The 16th Finance Commission's disaster funding formula uses total state population as the "exposure" metric instead of, you know, actual exposure to disasters. Result: Odisha, which has the highest hazard score and near-zero cyclone mortality, loses the most funding. Uttar Pradesh, which is mostly threatened by potholes, gains the most.
The 16th Finance Commission increased India's State Disaster Response Fund by a generous 59.5% to ₹2,04,401 crore — and then distributed it using a formula so mathematically perverse that the state most likely to be hit by a cyclone gets the smallest cheque. The new Disaster Risk Index uses a multiplicative model of hazard × exposure × vulnerability, which sounds scientific until you learn that "exposure" is measured by total state population rather than the population actually living in hazard-prone areas. This means Uttar Pradesh and Bihar — states whose primary natural disasters are governance-related — receive disproportionately high exposure scores simply because a lot of people live there. Odisha, which sits in the direct path of Bay of Bengal cyclones, has the highest hazard score in the country, and has spent decades building early warning systems that reduced cyclone deaths to near zero, gets rewarded for its competence by having its funding share slashed. The Commission essentially created an incentive structure where states are penalized for getting better at disaster management and rewarded for being large. If you wanted to design a formula that punishes competence and rewards headcount, you couldn't do better than this.