India’s disaster response, a slippery slope for federalism

Source: The post “India’s disaster response, a slippery slope for federalism ” has been created, based on “India’s disaster response, a slippery slope for federalism ” published in “The Hindu” on 29th November 2025.

UPSC Syllabus: GS Paper-3- Disaster and Disaster Management

Context: India’s disaster-response financing system, created under the Disaster Management Act, 2005, was intended to strengthen cooperative federalism, but recent trends indicate a shift toward a more centralised and conditional model. The widening gap between States’ assessed needs and the Union’s actual disbursements, as seen during the 2024 Wayanad landslides, highlights the growing strain on fiscal federalism.

Key Issues in India’s Disaster Financing Framework

1. India operates a two-tier disaster financing mechanism consisting of the State Disaster Response Fund (SDRF) and the National Disaster Response Fund (NDRF), but the system has increasingly drifted toward central control.
2. For example: The Union government approved only ₹260 crore for Kerala against its estimated loss of ₹2,200 crore during the Wayanad tragedy, reflecting a deepening imbalance between requirements and allocations.
3. The structural design appears balanced, but in practice, the funding process is dominated by Union discretion and lengthy approval stages.

Major Challenges in Disaster Response and Federalism

1. Outdated and Rigid Relief Norms: Relief norms have not kept pace with inflation or reconstruction needs, as compensation ceilings such as ₹4 lakh for each life lost and ₹1.2 lakh for a fully damaged home have barely changed in a decade.
2. Ambiguity in Classification of Severe Disasters: The Disaster Management Act does not clearly define what constitutes a “severe” disaster, giving the Union wide latitude in deciding which events qualify for NDRF assistance.
3. Procedural Delays in Fund Release: Disaster assistance is not automatically triggered and depends on several steps including State memoranda, central assessment, and high-level approvals, causing delays when immediate support is most critical.
4. Weaknesses in Allocation Criteria: The Finance Commission uses population and geographical area to determine allocations, which ignores real hazard patterns and actual vulnerability. Disaster vulnerability is measured using proxy indicators rather than a robust hazard-risk index, leading to misaligned funding and underestimation of local risk profiles.
5. Increasing Fiscal Stress on States: Climate shocks and frequent disasters impose significant fiscal pressure on States, and the insufficient central support undermines their ability to recover and rebuild effectively.

Way Forward

1. Update Relief and Compensation Norms: The Union should revise compensation amounts to reflect current costs and reconstruction needs so that States can provide meaningful relief to affected families.
2. Establish Clear and Objective Disaster Classification Criteria: Clear definitions of “severe disaster” and automatic triggers for NDRF eligibility are necessary to reduce discretion and ensure fairness in fund allocation.
3. Adopt a Hazard-Risk Based Allocation Formula: The Finance Commission should incorporate scientific parameters such as hazard frequency, climate vulnerability, and exposure risk rather than relying solely on population and area.
4. Ensure Timely and Predictable Fund Releases: Disaster-response funds should follow automatic, rule-based transfers to States, allowing faster mobilization of resources during emergencies.
5. Strengthen Cooperative Federalism Mechanisms: Greater consultation between the Union and States, transparent formula-based disbursal, and joint preparedness planning can reinforce trust and collaboration.
6. Build State Capacities for Resilient Recovery: Investments in early warning systems, local infrastructure resilience, and capacity-building programs can reduce long-term dependence on central assistance.

Conclusion: India’s disaster-response financing system, though well-intentioned, has gradually moved toward a centralised model that risks weakening cooperative federalism. Strengthening objectivity, transparency, and scientific basis in fund allocation along with upgrading relief norms and enabling timely support can restore balance and enhance India’s ability to respond effectively to growing climate and disaster risks.

Question: India’s disaster-response financing system increasingly reflects centralisation and conditionality, posing challenges to cooperative federalism. Discuss. Also suggest measures to strengthen federal balance in disaster management.