How the World Bank’s Next Generation Drought Index (NGDI) platform enables early, transparent drought risk financing

Rising food insecurity, driven by climate variability and other compounding factors, has increased the need for reliable drought monitoring to support early action. Vulnerable communities are most affected by severe and recurring droughts, yet fragmented datasets and inconsistent monitoring made it challenging for governments and partners to respond effectively. To address this, the World Bank’s Crisis and Disaster Risk Finance team engaged DHI to develop the Next Generation Drought Index (NGDI) platform, initially piloted in East Africa and integrating rainfall, soil moisture and vegetation data into advanced drought analytics. As the initiative scaled globally, the World Bank required a robust, user friendly platform to consolidate satellite data and support drought risk financing decisions. DHI delivered a system that turns complex climate data into actionable insights for early, evidence-based response decisions.

 

Challenge

As the leading cause of reduced agricultural production, drought affects harvests, diminishes livestock and pushes at-risk households into food insecurity – increasing poverty, driving migration and, in extreme cases, causing famine. Competition for shrinking water resources also intensifies social tensions, contributing to conflict and displacement.

 

The World Bank’s Crisis and Disaster Risk Finance team needed a better way to make timely and transparent drought-related financial decisions. Existing tools could not provide a clear, unified picture of when and where drought was emerging, leaving decision-makers without dependable evidence for early action or risk financing. Data scattered across multiple sources made it difficult to validate conditions, compare regions or design fair and defensible financial instruments.

They required a modern, scalable system that could turn drought data into actionable insights, enabling countries and partners to respond earlier and protect communities before impacts escalated.

 

Solution

Working closely together, DHI and the World Bank developed the Next Generation Drought Index (NGDI) platform that would bring clarity and confidence to drought-related financial planning. The initial phase was a prototype for East Africa that combined key satellite-based rainfall, soil moisture and vegetation datasets into one accessible platform. This gave governments and humanitarian partners a shared, transparent foundation for assessing drought severity and supporting early action and financing decisions.

Through workshops and consultations with government experts, humanitarian actors, insurance practitioners and regional partners, DHI gathered direct feedback on the initial platform’s limitations and the features needed for real-world use. These insights guided development priorities and shaped the transition to the next phase: a global drought intelligence platform.

The resulting system offers a user-controlled index design workflow backed by harmonised global data and operational APIs, turning climate signals into actionable, finance-ready decisions that enable earlier intervention and better protection for at-risk communities.