As the first news reports of the devastation caused by the tsunami killer waves began to pour in, a newsreader on Aaj Tak’s Headline Today television channel asked his correspondent reporting from the scene of destruction in Tamilnadu in south India : “Any idea about how much is the loss to business? Can you find that out because that would be more important for our business leaders?”

Little did the newscaster realise or even know that the tsunami disaster, which eventually turned out to be a catastrophe, was more or less the outcome of faulty business and economics. Since the 1980s, the Asian sea-coast region has been plundered by the large industrialised shrimp firms that brought environmentally-unfriendly aquaculture to its sea shores. Shrimp cultivation, rising to over 8 billion tonnes a year in the year 2000, had already played havoc with the fragile eco-systems. The 'rape-and-run' industry, as the Food and Agricultural Organisation of the United Nations (FAO) once termed it, was largely funded by the World Bank. Nearly 72 per cent of the shrimp farming is confined to Asia.

Shrimp farms are abandoned every 2-5 years, leaving behind toxic waste and destroyed ecosystems. The whole cycle is then repeated in another pristine coastal area.
The expansion of shrimp farming was at the cost of tropical mangrove forests -- amongst the world’s most important ecosystems. Each acre of mangrove forest destroyed results in an estimated 676 pounds loss in marine harvest. Mangrove swamps have been nature’s protection for the coastal regions from the large waves, weathering the impact of cyclones, and serving as a nursery for three-fourth of the commercial fish species that spend part of their life cycle in the swamps. Mangroves in any case were one of the world's most threatened habitats but instead of replanting the mangrove swamps, faulty economic policies only hastened its disappearance.

Ecologists tell us that mangroves provide double protection – the first layer of red mangroves with their flexible branches and tangled roots hanging in the coastal waters absorb the first shock waves. The second layer of tall black mangroves than operates like a wall withstanding much of the sea’s fury. Mangroves in addition absorb more carbon dioxide per unit area than ocean phytoplankton, a critical factor in global warming.

Shrimp farming has continued its destructive spree, eating away more than half of the world's mangroves. Since the 1960's, for instance, aquaculture and industrial development in Thailand resulted in a loss of over 65,000 hectares of mangroves. In Indonesia, Java lost 70 per cent of its mangroves, Sulawesi 49 per cent and Sumatra 36 per cent. So much so that at the time the tsunami struck in all its fury, logging companies were busy axing mangroves in the Aceh province of Indonesia for exports to Malaysia and Singapore.

In India, mangrove cover has been reduced to less than a third of its original in the past three decades. Between 1963 and 1977, India destroyed nearly 50 per cent of its mangroves. Local communities were forcibly evicted to make way for the shrimp farms. In Andhra Pradesh, more than 50,000 people were forcibly removed and millions displaced throughout the country to make room for the aquaculture farms. Whatever remained of the mangroves was cut down by the hotel industry, virtually aided and abetted by the Ministry of Environment and Forests and the Ministry of Industries.

Five-star hotels, golf courses, industries, and mansions sprung up all along disregarding the concern being expressed by environmentalists. These two ministries worked overtime to dilute the Coastal Regulation Zone (CRZ) norms thereby allowing the hotels to even take over the 500 meter buffer that was supposed to be maintained along the beach. In an era of market economy that was reflected through a misplaced Shining India slogan, bureaucrats are in league with the industrialists and big business interests.

The tourism boom in the Asia-Pacific region coincided with the destructive fallout of the growth in shrimp cultivation. Over the last decade, tourist arrivals and receipts rose faster than any other region in the world, almost twice the rates of industrialized countries. Projections for the year 2010 indicate that the region will surpass the Americas to become the world's number two tourism region, with 229 million arrivals. What is being projected as an indicator of spectacular economic growth hides the enormous environmental costs that these countries have suffered and will have to undergo in future.

In the past two decades, the entire coastline along the Bay of Bengal, Arabian Sea, and Strait of Malacca in the Indian Ocean and all along the South Pacific Ocean has been a witness to massive investments in tourism and hotels. But Myanmar and Maldives suffered very less from the killing spree of the tsunami because the tourism industry had so far not spread its tentacles to the virgin mangroves and coral reefs surrounding the coastline. The large coral reef surrounding the islands of Maldives absorbed much of the tidal fury thereby restricting the human loss to a little over 100 dead. Coral reef absorbs the sea’s fury by breaking the waves.

The tragedy however is that more than 70 per cent of world’s coral reef has already been destroyed. The island chain of Surin off the west coast of Thailand similarly escaped heavy destruction. The ring of coral reef that surrounds the islands did receive some punching from the furious waves but remained firm and thereby helped break the lethal power of the tsunami. Mangroves also help to protect offshore coral reefs by filtering out the silt flowing seawards from the land. Tourism growth, whether in the name of eco-tourism or leisure tourism, decimated the mangroves and destroyed the coral reefs.

Mangrove forest, Bhiterkanika, Orissa, India. Photo: Alfredo Quarto of Mangrove Action Project,

If only the mangroves were intact, the damage from tsunami would have been greatly minimized. It happened earlier in Bangladesh. In 1960, a tsunami wave hit the coast in an area where mangroves were intact. There was not a single human loss. These mangroves were subsequently cut down and replaced with shrimp farms. In 1991, thousands of people were killed when a tsunami of the same magnitude hit the same region. In Tamilnadu, in south India, Pichavaram and Muthupet with dense mangroves suffered low human casualties and less economic damage from the Dec.26 tsunami. Earlier, the famed mangroves of Bhiterkanika in Orissa (which also serve as the breeding ground for the olive-ridley turtles) had reduced the impact of the ‘super cyclone’ that had struck in Oct 1999, killing over 10,000 people and rendering millions homeless.

The epicenter of the Dec 26 killer tsunami was close to Simeuleu Island, in Indonesia. The death toll on this particular island was significantly low simply because the inhabitants had the traditional knowledge about tsunami that happened after a quake. In Nias Island, which is close to Simeuleu, mangroves had acted like a wall helping people from the destruction. The challenge for the developing countries is to learn from the time-tested methods that have been perfected by the local communities.

Look at the comparative advantage of protecting environment and thereby reducing the havoc from the growth-oriented market economy. Having grown tenfold in the last 15 years, shrimp farming is now a $9 billion industry. It is estimated that shrimp consumption in North America, Japan and Western Europe has increased by 300 per cent within the last ten years. But one massive wave of destruction caused by the Dec 26 tsunami in 11 Asian countries alone has surpassed the economic gain that the shrimp industry claims to have harvested by several times. With over 1,50,000 people dead, the staggering social and economic loss will take some time to be ascertained.

World governments have so far pledged US $ 4 billion in aid. This does not including the billions that are being spent by relief agencies. World Bank is in addition considering boosting the aid packet to US $ 1.5 billion. It has already given (Jan 10, 2005) $ 175 million, and bank President James Wolfensohn has been quoted as saying: “We can go up to even $ 1 billion to $ 1.5 billion depending on the needs…” In addition, the World Food Programme (WFP) plans to feed some 2 million survivors for the next six months. The feeding operation is likely to cost US $ 180 million. But if only successive presidents of the World Bank had refrained from aggressively promoted ecologically unsound but market friendly economic policies, a lot of human lives could have been saved.

But can Wolfensohn justify the financial backing doled out to the aquaculture and tourism sectors by drawing a balance sheet of the costs and benefits, including the social cost involved? After all, despite warning by ecologists and environmentalists, the World Bank turned a deaf ear. The magnitude of the disaster was only exacerbated by the neoliberal economic policies that pushed economic growth at the expanse of human life. It was the outcome of an insane economic system – led by the World Bank and the Internation Monetary Fund (IMF) – that believes in usurping environment, nature and human lives for the sake of the unsustainable economic growth for a few.

Take the shrimp farms, for instance. The life cycle of a shrimp farm is a maximum of two to five years. The ponds are then abandoned leaving behind toxic waste, destroyed ecosystems and displaced communities, annihilating livelihoods. The farms come up at the cost of natural ecosystems including mangroves. The whole cycle is then repeated in another pristine coastal area. The WWF and other environmental organisations have quoted one estimate -- economic losses due to the shrimp farms are approximately five times the potential earnings.

It was only after tsunami struck that the Kerala state government was quick to announce an Rs 340-million project aimed at insulating the coastline against tidal surges.


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Tourism is no better. Kerala in south India, marketed as “God’s own country”, destroyed the mangroves in a desperate bid to lure the tourists. It is only after tsunami struck that the state government was quick to announce an Rs 340-million project aimed at insulating the Kerala coastline against tidal surges. Other tourist destinations in Asia will now probably go for a rethinking.

The question therefore that needs to be asked is whether we need to extract a heavy human toll before we realize the follies of aping the market economy mantra blindly? How many more need to die and how many millions we want to go homeless before we realize the grave mistake? Who will hold governments and free market economists responsible for the human loss and suffering?