Beyond Cash Aid: ADB Reveals Why Climate Resilience Needs Stronger Local Infrastructure and Support

An Asian Development Bank report reveals how outdated welfare systems, weak infrastructure, and limited local financing leave vulnerable communities in Indonesia and Nepal exposed to growing climate risks. It urges governments to combine household assistance with infrastructure investments, empower women-led organizations, and strengthen local governance to build lasting climate resilience.

The Asian Development Bank (ADB), through its Community Resilience Partnership Program (CRPP), has highlighted serious weaknesses in government efforts to protect vulnerable communities from climate change. Drawing on research by the Huairou Commission, in collaboration with Indonesia's Yakkum Emergency Unit and Nepal's Lumanti, its October 2026 report, Enabling Inclusive Climate Resilience Through Local Development Programs, finds that traditional poverty-reduction programs often fail to reach people facing the greatest climate risks. The findings suggest that governments can strengthen climate resilience without creating entirely new schemes by improving existing welfare programs, investing in essential infrastructure, empowering local institutions, and ensuring financial assistance reaches those who need it most.

The research, conducted during 2023–2024, involved 40 grassroots women's groups in Gunungkidul, Indonesia, and Kalaiya, Nepal. Both locations face poverty, water shortages, weak infrastructure, and growing climate pressures. Through community risk mapping and assessments of government programs, researchers examined how drought, unpredictable rainfall, declining water availability, and inadequate public services affect livelihoods. The findings show that women, older people, persons with disabilities, landless households, migrants, and marginalized communities face particularly serious challenges.

Climate Risks Are Leaving Vulnerable Families Behind

One of the report's most important findings is that government welfare programs often fail to recognize how climate change affects household vulnerability. Traditional assistance schemes generally rely on income, household assets, and outdated beneficiary records without adequately considering environmental exposure, geographic isolation, or sudden livelihood losses.

In Indonesia's Gunungkidul district, grassroots women identified families overlooked by government assistance programs. These included widows, older people living alone, households affected by chronic illness, and families forced to borrow from informal lenders after losing income because of climate-related disruptions.

The findings demonstrate that poverty cannot be measured through income alone. A household may become highly vulnerable when drought destroys agricultural production, water sources disappear, or debt increases following an environmental shock.

The ADB recommends adding climate vulnerability indicators to existing welfare systems. Local governments and community organizations should regularly verify household conditions, update beneficiary databases, and identify newly vulnerable families following droughts, floods, migration, or economic disruptions. Such changes could reduce exclusion errors and ensure public assistance reaches those facing the greatest risks.

Why Cash Assistance Alone Cannot Build Climate Resilience

The report warns that financial assistance and agricultural support often deliver limited long-term benefits when communities lack reliable infrastructure. Cash transfers, farming equipment, seeds, and livelihood assistance cannot significantly improve resilience if households struggle with water shortages, damaged roads, inadequate irrigation, and poor storage facilities.

Evidence from Kalaiya, Nepal, illustrates this problem. Participatory assessments across two municipal wards identified 125 vulnerable households, including 92 classified as ultra-poor. Researchers also identified 30 women-headed households, including widows, alongside two older people and one person with a disability requiring additional assistance.

Many families depended on agriculture and livestock, but recurring droughts and unreliable irrigation restricted their ability to maintain production and income. Even households receiving assistance struggled because the basic infrastructure needed to support their livelihoods remained inadequate.

To address this challenge, the ADB recommends an approach called "layering," which combines household assistance with community infrastructure investments. Governments should prioritize reliable water supplies, irrigation systems, roads, food storage, and essential services while coordinating assistance with drought seasons and harvest shortfalls.

Empowering Local Governments and Women-Led Communities

Another major finding is that local governments often understand community problems but lack the authority, resources, and financing needed to address them. National welfare and development programs frequently operate independently, creating gaps in coordination and delaying responses to changing climate conditions.

The report highlights the important role of grassroots women's organizations in identifying vulnerable families, mapping environmental risks, and monitoring government assistance.

However, community participation often remains informal and disconnected from official planning and budgeting.

The ADB recommends giving local governments greater responsibility for coordinating programs, correcting beneficiary records, and identifying infrastructure priorities. Women's groups and community organizations should receive formal recognition, training, and financial support to participate in planning, implementation, and monitoring.

Importantly, governments should avoid shifting unpaid responsibilities onto women and instead establish structured partnerships that strengthen public service delivery.

Financing Local Climate Action and Scaling Solutions

The report emphasizes that climate adaptation requires financing mechanisms capable of responding to local priorities. Conventional funding systems are often too rigid to support smaller projects such as irrigation repairs, water infrastructure, road maintenance, and livelihood improvements.

Drawing on community financing experiences in Indonesia and Nepal, the ADB recommends dedicated funding channels with transparent allocation rules, shared oversight, basic financial management, phased disbursement, and municipal co-financing.

Nepal's Urban Community Support Fund model demonstrated how stronger accountability can encourage local investment, with municipal contributions reaching 84.9% of total funding by 2022.

The report proposes a phased reform strategy that begins with improved beneficiary verification and community risk mapping in the first two years. Over the following two to five years, governments should strengthen institutional coordination and integrate climate risks into development planning. Beyond five years, these approaches should become permanent features of national welfare programs and public financing systems.

The central message is that climate resilience depends on connecting poverty reduction, infrastructure development, local participation, and accountable financing. By improving existing programs rather than creating parallel systems, governments and development partners can use public resources more effectively, protect vulnerable livelihoods, strengthen food security, and ensure communities facing the greatest climate threats are not left behind.