Context:
The 16th Finance Commission’s disaster funding formula has raised concerns for penalizing disaster-prone states like Odisha due to its reliance on population-based exposure metrics.
Key Highlights:
Policy & Allocation Details
- Total allocation to State Disaster Response Funds (SDRF): ₹2,04,401 crore.
- Increase of 59.5% compared to previous cycle.
- Odisha’s share reduced by 1.57 percentage points.
Conceptual Framework
- Formula based on Disaster Risk Index (DRI):
- Hazard
- Exposure
- Vulnerability
- Exposure metric: Based on total population, scaled between 1–25.
Issues & Concerns
- Population-based exposure ignores actual hazard-prone zones.
- Vulnerability measured via per capita NSDP is inadequate.
- Fails to reflect:
- Housing resilience
- Health infrastructure
- Early warning systems
States Affected
- Highly disaster-prone states:
- Odisha
- Andhra Pradesh
- Kerala
- Assam
Significance
- Misallocation may weaken disaster preparedness.
- Climate change is increasing frequency and intensity of disasters.
- Raises concerns about equity in fiscal federalism.
Relevant Prelims Points:
- Finance Commission (Article 280)
- Constitutional body recommending distribution of finances between Centre and States.
- State Disaster Response Fund (SDRF)
- Primary fund for state-level disaster management.
- Disaster Risk Index (DRI)
- Combines Hazard, Exposure, Vulnerability.
- Exposure
- Refers to people/assets in hazard-prone areas.
- NSDP (Net State Domestic Product)
- Indicator of state economic performance.
Relevant Mains Points:
- Issues in Fiscal Federalism
- Allocation formula may disadvantage vulnerable states.
- Highlights need for context-sensitive resource distribution.
- Disaster Management Challenges
- Need for localized risk assessment instead of broad metrics.
- Importance of data-driven governance.
- Climate Change Dimension
- Increasing disasters demand adaptive policy frameworks.
- Coastal and flood-prone states face disproportionate risks.
- Governance & Institutional Reform
- Role of NDMA in developing better indices.
- Need for transparent and scientific methodologies.
Way Forward
- Revise exposure metric to include population in hazard zones only.
- Develop composite vulnerability index.
- NDMA should publish an annual Disaster Vulnerability Index.
- Incorporate climate projections into funding formula.
- Strengthen early warning and resilience infrastructure.
UPSC Relevance:
- GS Paper 3: Disaster Management, Climate Change
- GS Paper 2: Governance, Federalism
- Essay: Climate resilience, equitable development