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LATEST NEWS UPDATES | Climate change will likely exacerbate Indian rural household's debt burden

Climate change will likely exacerbate Indian rural household's debt burden

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published Published on Jan 3, 2023   modified Modified on Jan 5, 2023

Editorial team, Carbon Copy 

Ongoing shifts in rainfall and temperature caused by climate change are likely to increase the debt burden faced by rural households, particularly of marginalised groups in dry areas, an editorial in Carbon Copy magazine said. The piece cited a study in the journal Climate Change that argues that changes in climate, along with existing socio-economic differences - caste and landholding in particular — will deepen the size and the depth of indebtedness among rural households.

The study highlighted three major pathways through which climatic shifts could be affecting household debt. The first is falling crop productivity and mitigation measures. In arid and semi-arid regions even a 1 degree Celcius increase in temperature can result in a significant decline in crop yields. Additionally, untimely rainfall can engineer crop losses by triggering flash-foods, a common phenomenon in Himachal Pradesh, Uttarakhand and Assam. Such crop losses translate into income losses for households dependent on farming and allied activities. In such cases, debt could become an effective tool to maintain household consumption. Moreover, farmers were likely to invest in pumps, drip-irrigation kits, and sprinkler systems to counter the loss of soil-moisture resulting from high temperatures and drought, and in fertilisers and better seeds to prop up yields. The study found that 54–55 percent of households that increased their area under irrigation also saw an increase in all parameters of indebtedness.

The second pathway was healthcare expenditure. Temperature increases have been associated with a rise in heat-related illnesses and cardiovascular stress. An increase in monsoon temperature can result in water-borne diseases like cholera, typhoid, and diarrhoea, and vector-borne diseases like malaria and chikungunya. Rural households in arid and semi-arid regions tend to have a higher dependence on manual labour, whether as farmers or as daily-wage labourers, who are more susceptible to heat-related illnesses. The results from the study showed that high healthcare costs were a major drain on the finances of rural households

The third pathway was through the exacerbation of existing vulnerabilities. In arid regions, the influence of winter temperature and rainfall anomalies on debt was stronger for Scheduled Tribes (ST) and Other Backward Classes (OBC) households relative to upper-caste households. About 45 percent of ST households depended on agriculture for their livelihoods. At the same time, fewer tribal households (23 percent) had access to irrigation, while a significant proportion (45 percent) depended on wage labour for their livelihoods. Households belonging to marginalised caste groups (ST and OBC) and those who were landless or small-holders were more likely to rely on moneylenders, agricultural commodity traders, and government agencies for access to the means of production needed to sustain household reproduction.

Debt beyond the repayment capacity of households can trap them into a cycle of poverty, which may likely be exacerbated by climate change, the study found. Thus, policies that seek to address the problem of rural indebtedness must consider the role of climate change.  

Please click here to read more. 
Please click here to access the study.


Editorial team, Carbon Copy , 3 January, 2023, https://carboncopy.info/how-climate-change-exacerbates-rural-indias-debt-burden/


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