Climate Change

Indian economy will be hit hard by rising heat: Global report

By 2030, the average loss in daylight working hours could put between 2.5% and 4.5% of the GDP at risk annually

By Pushp Bajaj
Published: Tuesday 11 February 2020
Photo: Nasa

Extreme heat will significantly lower the outdoor working capacity of India’s labour workforce in the next three decades, putting at risk, the country’s economic growth, a recent report by the McKinsey Global Institute has warned.

In India, nearly 75 per cent of the labour force (some 380 million people) is exposed to heat- related stress. By 2030, the average loss in daylight working hours could put between 2.5 and 4.5 per cent of the Gross Domestic Product (GDP) at risk annually, the report said. 

The McKinsey report analyses the physical risks and socio-economic impacts of climate change across the world in the next three decades under a business-as-usual scenario.

It outlines the dramatic socio-economic impacts that will follow through nine test cases of regions that are most vulnerable and a separate global assessment.

Without major adaptation and mitigation measures, large parts of India (a test case for the study) will become too hot to survive and / or work outdoors in, according to the report. 

Rising heat and humidity levels will expose between 160 million and 200 million Indians to a higher risk of lethal heat waves by 2030. Lethal heat waves, in this case, were defined as a three-day (or more) heat wave with ‘wet bulb temperature’ of 34 degrees Celsius (35°C, after considering the urban heat island effect).

The wet bulb temperature takes into account both heat and humidity. Simply put, at 100 per cent relative humidity, wet bulb temperature is equal to the air temperature, and at lower humidity, it is lower. 

The human body loses its natural ability to sweat and cool down at temperatures above 35°C at 100 per cent humidity. At a wet bulb temperature of 35 °C or higher, we can survive outdoors for at most a couple of hours. 

Globally, 700 million-1.2 billion people will be living in areas with a non-zero chance of lethal heat waves by 2050, according to the report. 

High temperatures and sustained heat waves will hamper outdoor working ability of the labour force. Estimates suggest that the number of working hours lost due to extreme heat would increase from 10 per cent today to 15-20 per cent by 2050, severely affecting economic growth. 

The report further emphasizes what numerous studies have shown in the past — poorer countries with lower per capita GDP in the developing world are closer to physical thresholds. They are the most vulnerable and will be hit the worst with the economic shocks of climate change in coming decades.

Other impacts

A vast majority (~90 per cent) of the excess heat due to global warming is actually stored in the oceans which will also have far reaching socio-economic impacts.

According to the report, reduced fish populations due to rising ocean temperatures will affect the livelihoods of around 650-800 million people in the fisheries industry. 

On the other hand, climate change may provide an economic boost, to some extent, to colder, richer countries. Tourism in areas of northern Europe and agriculture in Canada, for example, may see some benefits of rising temperatures. 

The authors warn of non-linear impacts once crucial thresholds are crossed. In addition to the extreme heat-related impacts mentioned above, potential socio-economic ‘tipping points’ could be crossed in terms of damage to infrastructure due to flooding and losses in agricultural yields. 

For instance, Ho Chi Minh City in Vietnam, is prone to monsoonal and storm surge flooding. Direct damage to infrastructure from a 100-year flood could rise to $1 billion by 2050, without adaptation.

As the study points out, in a central economic hub like Ho Chi Minh City, damages to infrastructure such as power lines, data centres, transportation services, etc could have serious indirect, long-term effects as well.  

Food production is another example of systems prone to tipping point like responses. Agricultural practices around the world have been designed and optimised to specific weather and climate conditions. Any change from normal puts production under high risk. 

Nearly 60 per cent of global grain production is localized in only five so-called ‘breadbasket’ areas. With rising extreme weather events due to climate change, any damage to the breadbasket areas will have significant impact on global food security. 

The report urged governments and business leaders to “put in place the right tools, analytics, processes, and governance to properly address climate risk, adapt to risk that is locked in, and decarbonize to reduce further build-up of risk.”

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