Saturday, November 10, 2012

India Now Spending More on Adaptation Than Health Care

This is notable -- the national government of India is now spending more on adapting to climate change than they are on health care.

From The Hindu newspaper:
The Union government’s spending on climate change “adaptation” is more than its spending on the health sector, said a top official of the Union Finance Ministry on Monday. Speaking to The Hindu on the sidelines of a national workshop on financing strategies for implementing State-level action plans to counter the effects of climate change, Dipak Dasgupta, Principal Economic Adviser to the ministry, said the Union government spent 2.8 per cent of national Gross Domestic Product (GDP) in 2010-11 on climate adaptation measures, which are intended to reduce the impact of global warming and climate change on various sections of the population.

“We have not included the expenditures on mitigating the effects of climate change,” Mr. Dasgupta pointed out.... Mr. Dasgupta, who also heads the Climate Change Finance unit in the Finance Ministry, said the expenditure on adaptive measures, as a percentage of GDP, has doubled in the last decade. Mr. Dasgupta said more than 10 per cent of the annual budget of the Union government is devoted to such expenditures across all departments.

“The unpredictable nature of the weather, especially in terms of rainfall, is one of the main problems caused by climate change,” Mr. Dasgupta said, referring to the drought this year.
[The "Union government" is India's name for its central government.]

India's 2011 GDP was $1.8 trillion, but $4.5 T on a PPP basis. So their spending on adaptation would be, if it were in the U.S. society, the equivalent of $422 billion, or $1,350 per American.

And this is for 2011, not 2030 or 2050 or 2100. India's per capita GDP (PPP) is only $3,700, so having to spend 2.8% of that on adapting to climate change is a large sacrifice -- and ought to be shameful to the developed world, especially the U.S.

The other day I calculated national contributions to total historical emissions, updating this table by The Guardian (which stops in 2004) using EIA annual national data. Through 2010, the U.S. is responsible for 28% of world emissions from fossil fuel consumption; China 8%, India 3%.

How big is the check we should be sending to India every year?


William M. Connolley said...

The Indian govt spending on healthcare is apparently very low, even by BRICS standards, see for example

However I'm dubious about the spending on "adaption". 10%? Really? I don't find that plausible. I think there is some very creative accounting going on.

The 2.8 figure quoted here may well be a typo for 2.6% ( which in turn appears to come from and I'm not really sure I trust that: they appear to be counting ina whole pile of malaria control, for example.

David Appell said...

10? The official said 2.8%.... Granted, they may have incentive to exaggerate, so as to cast the blame and get compensation, but is 2.8 of GDP really that hard to believe?

Victor Venema said...

I double William in doubting these numbers. If they spend 10% of the government budget on adaptation, they should be spending the entire budget on civil protection.

Only a small fraction of the natural hazards is currently caused by climate change. As we do not know this fraction, it is also nearly impossible to give an estimate which part of the costs are adaptation costs.

In The Netherlands we had good dikes to protect against the sea. Now they are build one meter higher to adapt to climate change. That is a number you could count. However, in many other cases and in a country in which the infrastructure is not yet optimal, estimating the costs of adaptation will be very difficult.

David Appell said...

Victor, William: Where are you guys getting this 10% number? The news story I quoted says India's adaptation costs are 2.8% of GDP....

Victor Venema said...

Your The Hindu article states that this 2.8% of GDP is 10% of the government budget: "Mr. Dasgupta said more than 10 per cent of the annual budget of the Union government is devoted to such expenditures across all departments."

David Appell said...

Oh (duh). Does the 2.8% number seem believable toyou?

(I've written to ask them for more information.)

William M. Connolley said...

Oh, VV read that middle para more carefully than me. I read them as saying "yes, its 2.6%, but if you include mitigation its 10%" - sorry, that was me being careless. They're saying its 2.6% of GDP, but at a % of Govt spending its 10%.

My strong suspicion is that they've reclassified a pile of existing spending under the heading of adaption, either for tax or donor or pol reasons. However, I'll move across to your new post now :-)