Assignment No.

1B

Impact of Climate Change on Indian Economy

AJAY KUMAR
SCHOOL OF MANAGEMENT STUDIES UNIVERSITY OF HYDERABAD

The whole world is looking towards the consequences of climate change and Chindia economic

growth. This paper will conceptualise the impacts of climate change on Indian industries by

highlighting examples across the world. This approach will guide us to adopt suitable measure(s) to

check the negative impacts of climate change on Indian economy. We conclude the paper in the

presence of uncertainties related to climate change pattern and comeback of developed economies.

Please do not get surprise!

I think there is no positive impact of climate change on economies (environmental,

equity or ecology) anywhere in the world. Climate is dynamic. Then why we are worried about

climate change. Because, natural climate change may took millions of years. But the ‘Climate change’

we are facing, the maximum change in last 420, 000 years, is an inevitable increase of 2 degree

Celsius global temperature by 2050. It is a change not only in precipitation but complete seasons, not

only in temperature variation but complete energy cycle, not only air flow but complete biodiversity

pattern, and not only water bodies but new political maps. The picture is lifeless. It is true in Indian

context too. Please do not get surprise!

Impact on Agriculture, Fishery, and Forest.

According to Sathaye et al (2006) our systems are going to face an increase of 5.8 degree

Celsius by 2100 that will have severe impact on crop production, sea level global hydrological

systems, and ecosystems. It would be mainly for tropical areas including India. We have around 700

million rural populations dependent on climate sensitive economic sectors like agriculture, forests,

and fisheries for food and livelihoods.

 Agriculture is nature based economic activity. It will incur huge loss in the presence of

changing rainfall or season pattern. According to Rosenzweig & Parry (1994) production in the

developed world benefited from climate change, where as production in developing nations declined.

South Asia will incur maximum negative impact on yield (Nelson et al, 2009). Crops would be able to

sustain such huge change. It will lead to acute food shortage and higher prices. It will become more

difficult to predict the yield under the changing natural conditions. That may result in further change

in land-use pattern which lead to replacement of agriculture with some other industry. Hence, they

have to migrate to the urban places to work as labourers. In more pathetic conditions they may have to

work as labourers on their own land. It would be economic cum social-status loss for farm owners.

The climate change will have most visible impact on the sea level and change in underwater

resources. Climate change will have serious consequences for fishes, tourism, coastal protection, and

people. Under-resourced and developing countries have the lowest capacity to respond to climate

change (Hough-Guldberg, 2007). They found that climate change will exert danger on people,

infrastructure, and mangroves due to growing wave and storm impacts. There will be loss of Asian

coral reefs which are home of around one-fourth of the annual fish catch and food to about 1 billion

people. India have more than seven thousand kilometres coastline which supports millions’ food and

business requirements. Climate change can have drastic impact on the population and species

survival. It can take livings of the thousand innocents just to compensate the development taking

place somewhere else.

Climate impact assessments using BIOME-3 model and climate projection for the year 2085

shows a shift towards wetter forests in the north-eastern region and drier forest types in the north-

western region in the absence of human influence. Any change in the pattern of Indian forest is an

alarm for both government and people because it cost money in relocation or rehabilitation of people

and lead to loss of traditional knowledge and culture. Even, Indian economist plan for forestation to

reduce the carbon emission. Parikh and Parikh have argued (2002) that forest absorb carbon only

during the growth phase. By the time trees are mature they will become economic liabilities in terms

of land accumulation.
Investment for Healthy Economy: Education, Energy, and Ecology

“People involved in industry often refer to a product’s ‘life cycle.’... We want them to

live with us, to belong to us. In Western society, people have graves, and so do

products... We like to buy things that are brand-new, made of materials that are ‘virgin.’...

We recognize and understood the value of feeling special, even unique... What would

have happened, we sometimes wonder, if the Industrial Revolution had taken place in

societies that emphasize the community over the individual, and where people believed

not in cradle-to-grave life cycle but in reincarnation?” Braungart, M. & McDonough, W.

(2009)

Michael Braungart and William McDonough have beautifully canvassed the inefficiency

of our economies. Below figure 1, based on Jannie M. Benyus, remarkably exhibit the

logic of recycling.

Oxygenate De-oxygenate
Blood (Products Economy Blood (Used
or Services) Products,
service, waste)

Reincarnation or
Recycling

Figure 1 HEALTHY ECONOMY

At present none has proposed an alternative of capitalism (economies). At least we have some

initiatives towards ‘healthy economy.’ Healthy economy can be understood as a cyclic use of limited

resources like blood circulation in our body through heart. As Jannie M. Benyus discussed that we

have a long list of industries working as arteries but there are huge gap for veins to complete the

circulation. The knowledge and adoption of circulation of used products and services only can reduce

the problems of scarcity resources and their efficient use. How to achieve that healthy economy?

Healthy economy requires investment in education, energy and ecology.

 David Orr author of Ecological Literacy alleged the people with B.A., M.B.A., Ph.D., and

M.Sc. to pollute the environment. He placed special role for education to make people sensitive and

caring towards their environment. He found education being fabricated in different disciplines without

much interaction and interdisciplinary research. As result each time we analyse the situation, we see

only one face of the problem. Indian educational institutions require investment to develop new

disciplines and to take sustainability education at ground level especially in urban areas. Even if we

adopt renewable resources, to refine and develop the technology we have to re-examine our

curriculum and research agendas.

Energy is soul of economies. It helps them to grow, produce and continue the cycle. Largely

Indian economy runs on electricity or other non-renewable sources of energy. To mitigate the impact

of climate change we need to switch to renewable sources of energy like solar, hydro, wind, or

thermal. Being developing economy, we lack green technologies. And, every time we have to look

towards the western nations on high consultancy costs. Again role of education and research is being

emphasized to develop green technologies according to local Indian conditions. We need to take some

bold decision like Germany to shift energy demand towards green and clean energy alternatives.

To mitigate climate impact we need to invest in ecology. Point is climate change means

no normal life-cycles. It will help to monitor the amount of resources consumed or degraded to fuel

the economy as well as, to understand the complexities of climate change on agriculture, fishery, and

forest ecology for developing economies. And India is going to be from developing status to

developed, sooner or later. My fingers are crossed to see the results of this shift. What India is going

to be? I am not sure.

Notes:

1. Germany has announced to shut down their nuclear plants by 2022.

http://www.bbc.co.uk/news/world-europe-13592208
 References

Benyus, J.M. (2002). Biomimicry: innovation inspired by nature. HarperCollins, New York.

Braungart, M. & McDonough, W. (2009). Cradle to Cradle: re-making we make things. Vintage

Books. London.

Hoogh-Guldberg, O. (2007). Coral reefs under rapid climate change and ocean acidification. Science,

318, 1737-1742.

King, D.A. (2004). Climate change science: adopt, mitigate, or ignore? Science 203, 176-177.

Parikh, J.K. & Parikh, K. (2002). Climate change: India’s perceptions, positions, policies and

possibilities. Climate Change and Development, OECD.

Rosenzweig, C. & Parry, M.L. (1994). Potential impact of climate change on world food supply.

Nature, 367, 133-139.

Sathaye, J., Shukla, P.R., & Ravindranath, N.H. (2006). Climate change, sustainable development and

India: global and national concern. Current Science, 90 (3), 314-325.