Risk & Risk Management

Risk, in simple words, is any uncertain condition or event which may arise in future and has
harmful effects. Risks may be small or big affecting different communities at different levels.
Therefore managing risks as we know is confronting risks, preparing for them and coping
with their effects.
The first week provided us information about different risks faces by different countries and
how they dealt with the future occurrence of the risk to reduce its impact like natural
calamity in Bangladesh (1970 and 2007), international financial crisis in 3 diverse countries-
Czech Republic, Kenya and Peru (1990 and 2008/09), food insecurity in Ethiopia (1999 and
2005), and rainfall insurance for farmers in India.
As discussed, the main objectives of risk management are providing resilience and achieving
prosperity. In spite of risk management being such a necessity for every economy, they fail
to take necessary actions due to fear of failure, lack of incentives, indifferent behaviour and
many other reasons. The effect of risk management can either be amplified or reduced
depending on a persons internal conditions, external environment and the risk
management policies undertaken.

The most important thing I learnt in this course besides the importance of risk management
is the actions that can be taken at different levels for risk management i.e. household,
community, enterprise sector, financial system, state and international community.
Now, taking India into consideration, Ill discuss some risks quite unheard of but having a
great impact.

Poverty and over-population are some biggest issues that India faces and which has led to
many other problems.



These are some of the very common sites in every Metropolitan city of India where poverty
stricken people like labourers, beggars people sleep on roadsides as they cannot afford
buying themselves a decent living. These people live on the edge of life and death. Every
now and then there is a news article that speaks of the loss of lives of people sleeping on
roadside being killed by the moving traffic. A big risk persists to the life of these people.
Management of this risk is very important.
Risk Management is very essential for this. Understanding the reason for this risk is very
necessary. Poverty and unemployment forces people to risk their lives to sleep on roadsides
and footpaths. Measures must be taken to reduce these causes. State Government should
guarantee jobs for these people and provide them a decent living at cheap rates.
Even financial institutions can help these people by providing credit at cheaper rates and
accepting deposits. Recently, Indian government started the policy to ensure employment
namely, Mahatma Gandhi National Rural Employment Guarantee Scheme.

Another risk our country faces is the risk of lives due to disposal of huge amount of wastes in
the water bodies. Industrial, domestic wastes are all disposed off in the water bodies
through sewages and other means. And most of our population rely on water from these
sources. Risks include diseases like diarrhoea, cholera. It becomes the breeding ground for
insects which spread the diseases like malaria.



Strict rules and regulations should be created by the government to treat the wastes before
they are disposed in the water. People should be made aware of the ill-effects of disposing
the wastes before the problem actually occurs.