Sunday, April 26, 2020

Virus was easy, but what about poverty?

"The Indian lockdown is being regarded as one of the toughest in the world," wrote Chetan Bhagat. The lockdown is estimated to cost Rs 10 trillion. "If lives are priceless, they're worth saving at any cost -- that's the current mantra." However, this principle does not apply at other times. Our infant mortality rate is 3%, compared to 0.3% in the developed world. In Gorakhpur, 30 children died in 48 hours because the government hadn't paid Rs 6 million to the oxygen supplier. People died in Mumbai because footbridges were not repaired. India has 46.6 million stunted children "caused by long-term insufficient nutrient-intake and frequent infections". Despite requests to export rice and wheat to reduce overflowing stocks. And, of course, the Indian state does not hesitate to use extreme violence against citizens at the least provocation. The lockdown will lead to unemployment, with consequent increase in "depression, suicide rates, domestic violence, crime, terrorism". India is in an impossible position because unchecked infection with coronavirus may result in a mortality of 6.5 million people while the economic consequences of the lockdown will hurt the poorest among us, wrote Gurcharan Das. "The worst affected will be half a billion daily wage earners, many of whom may die of hunger." What is the solution? "One approach could be to have generous, but provisional aid program, which is unconditional and reversible," wrote Kwatra and Bhattacharya. "We can call this an EBI (emergency basic income)." But, what if those who have fled to their villages refuse to return? Will any politician be prepared to stop EBI and let starvation force laborers to return to their previous jobs in cities? To make matters worse, many of the over 8 million Indians working in Gulf countries may have to return home due to the precipitous fall in the price of oil, wrote Suhasini Haider. Remittances to India from abroad may decline by 23%, from $83 billion last year to $64 billion this year because of the global recession caused by the virus pandemic. "As per estimates, India is home to 69 million MSMEs  (micro, small and medium enterprises) with micro enterprises accounting for the majority presence in the country." "Mounting expenses, dead stock, no sales, demanding vendors, uncollected payments and mounting expenses -- Covid-19 has been the last nail in the coffin for a host of MSMEs, post demonetization and GST (goods and services tax)." "The Covid-19 crisis has the potential to push around 40 crore (400 million) informal sector workers deeper into poverty" with 90% of workers working in the informal economy. "Domestic remittances, usually from big cities and more affluent areas to India's rural hinterland, plunged about 80%" because of the flight of migrant workers back to their villages. Unlimited problems, increasing poverty. That is the nub.    

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