Climate crisis existential threat; inflation adding to external risks: ITC's Sanjiv Puri

With the major global economies slowing down, steep inflation and bottlenecks in supply chain persisting, leading businesses in India like ITC are facing risks in the short-term, says Sanjiv Puri, Chairman and Managing Director of ITC Ltd., said in his address to the annual general meeting (AGM). Moreover, the emerging climate crisis is an existential threat that adds to the macroeconomic disruptions.

“While the potential is almost limitless, we are not immune to the adverse impact of several global crises including climate emergency, persisting inflation, supply chain disruptions, muted demand conditions in some major economies and the impact of geopolitical dynamics. The climate crisis represents an existential threat and in the short term, the impact of El Nino remains a key monitorable. Further, despite moderating inflation, key commodity prices remain elevated and volatile, adding to the magnitude of external risks,” Puri told ITC shareholders today.

Highlighting the emerging threat from climate change, Puri said that as per estimates climate induced events since 2000 have led to global losses of US$ 2.56 trillion in PPP terms. While India experienced extreme weather events on 84 of the 120 days in the first four months of 2023. By 2050, 30 Indian cities are likely to face acute water scarcity. “This planetary crisis is also aggravated by growing social inequity worldwide. Clearly, radical changes in growth models are imperative if future progress is to be sustainable and inclusive”. 

According to him, to address the issues ITC is undertaking a climate risk modelling exercise. “Recognising the need to comprehensively address the challenge of global warming, a climate risk modelling exercise using advanced analytics was undertaken at a pan ITC level, which was subsequently followed with site-specific and agri value chain-specific assessments so as to sharp target adaptation actions. Based on such studies, appropriate site-specific interventions are being progressed,” he said.

Further, the ITC Next Strategy - adopted by the company recently - is well equipped to tackle such risks and tweak its operations for the future threats. “The ITC Next strategy seeks to architect the next horizon of competitiveness, growth and profitability in the face of global uncertainties. It seeks to harness this potential and address the imperatives of fostering demand-responsive agriculture, accelerating value-addition, enhancing productivity, quality and farm incomes, strengthening competitiveness and tackling vulnerabilities arising from climate risks.”

In spite of multiple challenges, including inflation, demand slowdown and climate-related disruptions, Puri feels “the Indian economy demonstrated resilience, reporting robust growth”.