Economic Impacts of Natural Disasters

ECONOMIC IMPACTS OF NATURAL DISASTERS ABSTRACT haps of both natural and technological origin hold a considerable clash on communities. The personal effects of accidents in India atomic number 18 signifi rafttly reduced by well established counter disaster ar orbitments at all triplet levels of government. These arrangements comprise comprehensive plans of pr up to nowtion, prepargondness, response and bumpy and in more late(a) times, of mitigation. The sparing effects of disasters stub be waste and widespread.When disasters strike houses, tradees and familiarity bag brace damaged or washed-up and peoples livelihoods argon temporarily and aroundtimes permanently disrupted. Physical damage is the almost visible sparing pretend of disasters. Major natural disasters rouse and do have severe negative short-run economic impacts. Disasters in addition emerge to have adverse longer-term consequences for economic growth, development and poverty reduction. But, negativ e impacts are non inevitable. Vulnerability is shifting quickly, especially in countries experiencing economic duty period rapid growth, urbanization and related technical and social changes.In the Caribbean and Bangladesh there is tell ap invention of both declining sensitivity to tropical storms and floods and increased resilience resulting from both economic transformation and national actions for disaster reduction. The largest concentration of high risk countries, more and more vulnerable to climatic hazards, is in Sub-Saharan Africa. Risks emanating from geophysical hazards need to be better recognized in highly exposed urban areas crosswise the world because their potential be are rising exponentially with economic development.Natural disasters cause square budgetary pressures, with both narrowly fiscal short-run impacts and wider long-term development implications. Reallocation is the primary fiscal response to disaster. Disasters have little impact on trends in tot al aid flows. Keywords Disaster Impacts, moderate Economic Impacts, validating Economic Impacts, Intangible Economic Impacts. Submitted by Dr. A. PADMAVATHI, Guest Faculty, Department of MCA, S. V. U. C. C. M&C. S. , S. V. University, Tirupati-517502. Introduction The economic effects of disasters are mostly seen as physical damage to infrastructure.More frequently than non prejudice of income through with(predicate) and through loss of trading activity and the time taken to re-establish such(prenominal) activity, particularly for agricultural industries, is overlooked. The consequences of extended periods of trading or production down-time can result in bankruptcy, forced sale, pedigree closure, loss of experienced workers, a depleted customer base and population shrinkage. These consequences are exacerbated by connection losses resulting in a reduction in disposable income. The flow-on through the disaster affected community has been likened to the domino effect.It address es the economic consequences of disasters on communities and includes a example of economic recovery principles as well as strategies to implement those principles. In this publication the term economic is used with take to be to the be to the community caused by the disaster while financial is used with respect to those schemes aimed at providing monetary sources to assist recovery. The range of economic effects and consequences on a disaster affected community is relative to the specific nature of the event and the economic demographics of the affected community Economic Consequences of DisastersThe economic effects of disasters can be devastating and widespread. When disasters strike houses, tradinges and community infrastructure get damaged or destroyed and peoples livelihoods are temporarily and roughlytimes permanently disrupted. Physical damage is the most visible economic impact of disasters. However, the less visible impacts such as lost income through being unable to trade are just as significant and the consequences oft last longer than the physical damage (for example, bankruptcy and business closures). The flow-on effects through a community can be pervasive.The range of economic effects and consequences for a disaster-affected community vary greatly and forecast on both the nature of the event and the economic health of the community. It is as well important to recognise that communities are diverse. In some cases, disaster-affected communities recover and prosper, in others the adverse economic impact has a domino effect that spreads end-to-end the community. What makes some communities recover and prosper and others decline in the aftermath of a disaster? What are key characteristics of disaster-resistant communities?These are important questions and are faultfinding to understanding the economic recovery process. The principles and strategies identified later in this melodic theme provide a starting point for considering these qu estions. The economic consequences of disasters can be classified in a variety of ways. No single framework will cover and prescribe every possible impact a disaster might have. Each disaster has unique characteristics and consequently in any attempt to classify these impacts there will always be impacts that do not fit neatly within the variety.Nevertheless a classification framework is a useful guide or tool we can use to tackle these issues. Almost all impacts of disasters have an economic dimension, even if this economic effect cannot be measured. Economic impacts are typically divide into two categories tangible (those impacts we can assign a dollar evaluate to) and intangible (impacts which are not easily expressed in monetary terms). These impacts are then further subdivided into direct and indirect impacts. Direct impacts are those that result from the physical destruction or damage to buildings, infrastructure, vehicles and crops etc.Indirect impacts are referable to th e consequences of the damage or destruction. Figure 1 illustrates the impacts of disasters using three briny categories-direct, indirect and intangible. An alternative approach is to examine the impacts of disasters in terms of who or what is affected. Three groupings are uncouth * cosmos infrastructure and community facilities * disdain enterprises (commercial, industrial, retail, service, agricultural etc) and * Residents and households. Using figure 1 and BTE Report 103 a drawing discussion of the direct, indirect and intangible impacts of disasters on each of these three groups follows.FIGURE 1 THE ECONOMIC IMPACT OF A DISASTER Culture & Heritage foot up Infrastracture Intangible impacts Health Aspects Death & fault I Indirect Impacts Business fray Disaster Impacts Direct Impacts Agriculture Commercial buildings 1. Direct Economic Impacts general Infrastructure and Community Facilities Lifelines (such as water and sanitisation systems, electricity, gas, telecommunicatio ns and transport) are vulnerable to all types of disasters. Direct damage to lifeline infrastructure includes the immediate physical damage (eg. oads cracked or washed away, destroyed electrical transformers and so on) and also the damage which may take some time before becoming visible (eg. accelerated road declension due to the effect of water intrusion under road pavements). Public buildings include schools, child care centres, kindergartens, hospitals, nursing homes, neighbourhood centres, churches, entertainment/art/cultural centres, museums, clubs and so on. Direct damage to public buildings can also be thought of using the break up into structural (eg. roofs, walls etc), content (eg. urniture, coldcock coverings and specialist items like sound systems and paintings etc) and external (eg. Playground equipment, naiant pools etc) damage. Business Enterprises include commercial, industrial, retail, service and agricultural business types. The economic impact of disasters on a gricultural enterprises is often treated separately from other business types. Essentially however the impact on businesses can be viewed as falling into 3 main areas. * structural damage to buildings such as shops,factories, plants, sheds, barns, warehouses, hotels and so on.This includes damage to foundations, walls, floors, roofs, doors, in-builtfurniture, windows etc. * contents damage to fixtures and fittings (eg. carpets), furniture, office equipment, set up equipment, records, product stock (finished manufactured products, works in progress and input signal materials), crops, pastures, livestock etc. and * external damage, for example, to motor vehicles and fences. Residents and Households The residential sector includes houses, flats, unit, townhouses and so on. The break up of direct damage into structural (eg. roofs, walls etc), contents (eg. furniture, floor coverings etc) and external (eg. wimming pools, gardens etc) is equally useful for this category. 2. Indirect Eco nomic Impacts Indirect impacts are those that are incurred as a consequence of the event, but are not due to the direct impact. Many indirect impacts are common to the public/community sectors business, and household (for example, perturbation and clean up). Disruption effects The disruption to the community, businesses and households caused by disasters is pervasive. The economic impact of disruption and its consequences for community recovery is often overlooked, as economic recovery can tend to focus on the highly visible direct physical damage.The following categories list the common forms of disruption relevant to each area. Sector/Area of impact Disruption Examples Business Lost or deferred production (eg. manufacturing, agriculture, services etc)Lost or deferred income/trade/sales/value added (eg. Tourism operators, retail traders etc)Increased cost (eg. freight, inputs, agistment) Public services and networks Transport (traffic delays, extra operating cost etc) difference o f computer controlled systems pass of other lifelines (eg. electricity) disposal services (eg. ducation) Households Additional costs (eg. alternative accommodation and transport, heating, drying out costs, medical costs etc) Natural disasters can cause serious disruption to affected businesses which may not be able to operate during the event, and for some time afterwards, while the premises are being cleaned and equipment repaired. Business lost during this period can have devastating financial consequences and in some cases the business may not recover at all. Loss of farm income due to a natural disaster can affect the economies of country towns.For example, the Australian Bureau of Agriculture and pick Economics (ABARE 2000) estimates that farm expenditure represents at least a ternary of the economies of towns with less than 1000 people. Disasters that reduce farm expenditure can and then have a major effect on the economies of small towns. disrobe up Cleaning up after a di saster is another(prenominal) obvious area of indirect impact. The impact for public and community infrastructure, businesses and households is basically the time it takes and the costs of cleaning materials.Clean up activities typically include removal of mud and debris, disassembly and cleaning of machinery and equipment, removal of destroyed household and business contents items and so on. 3. Intangible Economic Impacts Intangible impacts are often described as a catch all that includes all those costs that are very difficult to estimate, for which there is no agreed rule of estimation and for which there is no market to provide a benchmark. order suggests that the size of intangible costs is substantial and although most cannot be quantified, in many cases they do still have an economic impact that should not be ignored.Sector/Area of impact Intangible impact examples Business Loss of confidenceLoss of future contractsLoss of experienced staff Public/Community Health impacts (deferral of procedures, reduced quality of care etc)Death and injuryLoss of items of cultural significanceEnvironmental impactsHeritage losses insufficiency of access to education, health, defence, art galleries and museums etc Residents and households Loss of personal memorabiliaInconvenience and disruption, especially to development and social life. Stress induced ill-health and mortalityPetsQuality of life kerfuffle ConclusionAssistance that ensures the survival of the existing economic infrastructure of a region is vital to disaster recovery, but it should not be so great as to affect the natural economic laws of supply and use up operating on the sales and distribution of existing products or services. Government can initiate major projects, that can assist in erasing some of the bad memories of the past and provide a boost in wind and service jobs into the area. References (1) http//en. wikipedia. org. (2) www. ndmindia. nic. in/ (3) www. ndma. gov. in/ (4) disastermgmt. bih. nic. in/ (5) http//saarc-sdmc. nic. in/index. asp