On August 4, the Ministry of Home Affairs told the Lok Sabha that heatwaves and lightning had been added to India’s list of notified natural calamities, taking the total list — including floods, cyclones, droughts, and landslides — to 14.
The change follows a recommendation by the Sixteenth Finance Commission (FC-XVI) and operational guidelines issued on June 30. Along with the 2024 amendment to the Disaster Mitigation Fund guidelines, the update means heatwaves are now eligible for the full State Disaster Risk Management Fund pool.
Disaster finance in India
Under Article 280 of the Constitution, the Finance Commission recommends arrangements for disaster management funds. The FC-XVI recommended Rs 2.04 lakh crore for State disaster funds in the five years between 2026-27 and 2030-31, nearly 28% more than the previous Commission’s allocation.
Of the total fund, ₹1.6 lakh crore goes to the State Disaster Response Fund (SDRF) and the rest to the State Disaster Mitigation Fund (SDMF). The SDRF is meant for response, relief, and reconstruction immediately following a disaster; the SDMF is meant to fund interventions to reduce the risk of a climate event from turning into a disaster, in the longer term.
These funds are available to all States. The FC-XVI has determined the inter-State distribution using a formula comprising a disaster risk index, which takes into account the frequency and intensity of different hazards along with exposure and vulnerability and expenses incurred by States during the previous commission’s tenure.
The FC-XVI recommended ₹79,406 crore for national disaster funds over the same period and which States can seek when a disaster is severe enough to exceed their own resources — like Kerala did following the Wayanad landslides in 2024.
Heat has thus far occupied an awkward position in the disaster finance system. A State could notify a heatwave as a ‘local disaster’ and use the SDRF — but only up to 10% of its annual allocation and after setting separate norms such as the amount of compensation for loss of lives or damage to crops. Other notified disasters such as floods and cyclones faced no such ceiling. The new notification removes this asymmetry.
Notifying heatwaves matters
India’s exposure to extreme heat is growing. The author used 35 indicators across climate change, exposure, and vulnerability to estimate that more than 57% of Indian districts, home to roughly three-fourths of the Indian population, face high- to very-high heat risk. The number of hot days per year has increased. The incidence of very warm nights and relative humidity have also risen, reducing the human body’s ability to recover after hot days. Rapid urbanisation adds an urban heat island effect, with one 2024 study in Nature Cities finding that India’s cities were warming twice as fast the rate of the rest of the country.
The latest health impact surveillance data underlines the risk. Despite being a summer marked by relief from unseasonal rains, between March 1 and July 26, India recorded more than 4,800 heatstroke cases and 20 confirmed heatstroke deaths across 51,000 reporting units under the National Heat-Related Illness and Death Surveillance system. During the record 2024 heatwave, some 45,000 heat-related illnesses were recorded, although the figure was likely an undercount.
What States can fund
The National Disaster Management Authority has asked all States, districts, and cities to develop heat action plans (HAPs), which map heat risk and vulnerability and identify short-, medium-, and long-term interventions. Thus far, 300 cities and districts across 23 heatwave-prone States have HAPs.
Implementation, however, has lagged because of limited technical capacity, competing priorities, and inadequate funding. A 2023 review of HAPs also found that 79% of the plans asked city departments to self-allocate funds.
The new Central notification provides States with two clearer financing options. Under the SDRF, they can provide relief and compensation for heat-related losses, including loss of life, crops and livestock, and infrastructure damage. And through the SDMF, they can finance longer-term risk reduction such as cooling shelters, early-warning systems, blue-green infrastructure such as nature-based solutions, and cool roofs. The respective State Disaster Management Authorities and State Emergency Operations Centre will be the nodal agencies responsible for both fund corpuses.
Next steps
First, heat planning must expand. Twelve states have already notified heatwaves locally but only some 300 cities and districts have HAPs, leaving around 4,800 urban local bodies and 800 districts without them. Heat-specific SDMF guidelines are still awaited, but existing guidelines require risk and vulnerability assessments before any projects are proposed — precisely the groundwork HAPs are meant to provide.
Second, plans must become fundable projects. States need model mitigation proposals suited to local climate and geography: what works in dry inland Delhi may not work in humid Kolkata. Many local bodies lack the technical capacity to prepare such proposals. Research institutions, NGOs, and philanthropy could provide technical support and risk capital to help convert plans into appraisable projects.
Third, health surveillance must improve. Relief payouts will now depend on accurate loss-and-damage data. The Health Ministry’s current surveillance system covers over 51,000 reporting units and recorded 4,853 heatstroke cases and 20 confirmed heatstroke deaths between March 1 and July 26. But it misses the wider burden from heart, lung, and kidney conditions worsened by heat. States need to report accurately and will need health capacity enhancement to that end.
Fourth, States should look beyond disaster funds alone. States should link heat solutions to other government development schemes by identifying convergence, and use fast, pre-agreed tools like parametric insurance, which pays out automatically once a set temperature threshold is crossed. Similar tools already operate for other hazards; Nagaland, for example, has rainfall insurance that pays out when rainfall levels cross a set threshold.
Shravan Prabhu is Programme Lead at Council on Energy, Environment and Water (CEEW) and Coordinator of the GHHIN South Asia Heat & Health Hub.
Published – August 27, 2026 08:30 am IST
