Kerala rains: State economy takes a beating amid change in weather pattern

Preliminary industry estimates suggest losses of Rs 200 cr at least over last 4 days; no respite for state as 10 districts put on red alert

The heavy rainfall seen in Kerala over the past four days is set to continue with 10 districts of the state being put on red alert. This has left the people of the state and businesses counting the costs of the shift in rain pattern due to climate change.

This comes in the backdrop of the state accounting for almost 60 per cent of the major landslides in the country in the past seven years.

Though the losses caused in the recent spell of rainfall have yet to be estimated in their entirety, industry body Assocham indicates that the state has seen a loss of around Rs 200-400 crore in the last four days of incessant rain.

According to industry estimates, floods in the last four years have resulted in losses of around Rs 80,000 crore to the state’s economy, killing over 770 people, apart from 150 who are still missing. The floods in 2018, which claimed 483 lives, were the worst in recent years, with the United Nations pegging losses at around Rs 31,000 crore.

Already this year the state had seen deaths of at least 25 persons and 64 heads of cattle, and damages to 1,448 houses between April 1 and July 19. The current spell of rains has claimed more than 12 lives so far in just three days. 

“In the last five years, Kerala has witnessed an increase in extreme weather events. Heavy rainfall caused floods and landslides affected the livelihoods of the locals,” Kerala Chief Minister Pinarayi Vijayan said recently, talking about the impact of climate change on the state.

Based on data available with the Geological Survey of India, out of a total of 3,782 major landslides reported in India in the last seven years, 2,239 were in Kerala.

Also read: Kerala rain: Death toll reaches 13, several districts under red alert

“The last four days have seen a loss of Rs 200-400 crore for the exchequer. We are seeing a long-term impact on the agriculture sector like rubber and tea estates, consumption and manufacturing sectors too,” said Raja Sethunath, chairman, state development council of Assocham.

Impact on economy

According to environmental and industry experts, the state is staring at a huge loss for its agriculture, housing, road network, tourism and consumer durables segments. “The change in rain pattern is due to climate change as global temperature is on a rise. This is leading to the Indian Ocean and the Arabian Sea getting heated up, resulting in intense rainfall in Kerala,” said Sajeev T V, senior principal scientist, Kerala Forest Research Institute (KFRI).

“Traditional monsoon pattern in the state has changed. Last year, there was no gap between the Southwest Monsoon and Northeast Monsoon, it was continuous rainfall. The intensity of summer showers also increased,” Sajeev added.

According to a report by Care Ratings on the 2018 flood, it severely impacted the state’s plantation industry. The rains in Kerala, which produces 85 per cent of India’s natural rubber, have had an impact both on the production and supply sides and in turn on tyre prices as well. 

The state also supplies 20 per cent of the country’s total coffee production and 85 per cent of small cardamom. Other major crops include coconut, tea, pepper, cashew, arecanut, nutmeg, ginger, cinnamon, and cloves. “Heavy rains and its change in rain pattern has affected the production of some of these crops. Some crops like even rubber have started facing pest attacks,” Sajeev said. 

The damage to roads and housing are similarly worrying. According to data shared by the ministry of water resources, between 2018 and 2020 alone, around 355,000 houses were damaged by floods in Kerala, while the loss to public utilities in financial terms are pegged much higher.

As heavy rains have recently coincided with the festive season – that kicks off with Onam in districts like Ernakulam, Idukki, Kollam, Kottayam and Pathanamthitta that see majority of foreign and domestic tourist inflow – the tourism too is feeling the pinch. The state used to see around 1.09 million foreign and 15 million domestic tourist visits before 2018, this has come down drastically in the last two years. In large part due to Covid-19, the state saw a dip of over 90 per cent in international tourists in 2021, as against 2020, according to media reports.

According to the Care Ratings, the Onam season contributes 50-60 per cent of the total consumer durable sales in Kerala and also a large share of gold sales. For the last five years, rain has also dampened the spirit of festive markets in the state. With rivers overflowing and shutters of dams getting opened, this year, too, initial sales in the season have already taken a hit.