From Bharatpur to New York, the pandemic is a public health emergency that’s also changing businesses and industries in ways we haven’t seen before. It’s forcing us to confront the fragility of human life and endeavour.
In his unprecedented televised address to the nation on the coronavirus, Prime Minister Narendra Modi was right to say that those who think India will not be affected are wrong and dealing with the pandemic will require a societal effort on an unparalleled scale. Consider the scale of the global public health emergency. The 242,713 confirmed cases worldwide are spread across more than 160 countries – from Fiji and Surinam with one case each to China with over 81,158 confirmed cases, according to WHO. Over 10,000 people have died.
Although India’s current case load of 206 (with four deaths) at the time of writing is relatively low, India has also tested fewer people, primarily relying on screening lakhs of people at airports. With a population of over a billion, India had tested 13,486 people in 72 state run laboratories by March 20. The government is now moving rapidly to expand testing facilities. Yet, to put this in perspective, the US by March 17 had conducted 25,000 tests, Italy 134,000 and South Korea as many as 274,000. Germany in the past few weeks has been testing 150,000 people a week.
Fundamentally, it’s a question of capacity in the healthcare system and we are now at a crucial crossroads in the fight against coronavirus. This is why the PM took to television to effectively state the extent of the problem, outlined that there were no easy solutions, cautioned against any kind of triumphalism or notions of Indian exceptionalism against the virus, and appealed directly to citizens to work on a war footing. India may have no option but to move to mass testing sooner rather than later.
Second, while we deal with the human costs and healthcare challenges over the next few months the economic challenge, in a time of social distancing, may be as severe as well as long term. We’re dealing with not just a health but also an economic emergency. This is particularly so in a country where 93% of employment is in the informal sector. Just think of maids, drivers, tailors, barbers, restaurant waiters or delivery workers – many of whom are looking at joblessness.
As an Economic Times analysis showed this week, the Rs 18 lakh crore tourism industry is expecting direct job losses of 1.2 million; the hotel industry is expecting revenue losses of $1.3-1.5 billion. The restaurant industry which employs over 7 million people is expecting likely job losses of 15-20%. Aviation experts are predicting over Rs 4,000 crore in losses to private carriers and the retail business is expecting about 11 million job losses if the current crisis continues for a few months.
This is one reason why the PM asked all Indians and bosses to see things through a humane lens when taking decisions on layoffs. The government has set up a special Covid-19 task force to examine options for a recovery.
Yet the scale of the disruption is such that while we look at sector specific bailouts, the time has also come to seriously consider a Universal Basic Income and direct cash transfers in the months ahead. From economists like Daniel Susskind at Oxford who is calling for £1,000 per month to every UK citizen as financial relief – to senator Mitt Romney urging the US government to pay $1,000 to each American adult – the debate around UBI is now mainstream in most major economies.
How we go about it can be worked out, but transferring Rs 1,000-2,000 to the bottom half of India’s poor families using the digital infrastructure set up by the JAM trinity, is technically feasible. As Brookings India economist Shamika Ravi has argued, “We are in the midst of a slowdown and we must put fiscal concerns aside to develop a UBI type support for those affected (to stem further decline in demand).”
Kerala chief minister Pinarayi Vijayan has already moved forward in this vein with the state’s Rs 20,000 crore corona relief package, which includes Rs 1,320 crore for providing Rs 1,000 assistance to families not eligible for welfare pensions, two-month welfare pensions in advance, Rs 100 crore for free foodgrains to families in need and Rs 50 crore for subsidised meals at Rs 20.
On the opposite side of the ideological spectrum, UP chief minister Yogi Adityanath is also examining options to compensate daily wage earners for losses due to the coronavirus, by studying the feasibility of transferring money directly through RTGS into their accounts.
The coronavirus has meant that business as usual will no longer be feasible in the next few months. Solutions that would normally take months to debate in more placid times can be pushed through in an emergency. The scale of the disruption is such that the government must try out new approaches as we negotiate the new reality.
DISCLAIMER : Views expressed above are the author’s own.