World Bank sanctions $125 million loan to Kerala to support its preparedness against natural disasters and climate change impacts

Published : July 20, 2021 15:25 IST

Flood affected areas of Chengannur in Alappuzha district in August 2018. Photo: PTI

The World Bank has signed a $125 million loan agreement with the Government of India and the Government of Kerala to help support Kerala’s new initiatives for preparedness against natural disasters, climate change impacts, disease outbreaks and pandemics.

The State government had identified the need to go beyond traditional approaches to recovery and reconstruction following the devastating floods of 2018 and had been devising programmes not only to recover fully from the effects of the floods but also to build resilience against future disasters.

It also launched an institutional mechanism—the Rebuild Kerala Initiative (RKI)—to drive the State towards resilience and risk-informed disaster preparedness.

The $125 million loan was approved by the World Bank’s Board of Executive Directors in Washington on June 25 and was signed by representatives of the bank and the governments of India and Kerala in New Delhi on July 19. The loan, from the International Bank for Reconstruction and Development (IBRD), has a final maturity of 14 years including a grace period of six years.

A press statement issued by the bank said that its support will help the State focus on two key areas: one, to incorporate disaster risk planning in the master plans of urban and local self-governments to ease financial constraints on the State government when dealing with unexpected shocks; and two, to help make the health, water resources management, agriculture, and road sectors more resilient to calamities.

The programme is part of a series of World Bank-financed operations in Kerala and laid the foundations for a five-year State Partnership Framework. The First Resilient Kerala Development Policy Operation (DPO), approved by the bank in June 2019, undertook several initiatives.

Elif Ayhan, Senior Disaster Risk Management Specialist and one of World Bank’s Task Team Leaders for the programme, had said in a press statement soon after the project was approved last month: “The groundwork laid during the first programme improved the government’s capacity to assess and respond to disasters. The new programme aims to enhance the State’s capacity to deal with potential shocks by mainstreaming climate and disaster risks into planning and investment processes.”.

The floods of 2018, the worst Kerala had seen in nearly a century, impacted more than five million people, mainly in the Pamba river basin areas in central Kerala.

An initial demonstration project of the State-wide programme is to be executed in the Pamba basin, including areas in Idukki, Kottayam, Pathanamthitta and Alappuzha districts “forming a microcosm of the State, with tropical monsoon forests, dense urban settlements, and the rice bowl of Kerala in its lowlands”. The World Bank expects the “multisectoral approach” to be tested here to have a “demonstration effect” for the entire State.

Junaid Ahmad, World Bank Country Director in India, said the bank is investing in Kerala’s capabilities to respond to shocks to the state economy and, importantly, prevent as much as possible the loss of lives, assets, and livelihoods. “The objective is not to finance schemes but partner with the Government of Kerala to improve the State’s financial health; invest in sectors like health, water resources, social protection and agriculture; and address the drivers of natural disasters, climate change, and pandemic risks,” he said.

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