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Climate Change Could Depress Living Standards

in India, says New World Bank Report

4-5 minutes

The report provides long-term forecasts at the district level across India

NEW DELHI, June 28, 2018 – Rising temperatures and changing

monsoon rainfall patterns from climate change could cost India 2.8
percent of GDP and depress the living standards of nearly half the
country’s population by 2050, a World Bank report says.

According to “South Asia’s Hotspots: The Impact of Temperature and

Precipitation Changes on Living Standards”, almost half of South Asia’s
population, including India, now lives in the vulnerable areas and will
su�er from declining living standards that could be attributed to
falling agricultural yields, lower labor productivity or related health
impacts. Some of these areas are already less developed, su�er from
poor connectivity and are water stressed.

India’s average annual temperatures are expected to rise by 1.00°C to

2°C by 2050 even if preventive measures are taken along the lines of
those recommended by the Paris climate change agreement of 2015. If
no measures are taken average temperatures in India are predicted to
increase by 1.5°C to 3°C.

The work scienti�cally identi�es vulnerable states and districts as

“hotspots” using spatial granular climate and household data analysis.
The report de�nes hotspot as a location where changes in average
temperature and precipitation will have a negative e�ect on living
standards. These hotspots are not only necessarily higher temperature
zones than the surrounding areas, but also re�ect the local
population’s socio-economic capacity to cope with the climatic
changes.

In India today, approximately 600 million people live in locations that

could either become moderate or severe hotspots by 2050 under a
business-as-usual scenario, the report says. States in the central,
northern and north-western parts of India emerge as most vulnerable
to changes in average temperature and precipitation.

According to the report’s analysis, by 2050 Chhattisgarh and

Madhya Pradesh are predicted to be the top two climate hotspot
states and are likely to experience a decline of more than 9 percent in
their living standards, followed by Rajasthan, Uttar Pradesh, and
Maharashtra. Seven out of the top 10 most-a�ected hotspot
districts will belong to the Vidarbha region of Maharashtra.

“These weather changes will result in lower per capita consumption levels
that could further increase poverty and inequality in one of the poorest
regions of the world, South Asia,” says report author Muthukumara
Mani, a Lead Economist in the South Asia Region of the World Bank.
“Identifying hotspots will help policymakers in �nding speci�c locations
and household types where the resources are needed the most to address
the rising risk to living standards.”

The report provides options to prioritize investments and strategies to

build local resilience to climate change. To o�set the negative
economic impact in India, for example, the analysis suggests
enhancing educational attainment, reducing water stress, and
improving job opportunities in the nonagricultural sectors. The
analysis predicts that a 30 percent improvement on these
measures could halt the decline in living standards by almost 1
percent from -2.8 percent to -1.9 percent.

Muthukumara Mani adds: “Development is indeed the best adaptation

strategy, since it is associated with improved infrastructure, market-
oriented reforms, enhanced human capabilities, and a stronger institutional
capacity to respond to the increasing threat of climate change and natural
disasters.”