Current Science

Open Access Open Access  Restricted Access Subscription Access

Assessing the Costs of Droughts in Rural India: A Comparison of Economic and Non-Economic Loss and Damage


Affiliations
1 Department of Humanities and Social Sciences, Indian Institute of Technology Tirupati, Tirupati 517 506, India
 

Drought, recognized as one of the major disasters, negatively affects India’s agrarian economy, and in turn, farmers’ well-being. Households incur both economic and non-economic loss and damage. The latter is most often unnoticed and unaddressed although it is expected to be quite significant in developing nations. Understanding and assessing loss and damage are the prime objectives of the Warsaw International Mechanism. While numerous studies have emerged to estimate the impact on crop production, income, on-farm employment and financial status, there are only limited studies with respect to assessing loss and damage to intangible resources and the total cost of a drought in particular. By interviewing droughtaffected farmers in the Kutch district of Gujarat state, this study aims to understand the perception of farmers and to estimate total economic value and noneconomic loss and damage. A contingent valuation method was employed. In sum, two major findings emerged: (i) intensity of economic loss and damage is perceived as relatively high as compared to noneconomic loss and damage, although the reverse was expected, and (ii) the average total economic value of a drought was INR 8303, and the mean value of noneconomic loss and damage was INR 4831. This study reveals that households give lower value to intangible losses that occurs over a period than the immediate tangible loss and damage which directly affect their total wealth. Given this, community-level adaptations to minimize non-economic loss and damage are less likely to be formulated. From the policy perspective, this study strongly advocates the evaluation of intangible costs, so that upcoming state action plans, disaster management plans and ex-post assessment reports could be tailored accordingly for minimizing these risks.

Keywords

Agrarian Economy, Drought, Non-Economic Loss And Damage, Rural Areas.
User
Notifications
Font Size

  • Ladds, M., Keating, A., Handmer, J. and Magee, L., How much does disaster cost? A comparison of disaster cost estimates in Australia. Int. J. Disaster Risk Reduct., 2017, 21, 419–429.

  • Mechler, R. and Schinko, T., Identifying the policy space for climate loss and damage. Science, 2016, 354(6310), 290–292.

  • ECLAC, Handbook for Estimating the Socio-economic and Environmental Effects of Disasters, Economic Commission for Latin America and the Caribbean, 2003.

  • Warner, K. and van der Geest, K., Loss and damage from climate change: local-level evidence from nine vulnerable countries. Int. J. Global Warm., 2013, 5(4), 367–386.

  • Kunzel, V., Schafer, L., Manninger, S. and Baldrich, R., Loss and damage at COP23: looking at small island developing states. Policy Report, Germanwatch, Bonn, Germany, 2017.

  • Serdeczny, O. M., Bauer, S. and Huq, S., Non-economic losses from climate change: opportunities for policy oriented research. Climate Dev., 2018, 10(2), 97–101.

  • Hallegatte, S., Natural Disasters and Climate Change: An Economic Perspective, Springer International Publishing, Switzerland, 2014.

  • Bahinipati, C. S., Rajasekar, U., Acharya, A. and Patel, M., Floodinduced loss and damage to textile industry in Surat city, India. Environ. Urban. Asia, 2017, 8(2), 170–187.

  • Government of Odisha, Cyclone Fani: Damage, Loss, and Need assessment, ADB and the World Bank, 2019; http://digitallibrary.in.one.un.org/TempPdfFiles/3965_1.pdf (accessed on 20 August 2019).

  • Ranger, N. et al., An assessment of potential impact of climate change on flood risk in Mumbai. Climatic Change, 2011, 104, 139–167.

  • Patankar, A. and Patwardhan, A., Estimating the uninsured losses due to extreme weather events and implications for informal sector vulnerability: a case study of Mumbai, India. Nat. Hazards, 2016, 80(1), 285–310.

  • Birkmann, J. and Welle, T., Assessing the risk of loss and damage: exposure, vulnerability and risk to climate related hazards for different country classifications. Int. J. Global Warm., 2015, 8(2), 191–212.

  • Bahinipati, C. S., Patnaik, U. and Viswanathan, P. K., What causes economics losses from natural disasters in India? In Handbook of Research on Climate Change Impact on Health and Environmental Sustainability (ed. Dinda, S.), IGI Global Publisher, USA, 2016, pp. 157–175.

  • Roy, A. and Hirway, I., Multiple impacts of droughts and assessment of drought policy in major drought prone states in India. Project report submitted to the Planning Commission, Government of India, 2007.

  • Udmale, P., Ichikawa, Y., Manadhar, S., Ishidaira, H. and Kiem, A. S., Farmers’ perception of drought impacts, local adaptation and administrative mitigation measures in Maharashtra state, India. Int. J. Disaster Risk Reduct., 2014, 10, 250–269.

  • Udmale, P., Ichikawa, Y., Manadhar, S., Ishidaira, H., Kiem, A. S., Shaowei, N. and Panda, S. N., How did the 2012 drought affect rural livelihoods in vulnerable areas? Empirical evidence from India. Int. J. Disaster Risk Reduct., 2015, 13, 454–469.

  • Zhang, X., Obringer, R., Wei, C., Chen, N. and Niyogi, D., Droughts in India from 1981 to 2013 and implications to wheat production. Sci. Rep., 2017, 7, 44552.

  • United Nations Framework Convention on Climate Change, Noneconomic losses in the context of the work programme on loss and damage, Technical Paper, 2013, pp. 1–22; http://unfccc.int/resource/docs/2013/tp/02.pdf (accessed on 1 August 2019).

  • Morrissey, J. and Oliver-Smith, A., Perspectives on non-economic loss and damage: understanding values at risk from climate change, 2013.

  • Fankhauser, S., Dietz, S. and Gradwell, P., Non-economic losses in the context of the UNFCCC work programme on loss and damage. Policy Paper, Centre for Climate Change Economics and Policy, Grantham Research Institute on Climate Change and the Environment, UK, 2014.

  • Hirsch, T., Minninger, S. and Wirsching, S., Non-economic loss and damage – with case examples from Tanzania, Ethiopia, El Salvador and Bangladesh. Bread for the World, Berlin, Germany, 2017.

  • Andrei, S., Rabbani, G. and Khan, H. I., Non-economic loss and damage caused by climatic stressors in selected coastal districts of Bangladesh. Bangladesh Centre for Advance Studies, 2014; http://www.icccad.net/wp-content/uploads/2016/02/ADB-StudyonNon-Economic-Losses-and-Damages-Report_Final-VersionReduced-File-Size.compressed1.pdf (accessed on 20 July 2019).

  • Chiba, Y., Shaw, R. and Prabhakar, S. V. R. K., Climate change related non-economic loss and damage in Bangladesh and Japan. Int. J. Climate Change Strat. Manage., 2017, 9(2), 166–183.

  • Sharma, S. and Majumdar, P., Increasing frequency and spatial extent of concurrent meteorological droughts and heat waves in India. Sci. Rep., 2017, 7, 1–9.

  • Mishra, V., Tiwari, A. D., Aadhar, A., Shah, R., Xiao, M., Pai, D. S. and Lettenmaier, D., Drought and famine in India, 1870–2016. Geophys. Res. Lett., 2019; https://doi.org/10.1029/2018GL081477.

  • NRAA, Contingency and compensatory agriculture plans for droughts and floods in India, 2012. Position Paper No. 6, National Rainfed Area Authority, New Delhi, 2013; http://nraa.gov.in/pdf/Droughts%20and%20Floods%20in%20India-2012.pdf (accessed on 20 June 2019).

  • Gupta, A., Tyagi, P. and Sehgal, V. K., Drought disaster challenges and mitigation in India: strategic appraisal. Curr. Sci., 2011, 100(12), 1795–1806.

  • Bahinipati, C. S., District-level estimation of development indicators for the state, Gujarat, Research Report submitted to the Indian Council of Social Science Research, New Delhi, India, 2015.

  • Mehta, N., An investigation into growth, instability and role of weather in Gujarat agriculture: 1981–2011. Agric. Econ. Res. Rev., 2013, 26, 43–55.

  • The Pioneer, Gujarat government declares 623 villages drought affected, 2016; http://www.dailypioneer.com/nation/gujarat-governmentdeclares-623-villages-drought-affected.html (accessed on 31 January 2017).

  • Mwinjaka, O., Gupta, J. and Bresser, T., Adaptation strategies of the poorest farmers in drought-prone Gujarat. Climate Develop., 2010, 2(4), 346–363.

  • Ganguli, P. and Reddy, M. J., Evaluation of trends and multivariate frequency analysis of droughts in three meteorological subdivisions of western India. Int. J. Climatol., 2014, 34, 911–928.

  • Mujumdar, S. S., Development of co-relationship between rainfall runoff surface and groundwater potential of Kutch region of Gujarat. Ph D thesis submitted to Maharaja Sayajirao University of Baroda, Gujarat, 2010; https://shodhganga.inflibnet.ac.in/handle/10603/59754 (accessed on 20 August 2019).

  • Government of Gujarat, Kutch District: Disaster Management Plan 2017–18, Gujarat State Disaster Management Authority, 2018; http://gsdma.org/uploads/Assets/ddmp/ddmpkutch2017full07122017010345285.pdf (accessed on 30 July 2018).

  • Pattanayak, S. and Kramer, R. A., Pricing ecological services: willingness to pay for drought mitigation from watershed protection in eastern Indonesia. Water Resour. Res., 2001, 37(3), 771–778.

  • Serdeczny, O., Waters, E. and Chan, S., Non-economic loss and damage in the context of climate change. Discussion Paper 3, German Development Institute, Bonn, Germany, 2016.

  • Reddy, A., Impact study of soil health card scheme. National Institute of Agricultural Extension Management, Hyderabad, 2017, p. 210; http://www.manage.gov.in/publications/reports/shc.pdf (accessed on 15 September 2018).

  • Pattnaik, I. et al., Agricultural extension service through Krishi Mahotsav in Gujarat: a preliminary assessment. GIDR Occasional Paper Series No. 2, Gujarat Institute of Development Research, Ahmedabad, 2012.

  • Dercon, S., Fate and fear: risks and its consequences in Africa. J. Afr. Econ., 2008, 17, ii97–ii127.

  • Kishore, A., Supply- and demand-side management of water in Gujarat, India: what can we learn? Water Policy, 2013, 15, 496– 514.

  • Bahinipati, C. S. and Viswanathan, P. K., Incentivizing resource efficient technologies in India: evidence from diffusion of microirrigation in the dark zone regions of Gujarat. Land Use Policy, 2019, 86, 253–260.

  • Viswanathan, B. and Kumar, K. S. K., Weather, agriculture and rural migration: evidence from state and district level migration in India. Environ. Dev. Econ., 2015, 20(4), 469–492.

  • Kahneman, D., Knetsch, J. L. and Thaler, R. H., The endowment effect, loss aversion, and status quo bias. J. Econ. Perspect., 1991, 5(1), 193–206.


Abstract Views: 271

PDF Views: 120




  • Assessing the Costs of Droughts in Rural India: A Comparison of Economic and Non-Economic Loss and Damage

Abstract Views: 271  |  PDF Views: 120

Authors

Chandra Sekhar Bahinipati
Department of Humanities and Social Sciences, Indian Institute of Technology Tirupati, Tirupati 517 506, India

Abstract


Drought, recognized as one of the major disasters, negatively affects India’s agrarian economy, and in turn, farmers’ well-being. Households incur both economic and non-economic loss and damage. The latter is most often unnoticed and unaddressed although it is expected to be quite significant in developing nations. Understanding and assessing loss and damage are the prime objectives of the Warsaw International Mechanism. While numerous studies have emerged to estimate the impact on crop production, income, on-farm employment and financial status, there are only limited studies with respect to assessing loss and damage to intangible resources and the total cost of a drought in particular. By interviewing droughtaffected farmers in the Kutch district of Gujarat state, this study aims to understand the perception of farmers and to estimate total economic value and noneconomic loss and damage. A contingent valuation method was employed. In sum, two major findings emerged: (i) intensity of economic loss and damage is perceived as relatively high as compared to noneconomic loss and damage, although the reverse was expected, and (ii) the average total economic value of a drought was INR 8303, and the mean value of noneconomic loss and damage was INR 4831. This study reveals that households give lower value to intangible losses that occurs over a period than the immediate tangible loss and damage which directly affect their total wealth. Given this, community-level adaptations to minimize non-economic loss and damage are less likely to be formulated. From the policy perspective, this study strongly advocates the evaluation of intangible costs, so that upcoming state action plans, disaster management plans and ex-post assessment reports could be tailored accordingly for minimizing these risks.

Keywords


Agrarian Economy, Drought, Non-Economic Loss And Damage, Rural Areas.

References





DOI: https://doi.org/10.18520/cs%2Fv118%2Fi11%2F1832-1841