SMALL PLANTS, BIG TROUBLE

Climate-triggered stress is placing an unprecedented burden on small businesses. But a lack of access to climate aid hinders the sector's ability to adopt greener methods

- Sudipto Dey

When the skies opened up on December 4, 2023 in Chennai, industrial operations in the neighbourhood of Ambattur decided to call it a day. Before long, water had entered industrial units housing high-value machines. Lakes in the region started to overflow. Run off from two areas—Avadi and Poonamalle—had added to the overflow, it was later determined.

Ambattur is the largest smallscale industrial estate in South Asia. As Chennai and its adjoining districts went under water, so did units that were home to micro, small and medium enterprises (MSMEs). Losses to the sector were estimated to be over Rs 7,000 crore. Once the rains subsided, the Chennai Municipal Corporation reportedly said the city had not seen a similar downpour in close to 50 years.

The unequal impact of the climate crisis is becoming increasingly visible on industrial operations and workers. In the Chennai floods of 2015, the MSME sector lost over Rs 1,700 crore due to disruption in production. Eight years later, Cyclone Michaung amplified those losses in the city many times over.

The Case for Aid

Small producers and manufacturers are on the frontlines of the battle against climate change, often bearing the brunt of extreme weather events that disrupt their operations and the value chain. Climate-proofing these systems is critical, but the issue of climate finance to the Global South remains the elephant in the room.

Billed as the ‘finance COP’, the next UN climate conference, COP29, is taking place in Azerbaijan’s capital Baku from November 11–22. It is expected to iron out differences related to climate finance flows between developing and developed countries even as these differences continued to weigh down conversations at recent pre-COP negotiations.