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Why does Kerala need more funds?

Posted: Tuesday, August 28, 2018

Why does Kerala need more funds?

T. Nandakumar

AUGUST 25, 2018 20:27 IST

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Why does Kerala need more funds?


Kerala rains 2018

The Hindu Explains


What has been the damage?

As Kerala struggles to come to grips with the worst floods in its history, the reconstruction of damaged infrastructure and restoration of livelihoods pose a daunting challenge for the State government. Initial estimates put the loss at ₹20,000 crore but officials feel the extent of the damage could be more than twice the figure. “The total loss will probably run into billions of dollars. Think about Mississippi, Katrina and the Thailand floods — they all ran into tens of billions of dollars. Finding money to recover from this level of damage is difficult,” says G. Pramod Kumar, former adviser, UNDP.


Where will funds come from?

Following aerial surveys of the flood-affected areas by Prime Minister Narendra Modi and Home Minister Rajnath Singh, the Central government announced an interim relief of ₹600 crore for the State against a demand for ₹2,000 crore as emergency assistance. Having completed a week-long rescue operation with the help of the armed forces and the National Disaster Response Force, the State government announced a massive reconstruction programme. But mobilising resources for a project on this scale remains a challenge for the economy of the State that leans heavily on the diminishing remittances by a large diaspora.


How much has the CM collected? 

The Chief Minister’s Distress Relief Fund has mopped up ₹535 crore by way of donations by individuals, institutions and organisations across the world. 


Who suffered the most losses?

It is significant that a huge part of the destruction happened to private assets. The floods caused widespread damage to houses and property. According to Chief Minister Pinarayi Vijayan, 7,000 houses have been destroyed and 50,000 damaged in the floods. 

According to Mr. Kumar, the government may not have enough resources even to rebuild public assets such as roads, hospitals, schools and bridges. The private properties will have to be rebuilt by the people. “Where will they find the money? Nobody knows,” he points out.

Officials admit that the deluge has exposed the vulnerabilities of the middle class which took the biggest hit. “With virtually no experience in handling a disaster of this magnitude, the middle and lower middle class sections will find it difficult to overcome the human tragedy,” says S.N. Reghuchandran Nair, president, Trivandrum Chamber of Commerce and Industry. “Unlike the lower income groups which come under the government’s support mechanism or the higher income class which is capable of absorbing the impact, middle class families will find themselves incapable of rebuilding their shattered lives. It is also significant that most of these families inhabit vulnerable areas prone to floods and landslips.”

Traders and owners of Micro Small and Medium Enterprises are also badly affected. “Apart from the damage to assets, it is the loss of livelihood support that is bound to be traumatic for thousands of these people,” says Mr. Nair. He advocates a thorough revamp of the Damage And Loss Assessment mechanism to come up with authentic figures of claim and compensation. Since most traders now file GST returns, that can be taken as the base to work out the losses incurred by them, he says. 


What about crops?

The preliminary estimate of the crop loss is pegged at ₹1,345 crore. More than 3,00,000 farmers suffered damage to various crops spread over 56,439 hectares. The Agriculture Department has proposed an assistance of ₹233.8 crore to compensate farmers. The comprehensive crop insurance scheme is expected to limit the impact of the floods on the farm sector. Officials, however, point out that it will require huge sums to repair agricultural infrastructure like irrigation systems, pumps and bunds. 

More than the damage and loss of infrastructure, it is the impact on livelihoods, incomes and human development that will take time to rebuild, says Mr. Nair. “Any recovery and reconstruction plan will need to factor this in.”

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