By Dina Rasheed, Akash Yadav, and Vishal Pathak, AIDMI, India

Small enterprises power India’s economy by employing more than 80 per cent of the workforce and contributing a substantial share of GDP, yet they are increasingly exposed to extreme heat that disrupts operations, lowers productivity, and harms worker health. Rising temperatures now threaten businesses in cities such as Ahmedabad, Surat, and Bhavnagar as well as rural districts including Varanasi and Kutch, where resources for cooling and adaptation remain scarce.

India’s warming trend is clear. Urban heat-island effects magnify daytime highs in dense centres like Ahmedabad and Surat, while states that depend heavily on outdoor labour—Uttar Pradesh, Gujarat, and Odisha—face parallel pressure in rural areas. Gujarat’s small food businesses struggle to keep perishables from spoiling as cooling costs climb. Agricultural workers in Odisha shorten shifts and confront crop failures linked to heat stress, and Uttar Pradesh recorded 96 heat-related deaths in June 2023, illustrating the human toll behind these figures.

Impacts across sectors and locations

• Urban street and small eateries see customer numbers fall during peak afternoon hours, slashing income.
• Construction workers in cities such as Surat face heatstroke, dehydration, and delayed timelines that inflate project costs.
• Food sellers in Kutch lose stock when frequent power cuts disable refrigeration.
• Home-based workers, particularly women, stitch garments or assemble goods in poorly ventilated rooms, raising indoor temperatures and reducing productivity.

Although some businesses adjust working hours or rely on fans, umbrellas, and reflective materials, these stop-gap measures cannot keep pace with longer heat spells.

Current initiatives and their limits
State heatwave advisories in Gujarat and Uttar Pradesh provide warnings, and Odisha’s tree-planting drives offer roadside shade. Ahmedabad has piloted reflective roof coatings that lower indoor temperatures. Yet such efforts are localised, underfunded, and weakly coordinated, leaving most enterprises without systematic support.

Wider sectoral repercussions
 Agriculture suffers when higher temperatures suppress wheat and maize yields, with even a one-degree rise, cutting output by up to 10 per cent. Early heat waves interrupt critical growing stages, and heavier irrigation and chemical use strain water resources and soil health. Clinics report spikes in heatstroke, dehydration, and cardiovascular complications, particularly among outdoor labourers, children, and pregnant women. Infrastructure buckles as roads melt and rail tracks warp, while heat-absorbing building materials drive up cooling demand in cities. Tourism declines when travellers avoid hot months, reducing revenue in destinations such as Kerala. Repeated crop losses and dwindling day wages push families to migrate, deepening economic insecurity.

Policy Priorities

1. Subsidise energy-efficient fans, coolers, and reflective roofing for micro and small firms, and promote tree cover and reflective surfaces in city plans to curb heat-island effects.
2. Create sector-specific safeguards for construction and agriculture, including shaded rest areas, flexible schedules, and health insurance that covers heat illnesses.
3. Strengthen early-warning systems so heat advisories reach both urban and rural enterprises through SMS, radio, and local-language apps.
4. Offer subsidised loans and grants that help businesses recover after heat shocks and invest in insulation, refrigeration, and backup power.
5. Formally recognise extreme heat as a disaster to unlock response funds and give Heat Action Plans legal force.
6. Improve data on heatwave patterns, health outcomes, and business losses so that officials can target the most vulnerable districts with evidence-based measures.

Targeted cooling support, worker protections, reliable alerts, and accessible finance can help India’s small enterprises remain productive and safeguard livelihoods as temperatures continue to climb.