Tamil Nadu’s auto industry, a key economic driver, is facing significant risks as extreme weather events such as floods, droughts, and cyclones become more frequent and intense
The Confederation of Indian Industry (CII) recently made known distressing information regarding climate vulnerability of Tamil Nadu’s automobile manufacturing industry. As floods, droughts, and cyclones are occurring more frequently and with greater severity, the auto industry which is a major contributor to the state’s economy is under great threat.
These clusters were focused on iron and steel based industries in Odisha, dairy and food processing units in Maharashtra, and that of automobile industry in Tamil Nadu. In as much as the dairy and iron industries were detected to be relatively responsive to the adverse impacts of climate change, the auto industry in Tamil Nadu was particularly classified as main risk area as its high exposure to climate change hazards but low mitigation capability.
This report which is part of CII’s project for industry called Building Climate Resilience for Indian Industry looks at the risk dimensions of exposure and sensitivity as well as adaptive capacity. Due to proximity to coastal areas and ports, Tamil Nadu’s auto industry is considerably vulnerable as these areas are prone to extreme weather and catastrophic events.
The CII in their recommendations has further suggested measures which can make the Tamil Nadu auto industry move ahead even in climate change situations. These include increasing the use of domestic suppliers for electric vehicle components by broadening the procurement base; regularly assessing the level of climate vulnerabilities of the supply chains; working with the state in the creation of strategic mineral reserves; analysing the level of climate vulnerability every six months, with suitable emphasis on raw material and component suppliers; and tracking supply chain risks like geopolitics and the economic health of suppliers. By taking these measures, the dwarfing effects of climate change on the auto industry are less able to be felt.
CII President Sanjiv Puri emphasised the importance of these critical actions, stating that businesses should address climate risks to safeguard their operations and future growth.
The CII's assessment serves as a stark reminder of the pressing need for the Indian auto industry and businesses across all sectors to take proactive steps to build climate resilience.
Chief Minister of Tamil Nadu MK Stalin also emphasised the importance of effectively managing unexpected and heavy downpours during the northeast monsoon, which has become commonplace in recent years due to their significant impact on the major industries of the state.