MSMEs in Tamil Nadu, Gujarat lack action plans to mitigate climate change impact
Micro, Small and Medium-scale Enterprises (MSMEs) in Gujarat and Tamil Nadu are not prepared for climate change impacts, according to a study done by the
Micro, Small and Medium-scale Enterprises (MSMEs) in Gujarat and Tamil Nadu are not prepared for climate change impacts, according to a study done by the WRI. The report - Risk and Resilience of Micro, Small and Medium Enterprises to Climate Change: A Vulnerability Assessment in the Manufacturing Sector of Gujarat and Tamil Nadu - found that while Indian MSMEs are increasingly exposed to climate-related disruptions, there is a “significant actionability gap”. According to the study that covered 310 MSMEs in Surat, Chennai, and Coimbatore, awareness of climate change had not translated into practical preparedness and resilience measures.
Many MSMEs operated with limited financial buffers and had limited access to formal risk management tools. Only 13 % of the MSMEs said they had a formal business continuity plan and 21 % maintained emergency funds to manage climate-related disruptions. Almost 56 % of enterprises had some form of insurance, though the coverage was largely limited to conventional risks such as fire and health insurance. Only 17 % had flood insurance, the study found. Workers in 92 % of the surveyed MSMEs reported operational impacts due to heat stress, 78 % reported reduced worker productivity due to heat, more than half reported increased worker absenteeism linked to heat exposure, and 41 % reported heat-related illnesses among workers.
Thus, heat stress was found to affect worker health, attendance, productivity and operating hours. However, 89 % relied on basic ventilation systems and only 12 % had adopted effective measures such as cool roofs or insulation. Similarly, floods disrupted transport and logistics, delayed raw material supply, damaged inventory and
machinery, reduced labour availability, interrupted production cycles, led to loss of market access, and delayed deliveries, and increased operational and recovery costs. These units largely relied on short-term flood coping measures, such as relocating or safeguarding assets and only 19 % had adopted long-term measures to reduce flood damage.
The BriefWire