Monday, 30th October 2017

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Weakest link: The poorest have been hardest by the lockdown

Way outs include ensuring minimum basic income, efficient management of food distribution and loan waivers

  • Published 24.03.20, 10:49 PM
  • Updated 24.03.20, 10:49 PM
  • 2 mins read
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Police relocate the homeless to safer places in Kozhikode, Tuesday, March 24, 2020. PTI

The Covid-19 pandemic will cause extensive damage to human health. It will take many lives before it subsides, or is brought under control. There will be considerable costs to the global economy too. Production and income losses will be accompanied by severe unemployment in many sectors. The most affected sectors in every country are civil aviation, entertainment, tourism and hotels. There will be slowdown in many other sectors of the economy, such as construction and transportation services. In India, the blow is expected to be severe because the economy was already under stress when the pandemic hit. Already, a large number of daily workers in the informal sector are going back to their villages since urban jobs are shrinking by the day. Lockdowns, like a strike or a bandh, have hit the poorest first and affected them in the worst possible fashion by jeopardizing their daily income. In the absence of a well-functioning social security system, their vulnerability to hunger and disease increases significantly.

During the Spanish flu pandemic of 1918, India lost 6 per cent of its population. In absolute numbers, the estimate was somewhere between 17 and 18 million people. These Indians were mainly poor, rural-based and women. After the flu subsided, there was a poor monsoon and a sharp fall in agricultural output. This led to a steady rise of distress migration to the cities. Not much has changed this time around. There is already widespread agrarian distress. A large number of poor farm families have minimal access to healthcare. With reverse migration from the cities, their exposure to the disease will increase. Healthcare facilities are woefully inadequate for India’s large population. Hence, the possibility of an acute agricultural crisis cannot be ruled out. The adverse effect on daily wage earners and small traders will add to the depth of the crisis. One way out is to ensure some minimum basic income, the efficient management of the distribution of food, or a scheme for loan waivers since many poor people in rural areas are likely to be already tied to microfinance credit. There are two distinguishing features that make India different from many of the other severely affected countries. Given its population, India is arguably the poorest country of the lot with an inadequate public health infrastructure when compared to China, the United States of America, Japan, Iran, Italy and Spain. The second feature is that India has the largest informal sector work force with no social security cover. These will make the challenge of tackling the economic aftermath of the pandemic fearfully difficult.