India Must Spend Big on Climate-Ready Cities: Experts Decode World Bank Report

India must invest in making its cities climate-resilient to avoid future economic losses, notes a World Bank report.

India must invest in making its cities climate-resilient to avoid future economic losses, warns a World Bank report.

(Photo: Vibhushita Singh/The Quint)

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Without urgent action, India’s cities could suffer severe damage from growing climate threats like floods, extreme heat, and rising emissions, warns a new report by the World Bank titled “Towards Resilient and Prosperous Cities in India.”

The report notes that India’s urban population is expected to nearly double to 951 million by 2050, and that this rapid growth offers a critical opportunity to build more climate-resilient cities to avoid future losses. This will, however, require a massive investment of $2.4 trillion by 2050 and $10.9 trillion by 2070.

"What this report has done is try to quantify how much climate-resilient investment is required with reference to the rate at which the population is growing," says Abinash Mohanty, Sector Head for Climate Change & Sustainability at IPE Global.

The Quint spoke to experts to unpack its key findings and understand what they mean for India’s urban future.

Cities Are Economic Engines...and Climate Risk Hotspots

The report highlights that India’s cities have the potential to become key drivers of economic growth, with projections indicating they could generate 70 percent of new jobs by 2030 and contribute 75 pecent of the country’s GDP by 2050.

However, this potential is at serious risk due to rising climate threats, particularly urban flooding and extreme heat.

According to the report's findings, flood-related damages already cost India an estimated $4 billion each year, a figure that could rise sharply without intervention.

At the same time, exposure to extreme heat in the country’s largest cities has increased by 71 percent over the past three decades, with heat-related deaths projected to more than double to 328,500 annually by 2050.

These climate threats not only put lives at risk, especially in vulnerable informal settlements, but also threaten to disrupt productivity and overload vital urban infrastructure.

The report, which analyses 24 Indian cities with a focus on Chennai, Indore, New Delhi, Lucknow, Surat, and Thiruvananthapuram, finds that timely adaptation measures can avert billions of dollars of annual losses from future weather-related shocks.

Speaking to the Quint, Aravindan Srinivasan, Executive Director, Climate Action Platform at AVPN, a social impact network based in Asia, says, "In the Indian context, cities are a major engine of growth. Most of the development model is hinged upon urbanisation, so from that point of view, tackling urbanisation is a fundamental co-benefit area."

He goes on to say that this is true across most cities in Asia. "Most of the cities in Asia are in a developmental stage going from low income to middle income or from middle income to high income. And if we are not able to intervene at this stage with better urban planning, then we will have to pay double the price or even more than that later."

So the question that arises is, as we are designing our new cities and expanding our existing cities, how do we do that more thoughtfully?

Take the example of Gurugram, a city increasingly vulnerable to heavy, recurring rainfall. It faces waterlogging, flooding, and significant damage to life and property multiple times a year. One of the core issues here, experts point out, is that urban development has outpaced planning—we’ve built cities without fully assessing their resource-to-population carrying capacity.

“If you're constructing drainage infrastructure, it’s essential to factor in how much water it needs to handle during a day of extreme rain,” says Mohanty.

“Even if that means investing an additional $100 upfront, it's a cost worth incurring to avoid far greater losses down the line,” he adds.

"Its not just resilience towards what is already happened, but reducing the aftershocks that will happen if we don't become carbon neutral."

Aravindan Srinivasan, Executive Director, Climate Action Platform at AVPN

'Making Indian Cities Climate-Proof Will Require $2.4 Trillion'

One of the report’s key findings is that India will require a massive investments of $2.4 trillion by 2050 and $10.9 trillion by 2070 to meet the need for new, resilient, and low-carbon infrastructure and services in cities.

"There's more to consider than the absolute population numbers, because understanding the climate vulnerability of India is different to understanding the climate vulnerability of the different states and different cities, and even areas within cities."

Abinash Mohanty

"When you look at a country as geographically and topographically diverse as India, the challenges that different cities face can be very diverse and require different approaches and different levels of investment. So it's clear that one-size-fits-all solutions won’t work," he adds.

Adding to this, Purnamita Dasgupta, Head of Environmental and Resource Economics Unit at the Institute of Economic Growth, Delhi, says, "Big numbers like this help us see the scale or magnitude of the challenge and the solution, but on their own, they’re hard to make sense of. Only when you break them down and provide context can you see the true granulated picture, and it becomes possible to understand how to prioritise action."

"What really matters is understanding how much investment each city needs and calculating what I’d call the economic development to loss-and-damage ratio. The broader your portfolio of preparedness and resilience, the more you reduce overall risk."

Abinash Mohanty

“The report serves as a useful reminder of the scale of funding required as a starting point, but it should now be used to define the climate resilience investment pathways for each city, since the needs of each city will vary widely.”

Bridging the Urban Climate Finance Gap

The report stresses that building climate-resilient cities will require a comprehensive financing strategy involving both public and private sectors.

At present, the private sector contributes only about 5 percent of total urban infrastructure investment in India.

To scale this up, the report calls for the creation of an “enabling ecosystem”, which includes addressing policy and regulatory hurdles, improving financial instruments, and ensuring that urban projects can generate steady and transparent cash flows.

"The challenge is how do we incentivise and bring in regulations that act as both carrot and stick to the private sector to adhere to this, otherwise perverse incentives will prevail.”

Aravindan Srinivasan, Executive Director, Climate Action Platform at AVPN

A key issue, he notes, is the weak financial capacity of cities themselves.

“Cities, unfortunately, aren’t great at raising their own financing. They’re heavily dependent on central and state government grants. This is a fundamental problem. So, the first step would be to fix city revenues, maintain better books of accounts, and use that credibility to access broader capital markets. There’s capital out there, but not enough avenues for cities to tap into it,” he explains.

He also emphasises the importance of transparency and accountability in public finance to build investor confidence.

“If we want the private sector to come in, cities need to be more transparent about how funds are being used,” he adds.

Blueprints Exist, But Implementation Lags Behind in India's Climate Plans

The report outlines a 10-Point Climate Action Plan or a blueprint that cities can adopt to strengthen resilience. The recommendations include:

• Regularly assessing climate risks

• Creating inclusive early warning systems

• Climate-smart urban planning

• Reducing risks from floods and heat

• Protecting vulnerable communities

• Engaging the private sector

• Planning compact, green cities

• Improving waste and water services

• Building green transport systems

• Promoting energy-efficient homes

While this serves as a solid starting point for newly developing urban centres, experts say, most major Indian cities already have climate action plans in place. However, it's implementation that remains a significant challenge.

“None of the climate action plans that have been framed are even close to being fully implemented,” says Mohanty. “In some areas and sectors, implementation has begun and is showing promising results, but city-wide adoption is still lacking.”

For instance, Assam is taking steps to improve flood resilience, and Mumbai is working on a multi-hazard risk atlas to strengthen its emergency response, but, Mohanty notes these efforts are still in early stages and moving too slowly, especially when compared to the speed and scale of climate risks on the ground.

One of the major bottlenecks, he points out, is fragmented governance.

“What’s happening is very disjointed,” Mohanty explains.

“Infrastructure departments like the PWD often operate in silos. City-level mapping plans are rarely coordinated across departments, and they don’t incorporate future climate projections. That kind of forward-looking integration is still missing.”

Abinash Mohanty

“It’s not that we aren’t making any investments. We’re already doing quite a lot in terms of climate resilience,” he says. “But now, it’s high time we start translating that empirical evidence into concrete, scalable action.”