Disaster risks now a fiscal and growth challenge, says DEA secretary

DEA Secretary Anuradha Thakur said disaster risks are now a fiscal and development challenge, urging resilience to be embedded in infrastructure planning

Disaster risks have moved beyond environmental concerns to become a major development and fiscal challenge globally, Economic Affairs Secretary in the Finance Ministry Anuradha Thakur said on Wednesday.

 

Speaking at a conference organised by the Coalition for Disaster Resilient Infrastructure (CDRI) on “mobilising finance for resilience,” she cautioned that damaged roads, disrupted power systems, and flooded urban networks now directly erode economic growth, strain public finances, and undermine livelihoods—making disasters a core policy concern rather than a peripheral issue.

 

“For finance ministries and policy makers across the globe, it's not just an environmental concern, it is fundamentally a development and a fiscal challenge,” she noted. 

 

 

Thakur further said that resilience makes economic sense, wherein upfront strengthening slashes long-term costs, averts disruptions, and acts as a productivity enhancer, not a mere safeguard. “It is not merely a safeguard. In fact, it is a productivity-enhancing investment,” she emphasised. 

 

She also emphasised the inclusion of proactive disaster risk financing frameworks into public finance practices. “These frameworks are vital to safeguard national budgets, protect economic stability, and ensure sustainable growth,” she reckoned. 

 

Thakur highlighted a "fundamental shift" in disaster risks, where global incidents have surged nearly fivefold over the past five decades. "The question before us is no longer whether or at what scale the disaster would happen, but whether our infrastructure is ready going forward," she stated, underscoring that every shock leaves not just physical wreckage but a "huge bill for the exchequer". 

 

Resilience cannot remain an add-on but must be embedded from the project design stage in planning, financing, and execution, she noted.  The DEA secretary stressed that resilience is "a must" to protect investments and communities proactively, rather than retrofitting after calamity strikes. "We believe that resilience needs to be treated not as an afterthought but as a guiding principle in project structuring, financing, and delivery," she added.

 

According to Thakur, resilience needs to be mainstream and not marginalised. It requires mainstreaming into appraisal guidelines, procurement processes, and financing structures, with institutional alignment across ministries and agencies. 

 

She also stressed that partnerships are essential, especially for developing countries that face the highest risk with the least resources.

 

The "Mainstreaming Disaster Resilience into Infrastructure Projects" report launched at the event identifies five key gaps impeding resilience. These include standard contracts, gaps across the project lifecycle, weak data and risk systems, limited institutional capacity, and inadequate financing and risk coverage. 

 

The report argues resilience must shift from reactive fixes to proactive governance, aligning with 2047 vision for a $30 trillion economy. Without integration, annual losses could reverse development gains, as seen in Kerala floods and Cyclone Fani, where critical infrastructure accounted for nearly 50 per cent of direct losses. “Embedding disaster resilience into infrastructure development is not just a risk mitigation strategy; it is a foundational investment in the country's long-term growth and stability,” the report noted. 

 

To close these gaps, the report recommends mandatory hazard, risk, and vulnerability assessments for high-priority projects so that risk is identified before projects are approved. It also calls for explicit hazard thresholds to be written into agreements, which would make responsibilities clearer when disasters disrupt projects.

 

On the financing side, the report calls for the creation of an India Infrastructure Resilience Fund to help bridge the additional costs of resilience measures. It also suggests innovative financing and risk transfer tools, including sovereign risk pools and catastrophe bonds, to reduce the fiscal burden of future disasters.