A man turns on a water pump at a farm in the district of Palwal in India's Haryana state on January 12, 2018. Anindito Mukherjee / Bloomberg
A man turns on a water pump at a farm in the district of Palwal in India's Haryana state on January 12, 2018. Anindito Mukherjee / Bloomberg

India food crisis likely if climate change continues: report



India’s farmers are already feeling the effects of climate change, and agricultural output will suffer further as rainfall becomes more and more erratic, a government report has predicted.

The annual economic survey, published by India’s finance ministry on Monday, said changes in climate could shrink agricultural income by as much as 25 per cent in unirrigated farmland and 18 per cent in irrigated areas within the next 82 years.

But even these figures might underestimate the true impact of climate change, said the survey, which was overseen by prime minister Narendra Modi’s chief economic adviser, Arvind Subramanian.

"These are stark findings, given the already low levels of incomes in agriculture in India," it added.

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Farming was once the backbone of the Indian economy, contributing 52 per cent of India’s GDP in 1950.

Although that share has dropped steadily over the years, down to around 14 per cent today, a huge proportion of the population still depends on agriculture for its livelihood.

According to data from India's 2011 census, roughly 263 million Indians — around 22 per cent of the population — work in the sector, either as farmers or as agricultural labourers.

Among them is Aruna Urs, whose family has been farming land near the city of Mysore, in the state of Karnataka, for at least eight generations. In the summer, Mr Urs grows vegetables; after the monsoon has passed, in the final third of the year, he grows quinoa and chia.

Over the past decade, Mr Urs has been noticing spiking temperatures every April — the time when he would usually be starting to plant his tomatoes. "The peak temperature seems to have gone up by at least 2°C," he said. "Now 40°C has now become the norm."

As a consequence, the tomatoes suffer. Mr Urs now transplants his plants from the nursery to the field at night, when it’s cooler. Even so, half the plants die within a day. "The mortality rate [even five years ago] was just 10 or maybe 20 per cent."

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Summer temperatures are expected to rise further across the Indian subcontinent. If worldwide emissions do not decline, several parts of northern India will reach a fatal "wet-bulb" temperature of 35°C by the end of this century, according to research published by Massachusetts Institute of Technology scientists in August last year.

A so-called "wet-bulb" temperature factors humidity as well as heat into its calculations. At a wet-bulb temperature of 35°C, humans are unable to cool themselves through perspiration.

The shifting climate has also made rainfall over India more irregular. And in a country where roughly 52 per cent of the farmland is unirrigated — in other words, dependent on seasonal rain to water its crops — this is a big problem.

In times of heavy rain, crops are inundated or washed away; when rain is scarce, farmers resort to pumping more water out of the earth to water their crops, depleting groundwater resources as a result.

With this in mind, the economic survey said that India must irrigate more of its farmland.

"The challenge is that the spread of irrigation will have to occur against a backdrop of extreme groundwater depletion, especially in North India," the survey said. Irrigation relies, in part, on conserving and carefully distributing groundwater.

"India pumps more than twice as much groundwater as China or the United States," it added.

But many of India’s farmers are among the country's poorest people, unable to afford the installation of irrigation systems. The average farm household earns 6,426 rupees (Dh371) a month, according to government data.

"Labour is expensive. Machinery is expensive," said Jasjit Kang, an agronomist at Punjab Agricultural University. "Farmers just can’t afford these kinds of costly additions to their farms."

The unpredictable rainfall also brings another challenge: disease, wrought by bacteria, viruses and insects. Last year, for instance, unusually heavy spells of rain in Karnataka triggered an outbreak of armyworm, an insect that feeds on paddy, maize and millets. Nearly half a million acres of crops were destroyed, the state’s agriculture minister said in December last year.

"People near me grow millet, and I saw them spraying insecticide on their crops, because the infestation was so massive," Mr Urs said. "I’ve never seen people do that before. This was the first time they needed to do it."

As climate change further disturbs agricultural patterns, farmers will go into deeper distress. Since 1995, when the government started to keep relevant records, roughly 300,000 Indian farmers have committed suicide, unable to pay off their debts or improve their harvests.

A study published last year by a researcher at the University of California, Berkeley, found a correlation between farmer suicides and spikes in temperature in India.

"For temperatures above 20°C, a 1°C increase in a single day’s temperature causes [roughly] 70 suicides, on average," the researcher, Tamma Carleton, said, estimating that at least 59,000 suicides since 1980 can be attributed to a warming climate.

If agricultural families aren’t able to adapt to building temperatures, she added, “it’s likely we will see a rising number of lives lost to suicide as climate change worsens in India”.

But it won’t just be farmers who suffer, said Mr Urs.

“When plants suffer heat stress, they don’t yield. So the produce coming to the markets is much less, and the prices are much higher,” he said. “This is a bad thing for every single person who eats any food at all in India.”

The rules on fostering in the UAE

A foster couple or family must:

  • be Muslim, Emirati and be residing in the UAE
  • not be younger than 25 years old
  • not have been convicted of offences or crimes involving moral turpitude
  • be free of infectious diseases or psychological and mental disorders
  • have the ability to support its members and the foster child financially
  • undertake to treat and raise the child in a proper manner and take care of his or her health and well-being
  • A single, divorced or widowed Muslim Emirati female, residing in the UAE may apply to foster a child if she is at least 30 years old and able to support the child financially
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Day 2, Dubai Test: At a glance

Moment of the day Pakistan’s effort in the field had hints of shambles about it. The wheels were officially off when Wahab Riaz lost his run up and aborted the delivery four times in a row. He re-measured his run, jogged in for two practice goes. Then, when he was finally ready to go, he bailed out again. It was a total cringefest.

Stat of the day – 139.5 Yasir Shah has bowled 139.5 overs in three innings so far in this Test series. Judged by his returns, the workload has not withered him. He has 14 wickets so far, and became history’s first spinner to take five-wickets in an innings in five consecutive Tests. Not bad for someone whose fitness was in question before the series.

The verdict Stranger things have happened, but it is going to take something extraordinary for Pakistan to keep their undefeated record in Test series in the UAE in tact from this position. At least Shan Masood and Sami Aslam have made a positive start to the salvage effort.

Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

COMPANY PROFILE
Name: Kumulus Water
 
Started: 2021
 
Founders: Iheb Triki and Mohamed Ali Abid
 
Based: Tunisia 
 
Sector: Water technology 
 
Number of staff: 22 
 
Investment raised: $4 million 
City's slump

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Profile of Tarabut Gateway

Founder: Abdulla Almoayed

Based: UAE

Founded: 2017

Number of employees: 35

Sector: FinTech

Raised: $13 million

Backers: Berlin-based venture capital company Target Global, Kingsway, CE Ventures, Entrée Capital, Zamil Investment Group, Global Ventures, Almoayed Technologies and Mad’a Investment.