Natural disasters such as floods, landslides and earthquakes are becoming increasingly common. Alongside, the call for more funds to deal with these disasters from State governments is also vociferous. But in an answer to a question in Lok Sabha, Nityanand Rai, Minister of State in the Ministry of Home Affairs, revealed that States sought approximately ₹1.5 lakh crore from the Central government between 2019 and 2024, but the Centre released only ₹29,263 crore under the National Disaster Response Fund (NDRF). The high-level committee had approved ₹36,397 crore for natural disaster relief in this period.

The funds released are lower because financial assistance from the Central government is provided through two mechanisms: the State Disaster Response Fund (SDRF) and the NDRF. Under the SDRF, the Centre provides 75 per cent of the amount for general-category States and 90 per cent for northeastern States and Himalayan States. In contrast, the NDRF is fully funded by the Central government to assist States in disaster management.

Between 2020 and 2025, approximately ₹83,118 crore has been released to States under the SDRF. Maharashtra, Uttar Pradesh and Madhya Pradesh have received the highest allocations, with ₹12,978 crore, ₹7,704 crore and ₹6,489 crore, respectively.

Release of funds

While deciding on the release of funds under NDRF, 50 per cent of the outstanding balance under SDRF is adjusted. In other words, the Centre expects States to utilise the funds in SDRF and then ask for releases from the NDRF.

In an interview with businessline, Finance Minister Nirmala Sitaraman had said, “Just take all the States and see how much of SDRF and NDRF money has been released and how much they have spent. Secondly, how much of SDRF and NDRF money goes for disaster relief is again a formula given by the Finance Commission. The Central government cannot tweak it in favour or against any State.”

In 2019-20, States requested ₹47,284 crore, but ₹12,862 crore (27.2 per cent) was disbursed under NDRF. In 2021-22, States sought ₹25,338 crore, and the Centre released ₹5,464 crore (21.6 per cent). Similarly, in 2023-24, States demanded ₹8,673 crore, but only ₹1,114 crore (12.8 per cent) was provided.

From 2019 to 2024, Karnataka, West Bengal and Maharashtra received the highest amounts at ₹5,125 crore, ₹4,860 crore and ₹4,769 crore, respectively, in financial assistance from the NDRF. These States reported six, four and seven natural calamities during the period.

Tamil Nadu, Andhra Pradesh and Assam recorded the highest number of calamities, with six, five and five events, respectively. The NDRF allocations were, however, lower for these States, with Tamil Nadu receiving ₹1,535 crore, Andhra Pradesh - ₹1,565 crore, and Assam - ₹1,699 crore.

Significant gap

The 2019 Standing Committee Report on ‘Central Assistance for Disaster Management and Relief’ highlighted a significant gap between the funds requested by State governments and the amount released by the Central government. It recommended an annual increase in the total corpus of the SDRF for the period 2020-25. It proposed a provision for the automatic release of advance funds from the NDRF in cases of disasters of rare severity to facilitate immediate relief efforts.

Abinash Mohanty, Global Sector Head of Climate Change & Sustainability at IPE Global, said, “The quantum of funds disbursed to States for calamities is determined on a priority basis on a reactive approach, as States often lack immediate and accurate information on hazard, risk and vulnerability on the losses incurred and may happen. Additionally, every State has its own contingency fund that can be utilised for relief and rehabilitation work; however, in most cases, these funds remain underutilised due lack of hyper granular assessments and capacity gaps.”

Mahesh Sharma, who teaches at the Department of Civil Engineering, Himachal Pradesh University-UIT, Shimla, pointed out, “The Central government conducts thorough scrutiny of an event post-disaster needs assessment before releasing funds to States. Also, various state departments, such as the Public Works Department, provide financial assistance, too.”

Sharma explained there is a need for a better system in place apart from financial assistance to States. “In addition to financial assistance, there is a significant lack of comprehensive ground-level data in the current system. Critical information, such as the degree of rainfall, types of disasters, triggering factors, and loss of lives, is often missing. Collecting and analysing such data could help devise more effective and tailored solutions,” Sharma added.

Published on December 4, 2024