LOCKDOWN AND BEYOND : a looming Crisis
Dar Javed
first glance, India seems like a coronavirus success story, with its relatively low number of cases compared with the rest of the world. But a closer look reveals a grim reality: It’s likely only months away from a major health crisis.
India's high population density has made it more prone to the covid 19 virus sweeping across the globe. With 650 positive cases so far and thirteen casualties, Prime Minister Narendra Modi ordered 1.3 billion residents to stay home to keep India from sliding into a disaster that could dwarf what China, Italy, Spain and the United States have faced.The spread of the coronavirus and the unplanned lockdowns have created economic havoc in the lives of the millions who are part of the informal sector – not just daily wagers, but also workers of the gig economy. According to the Employment-Unemployment Survey, 2015-’16, over 80% of India’s workforce is employed in the informal sector. One-third are casual labourers. The impact of the lockdown on India's informal sector, which includes many street vendors as well as taxi and auto drivers, will be huge, Kunal Kundu, India economist at Societe Generale, told CNBC. When we talk of aggregate demand, what is important to realize is that 65% to 70% of India's economy is unorganized," he said. "Those are the people who would definitely be more affected, (and) even the small-and-medium enterprises."
Here are a few suggestions on what can be done immediately to deal with this situation.
Cash assistance
The world over, including in India, cash transfers are being advocated as the first line of action. At first glance, they seem like the easiest and quickest option at first glance, but there are some caveats attached to it:
1. Deciding the “base” is not trivial: who gets the cash, and how much? Should it be all workers in the National Rural Employment Guarantee Act scheme? Should they all get the same (irrespective of how much they worked in the past)?
2. The possibility of hoarding and price rise may erode the value of cash.
3. The density of bank branches in rural areas is thin, mass cash transfers will create crowding, which in turn will create risk of community transmission.
4. There is also a largely unacknowledged issue of a mess in the banking system due to the move towards the Aadhaar-Payment Bridge System, which results in rejected payments, diverted payments, and other problems. Recent data from the health ministry suggested that nearly 10% of Direct Benefit Transfers failed due to this payment bridge. Besides this, payments that appear successful on the Direct Benefit Transfer portal get misdirected into other people’s accounts.
5. Cash transfers for NREGA workers: Provide 10 days wages for a job card, in cash or through their bank accounts for the coming three months, without work, due to risk of community transmission. This will amount to approximately Rs 2,000 per month per household for all job card holders(just under 14 crore households). This will cost approximately Rs. 1 lakh crores over three months
6. Work guarantee for NREGA workers for later: In later months, when risk of community transmission subsides, assure them work for at least 20 days per month for those who are willing to work. In any case, 100 days of work on demand is a legal obligation of the Indian government under the NREGA. As other economic activities pick up and the work requirement is reintroduced for NREGA, the numbers will automatically fall. According to nrega.nic.in, currently only 8 crore job cards (out of 14 crore) are “active”.
7. Revert to NEFT payments: For all cash transfer schemes (e.g., pension, NREGA wages, Prime Minister’s Kisan Yojna), avoid Aadhaar-Payment Bridge System because of the problem of rejected and failed payments. As mentioned above, the failure rates are high. Use NEFT instead, as electronic bank transfers are more reliable.
In Kind Assistance
Double Rations: The Central government could utilise the excess stocks to provide double rations to all Priority households and Antyodaya households, for an initial period of three months, to be extended if the emergency continues.
Expand Public Distribution System coverage: Excess stocks can also be used to provide 20 kg per household to “General” cardholders (also called Above Poverty Line in some states) at least at a controlled price (say, Rs 10 per kg). Not all states have this category of cards but those that do can use it.
For advance or free distribution: Some states have announced free distribution for one or two months (e.g., Karnataka) or advance distribution (e.g., Chhattisgarh).
Inclusion of other essentials: The government muster consider provision of soap, dal and oil through the PDS for the coming months.
Urgent health related measures
1. Education, not surveillance: Deter community members from indulging in peer-to-peer surveillance. Instead, educate people regarding the importance of self-isolation.
2. More public education: Launch very widespread messaging regarding washing hands, logic of social/physical distance, not touching their mouth, eyes and nose without washing their hands.
3. Enhanced testing: Let people know what symptoms to watch out for, and at what stage they should approach doctors. Do NOT deter them from approaching doctors for fear of escalating numbers.
4. Free testing: Scale up testing immediately. Tests should be made free, whether they are conducted by the private labs or by government.
5. Mobilise frontline workers for education: Mobilise ASHA workers, Anganwadi workers and helpers, Auxiliary Nurse Midwives to create mass awareness about symptoms, spread and precautions. Enhance their salaries/honorarium, and provide protective gear for them.
6. Public hygiene: Provide hand washing stations across cities, especially at railway stations, bus stations etc. That will send an important message.
7. Nationalise or regulate private health services: Wherever necessary (for example, in the case of protective equipment), the government may consider temporary nationalisation (for instance, Britain’s National Health Service has taken over private hospitals). At the very least, the government must take step to ensure price regulation of these sectors, by taking exemplary and swift action against unscrupulous behaviour (for example, fake testing, inflated pricing of masks, soap, sanitisers....(Scroll.in )
Dar Javed hails from picturesque LOLAB kashmir and can be contacted at darjaveed305@gmail.com
Dar Javed
first glance, India seems like a coronavirus success story, with its relatively low number of cases compared with the rest of the world. But a closer look reveals a grim reality: It’s likely only months away from a major health crisis.
India's high population density has made it more prone to the covid 19 virus sweeping across the globe. With 650 positive cases so far and thirteen casualties, Prime Minister Narendra Modi ordered 1.3 billion residents to stay home to keep India from sliding into a disaster that could dwarf what China, Italy, Spain and the United States have faced.The spread of the coronavirus and the unplanned lockdowns have created economic havoc in the lives of the millions who are part of the informal sector – not just daily wagers, but also workers of the gig economy. According to the Employment-Unemployment Survey, 2015-’16, over 80% of India’s workforce is employed in the informal sector. One-third are casual labourers. The impact of the lockdown on India's informal sector, which includes many street vendors as well as taxi and auto drivers, will be huge, Kunal Kundu, India economist at Societe Generale, told CNBC. When we talk of aggregate demand, what is important to realize is that 65% to 70% of India's economy is unorganized," he said. "Those are the people who would definitely be more affected, (and) even the small-and-medium enterprises."
Here are a few suggestions on what can be done immediately to deal with this situation.
Cash assistance
The world over, including in India, cash transfers are being advocated as the first line of action. At first glance, they seem like the easiest and quickest option at first glance, but there are some caveats attached to it:
1. Deciding the “base” is not trivial: who gets the cash, and how much? Should it be all workers in the National Rural Employment Guarantee Act scheme? Should they all get the same (irrespective of how much they worked in the past)?
2. The possibility of hoarding and price rise may erode the value of cash.
3. The density of bank branches in rural areas is thin, mass cash transfers will create crowding, which in turn will create risk of community transmission.
4. There is also a largely unacknowledged issue of a mess in the banking system due to the move towards the Aadhaar-Payment Bridge System, which results in rejected payments, diverted payments, and other problems. Recent data from the health ministry suggested that nearly 10% of Direct Benefit Transfers failed due to this payment bridge. Besides this, payments that appear successful on the Direct Benefit Transfer portal get misdirected into other people’s accounts.
5. Cash transfers for NREGA workers: Provide 10 days wages for a job card, in cash or through their bank accounts for the coming three months, without work, due to risk of community transmission. This will amount to approximately Rs 2,000 per month per household for all job card holders(just under 14 crore households). This will cost approximately Rs. 1 lakh crores over three months
6. Work guarantee for NREGA workers for later: In later months, when risk of community transmission subsides, assure them work for at least 20 days per month for those who are willing to work. In any case, 100 days of work on demand is a legal obligation of the Indian government under the NREGA. As other economic activities pick up and the work requirement is reintroduced for NREGA, the numbers will automatically fall. According to nrega.nic.in, currently only 8 crore job cards (out of 14 crore) are “active”.
7. Revert to NEFT payments: For all cash transfer schemes (e.g., pension, NREGA wages, Prime Minister’s Kisan Yojna), avoid Aadhaar-Payment Bridge System because of the problem of rejected and failed payments. As mentioned above, the failure rates are high. Use NEFT instead, as electronic bank transfers are more reliable.
In Kind Assistance
Double Rations: The Central government could utilise the excess stocks to provide double rations to all Priority households and Antyodaya households, for an initial period of three months, to be extended if the emergency continues.
Expand Public Distribution System coverage: Excess stocks can also be used to provide 20 kg per household to “General” cardholders (also called Above Poverty Line in some states) at least at a controlled price (say, Rs 10 per kg). Not all states have this category of cards but those that do can use it.
For advance or free distribution: Some states have announced free distribution for one or two months (e.g., Karnataka) or advance distribution (e.g., Chhattisgarh).
Inclusion of other essentials: The government muster consider provision of soap, dal and oil through the PDS for the coming months.
Urgent health related measures
1. Education, not surveillance: Deter community members from indulging in peer-to-peer surveillance. Instead, educate people regarding the importance of self-isolation.
2. More public education: Launch very widespread messaging regarding washing hands, logic of social/physical distance, not touching their mouth, eyes and nose without washing their hands.
3. Enhanced testing: Let people know what symptoms to watch out for, and at what stage they should approach doctors. Do NOT deter them from approaching doctors for fear of escalating numbers.
4. Free testing: Scale up testing immediately. Tests should be made free, whether they are conducted by the private labs or by government.
5. Mobilise frontline workers for education: Mobilise ASHA workers, Anganwadi workers and helpers, Auxiliary Nurse Midwives to create mass awareness about symptoms, spread and precautions. Enhance their salaries/honorarium, and provide protective gear for them.
6. Public hygiene: Provide hand washing stations across cities, especially at railway stations, bus stations etc. That will send an important message.
7. Nationalise or regulate private health services: Wherever necessary (for example, in the case of protective equipment), the government may consider temporary nationalisation (for instance, Britain’s National Health Service has taken over private hospitals). At the very least, the government must take step to ensure price regulation of these sectors, by taking exemplary and swift action against unscrupulous behaviour (for example, fake testing, inflated pricing of masks, soap, sanitisers....(Scroll.in )
Dar Javed hails from picturesque LOLAB kashmir and can be contacted at darjaveed305@gmail.com
Comments
Post a Comment