Accidents erode 2.7% of GDP each year

GDP loses its limb every time a road accident occurs

Published: Jul 21, 2009

Bad roads, bad driving and bad policing make Indian roads a virtual death trap. More than 100,000 people die every year in road accidents, and four times that many get injured. Families and friends bear the brunt. But, policy makers should be worried too, for these deaths cost the country at least 2.7 percent of its GDP.

 

Image: Amit Gupta/Reuters
In 2007, for which the latest data is available, India lost at least Rs 1.02 lakh crore on road accidents. Here’s the math. In 2000, the cost of road accidents was Rs. 55,000 crore, or 3 percent of GDP. This often quoted number comes from Dinesh Mohan, a professor at IIT-Delhi, who improved on a study by TCS that had found that India lost Rs 32,000 crore in 1995. He extrapolated this number to 2000 by taking into account higher fatalities (the number then had grown to 85,000) and increased cost of living.

If we extrapolate this to 2007, by which time the official toll had touched 1.14 lakh and cost of living had risen by 39 percent, the total cost comes to over exceeds Rs. 1 lakh crore. The real toll - fatalities are underreported by 5 percent and injuries by half - could push the numbers even higher.

So, how to save the lives and the money? First, enforce the laws. Over-speeding, drunken driving and not wearing helmets and seat belts are the main reasons for the high number of accidents. Also, introduce road safety audits. Now, India has none - neither for the new roads, nor for the existing ones.

Third, and probably more importantly, get honest with road accidents. Now, law makers hide behind poor statistics and say 83 percent of the deaths are caused by drivers fault. It’s easy to blame the driver, when the real problem might have been a pothole.

A study in Hyderabad found that police tend to record most cases as having occurred due to the “negligence of the driver” to avoid court proceedings. Some probably like to believe Indians leave home with a death wish. Not true.

FAULT AND FATALITY
Overspeeding: A 5% rise in average speed increases crashes by 10% and deaths by 20%

Drunken Driving: There’s a lack of enough check points and breath testing. These simple measures will cut deaths by 20%

Safety Gear: Often, people don’t wear helmets or seat belts. Helmets can reduce the risk of death by 40% and severe injury by 70%. Seat belts achieve 40% less fatality among front seat drivers.

(This story appears in the 31 July, 2009 issue of Forbes India. You can buy our tablet version from Magzter.com. To visit our Archives, click here.)

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