An autonomous research institute under the Ministry of Finance


Workshop on Risk Governance and Investing in Resilience, 27th October, 2016

Delhi hosted the 7th Asian Ministerial Conference on Disaster Risk Reduction on 2-5 November, 2016. Several curtain raiser events were organised in anticipation of this conference and NIPFP, in collaboration with the National Disaster Management Authority (NDMA), organised a workshop on Risk Governance and Investing in Resilience on 27th October 2016. The report of the workshop, which highlights the themes that emerged from discussions, can be found here.


Mainstreaming Disaster Risk Reduction
There has been increasing recognition over the last two decades that the problem of disaster risk is endogenous to the process of development. When natural hazards strike exposed and vulnerable populations, capital assets and economic activity, disaster losses occur. Development processes that increase the exposure and vulnerability to natural hazards, often unwittingly, increase disaster risk. The only way to achieve sustainable disaster risk reduction is to ‘mainstream’ disaster risk reduction into development, and link it to other development priorities and securing a risk-aware ethos. 
Ten Years of Implementation of the Disaster Management Act
The Disaster Management Act of 2005 provided a legal framework for a multi-tiered system of disaster risk management in the country. It established national, state and district level disaster management authorities, and assigned them a wide range of responsibilities. However, there is a lot of variation in these authorities across different states in the country. Depending on their own disaster risk context, needs, administrative culture, and capacities, states have established different kinds of institutional arrangements. Ten years after the implementation of the Act, it is an opportune time to take stock and foster experience sharing and mutual learning among states. 
Risk Financing
Finance and disaster management are interlinked. Building resilience comes at a cost, but public finances are also impacted in the context of a large-scale disaster. As a result, neither finance nor disaster management can be fully addressed independently of each other. Addressing both disaster management and finance requires designing appropriate risk-return matrices, for which liquid well-functioning financial markets are required. For example, construction-related risk financing requires a well-functioning bond market.
Financing Disaster Risk Reduction, Response and Recovery
Currently, immediate disaster response is funded through state and national Disaster Response Funds. Disbursements from these funds follow norms laid out by the Government of India, which  specify the type of disasters and activities that can be supported from the funds. Although long-term recovery and reconstruction is not covered, there is provision for cash assistance for fully damaged or destroyed houses. After major disaster events, reconstruction and recovery have often been funded through external financing. Although the Disaster Management Act calls for the establishment of a mitigation fund, there is no separate funding window for disaster risk reduction efforts yet. 
Regulating the Built Environment
India’s built environment is changing rapidly. There is a higher rate of growth in hazard prone areas leading to increasing exposure to natural hazards, and an increasing proportion of the capital stock that is more vulnerable to damage from natural hazards. With careful regulation of the built environment, these trends can not only be arrested but also reversed. Regulating the built environment requires: 1) appropriate norms, building codes, building bye-laws etc.; 2) institutional mechanisms at the local level to enforce those norms; and 3) capacities both in the government as well as in the private sector. There is also a gap in regulating professions – such as engineers, architects, urban planners, builders, public health and environmental engineering professionals, that are involved in shaping the built environment of the future.