCC (where he is involved in the chapter on cities, settlements and key infrastructure).