- Kerala has released its first comprehensive urban policy, focusing on urban planning, climate resilience, and financing.
- The policy recommends risk-informed master plans, real-time data systems, and skilled municipal personnel.
- The policy suggests green fees, climate finance advisory support, municipal bonds, and parametric insurance to finance climate resilience.
On March 30, the Kerala Urban Policy Commission submitted the state’s first-ever comprehensive urban policy, focusing on urban planning, climate resilience, and financing, to prepare Kerala for rapid urbanisation and the growing threat of climate change.
The Kerala Urban Policy Commission (KUPC) was set up in December 2023 to develop this policy given Kerala’s increasing urbanisation and climate vulnerability. As per the Commission’s projections, 80% of the state’s population would be urban by 2050. Besides, Kerala is one of the most vulnerable states to climate risk due to its geographic location, population density, susceptibility to extreme weather events, etc.
“We found that there is a distinct urban sprawl concentrated in the midlands of the state. It is squeezed between the coast on one side and highlands/hills on the other, both of which are under severe climate threat,” says KUPC’s chairperson M. Satish Kumar. “Though the midlands offer some stability, the climatic regime there is disrupted too. For example, these areas have had severe droughts in the past few years. So even those who are ready to move [from at-risk areas] to the midlands would be impacted.”
The Commission, composed of 10 experts and two municipal representatives, has given several recommendations to empower urban local bodies (ULBs) with financial and human resources and better data. It discusses incorporating risk factors in the urban planning process and ways of mobilising finance.
The Commission drew up on 33 short studies it commissioned and 53 stakeholder consultations to prepare the report. They prepared population projections for the state based on the 2011 Census data and used real-time satellite images to understand the nature of Kerala’s urbanisation.
“Kerala is now the only state in India having an urban policy,” claimed M.B. Rajesh to the media while submitting the 2,359-page report to the Chief Minister of Kerala.

Integrating climate resilience into master plans
Given the scale of climate threats in Kerala, the Commission recommends that the state develop a risk-informed master plan at the local level to integrate climate resilience into urban planning. All spatial plans of cities, such as Disaster Management Plans, Local Area Plans, and Master Plans, should follow this framework to ensure risk-sensitive development, it says.
But for this, real-time data and technically skilled personnel should be available at the municipal level, says Kumar, the chairperson of KUPC. Hence, the Commission has recommended setting up a state-level Digital Data Observatory at the state-supported Kerala Institute of Local Administration (KILA), with technical help from the National Institute of Technology, Calicut.
The observatory, as recommended by the commission, is expected to use existing datasets from national and state institutions and collect further topographic and sub-surface data of cities through LIDAR surveys, Ground Penetrating Radar (GPR) mapping, etc. The policy also suggests setting up more automated weather stations and tide gauges across the state to provide real-time data to the observatory. The KILA observatory would further be integrated with urban observatories that would be set up in municipalities.
“Municipalities should have data to make risk-informed master plans and get people away from eco-sensitive zones. Currently, people tend to return to the same disaster-hit areas. For example, the recent Wayanad landslides occurred in an area where landslides had previously occurred,” says Kumar and adds, “Kerala government already has a lot of data, but this is in silos and inaccessible to municipalities.”
He adds that municipalities also need a whole cadre of experts in big data, geospatial analysis, etc., to monitor real-time data continuously. For this, the Commission has suggested setting up a specialised cell for climate and disaster management under each municipality. It also suggests a municipal staff recruitment system so as to professionalise urban local governments and launch a new ‘Jnanashree’ programme under which urban youth would give technical support to municipalities.

Kumar says that KILA, along with the state’s premier science institutions, would have a key role in building these capabilities in municipalities.
The KUPC report also recommends updating the state’s municipal and panchayat building rules by integrating climate risk and disaster resilience provisions. The Kerala Municipality Building Rules (KMBR) apply uniformly to all municipalities of Kerala. Similarly, the Kerala Panchayat Building Rules (KPBR) apply to all panchayats. Because of this, when disaster resilience is incorporated into the Rules, it’s important to take into account the variations in climate data among districts, says Kumar. “This needs the buy-in of the public, like in Nordic countries. Also, the rules would have to accommodate the varying needs in different parts of the state. For example, the heat resistance needed for buildings in Palakkad district will be much higher than that in Thiruvananthapuram,” says Kumar.
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Generating climate funds
The KUPC report gives significant emphasis on the revenue generation required to achieve its sustainable goals. It recommends a green fee on urban development projects, which would be channelled into resilient infrastructure, emergency response and other initiatives to reduce climate disaster risk.
Kumar says these development projects could be any project with an ecological cost – for example, an infrastructure project that cuts across green areas, parking fees on car owners to offset the environmental costs of the state’s transition from public to private transport, etc. “But if a project is proposed in a highly eco-sensitive area, the question is whether it can be allowed upon payment of the green fee. It is up to the government how to implement it. The Commission has not given specific recommendations on this,” says Kumar.
The report also recommends setting up a Climate Finance Advisory Cell at the state level to help municipalities access climate financing options like green funds, carbon finance, and loans from multilateral agencies. This would include funds for rural areas that are transitioning to urban spaces now. It also talks about preparing bigger municipal corporations like Thiruvananthapuram, Kochi and Kozhikode to leverage municipal bonds by assessing their financial health and credit rating while it talks about pooled municipal bonds for other local bodies.
A third recommendation is that the state should establish a comprehensive climate risk insurance framework against climate disasters. This should be based on the parametric insurance model, under which the insurance company will pay a pre-agreed amount for the occurrence of a pre-defined event instead of making a payment based on the losses incurred. Experts should prepare the framework for this based on the Kerala State Action Plan for Climate Change.

“The state can draw on the expertise of central institutions like the Reserve Bank of India that are already working on this, as well as international organisations. The key challenge is sustaining the funding needed to cover the insurance premiums,” says Kumar. “The strength of the institution matters in this. Currently, municipalities in Kerala don’t have the capability to create bankable projects that will give some returns to investors. Their capabilities should be increased over time so that municipalities can insure locally vulnerable areas on their own.”
The report also suggests setting up Project Development Support Centres that can provide technical assistance to public and private sector organisations to build green, climate-resilient infrastructure projects and generate climate funding.
Will policy translate into practice?
Kerala-based environmentalist R Sridhar says the track record of successive state governments doesn’t give much hope for how the report will translate into practice. “An example is the Post Disaster Needs Assessment report that Kerala prepared with the support of the U.N. after the 2018 floods. It was a landmark report, but the Rebuild Kerala initiative that came out of it included projects like Silver Line that had nothing to do with the report.” Similarly, he believes that terms such as green fees, resilient infrastructure, and eco-industrial parks in the KUPC report can easily translate into nothing other than massive constructions.
“A report like this will work only if there is a high level of commitment and ecological literacy among leaders. Successive governments have only diluted laws on wetland conservation, biodiversity, etc. We don’t even have a proper land use policy or zoning concept as of now,” he says.
However, Kumar believes that the democratisation of data and the evidence-based approach recommended in the report would help convince citizens and governments. Eventually, “marking eco-sensitive zones is a political decision,” he says.
With the Cabinet expected to complete its deliberations on the report by the end of May, the following months may show how the report translates into action.
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Banner image: An aerial shot of Malappuram town in Kerala. The urban policy report estimates that 80% of Kerala’s population will be urban by 2050. Image by Truebrother via Wikimedia Commons (CC BY-SA 4.0).