Several Indian states among top 50 regions facing climate risk
According to a ranking by the Cross Dependency Initiative (XDI), 80% of 50 provinces that are at the highest climate risk to their physical infrastructure by 2050 are in India, China, and the United States of America (US). The ranking was made public on Monday in a report titled 'Gross Domestic Climate Risk'. Some of the most at-risk states are Maharashtra, Punjab, and Kerala.
Mumbai is at high risk
As per analysis, the vast majority (80%) of the top 50 most at-risk states and provinces in 2050 are in three countries. The most vulnerable states in India, according to the ranking, are Punjab, Bihar, Uttar Pradesh, Maharashtra, Rajasthan, Tamil Nadu, Gujarat, Kerala, and Assam. The ranking highlights that India's commercial capital, Mumbai is at high risk.
Which other regions in the world are at risk?
The most affected provinces in China, whose states top the ranking, are mainly found in the east and south, near the floodplains and deltas of the Yangtze and Pearl Rivers. The most affected states in the US are California, Texas, and Florida because of their importance to the economy. Other countries with multiple regions in the top 50 include Brazil, Pakistan, and Indonesia.
Findings significant for investors
The ranking data can be significant for investors, as extensive built-up areas overlap with high levels of economic activity and property wealth. It can inform climate-resilient investment, in conjunction with adaptation measures and infrastructure planning undertaken by state and provincial governments, a statement by XDI said. Jiangsu and Shandong are the two most at-risk largest economic hubs in China, as per the report.
Pricing physical climate risk is important
"We are releasing this analysis in response to demand from investors for data on sub-sovereign and regional risk," said XDI CEO Rohan Hamden in a statement on Monday. He also said that the findings from the XDI Gross Domestic Climate Risk ranking underscore the importance of pricing physical climate risk in financial markets, including the bond markets.
The ranking reflects the physical risk to the built infrastructure
The Gross Domestic Climate Risk ranking reflects the physical risk to the built infrastructure from eight climate change hazards: riverine and surface flooding, coastal inundation (coastal flooding), extreme heat, forest fire, soil movement (drought-related), extreme wind, and freeze-thaw. The analysis uses global climate models, combined with local weather and environmental data and engineering archetypes, to calculate probable damage to the built environment.
