Coronavirus Pandemic (COVID-19): Socioeconomic Impact & Analysis
A nuclear warhead which possess the potential to destroy the whole world, has not threatened the human civilisation as much as a small tiny virus has done. The bog is created in the context of “Coronavirus Pandemic (COVID-19): Socioeconomic Impact & Analysis”, to see will India bounce back or face economic recession?
COVID-19 tally in India has crossed over 18000 mark and almost above 23 lakhs in the world. The exponential rise in CoronaVirus case has halted the moment of vehicles, flights, and trains and crippled the whole world economy.
India which announced a nationwide lockdown on 25th March, 2020 for 21 days has extended the lockdown till 3 May due to a sharp increase in the number of cases.
Where the World Bank has already forecasted, in FY-21, India will see growth at 1.5-2.8%. It is India’s worst performance since the era of LPG 1991 due to Corona.
Let’s Look at the Coronavirus Pandemics from Various Dimensions:
- Lockdown and Poor
- India and Health Diplomacy
- Art of China’s legal Politik
- What needs to be done
i) How to make lock down succeed
ii) India needs a robust policy to counter COVID-19
iii) India needs to boost its domestic, technological capabilities in A.I by data.
iv) Future way forward
Lockdown and Poor:
National Lockdown has the most devastating effect on the poor. Reports have emerged where it can be seen that people are waiting in long lines to get food offered from some NGO’s, groups etc.
Situation becomes much weaker when disabled, small children, and women were left behind. The food they get is most of the times insufficient.
Many of them have not eaten more than a couple of meals in the last 3 days.
Migrants workers who work daily have neither food nor work to earn some money to buy food. Their condition became miserable when national lockdown is imposed where they do not even arrive at their native homes where they may sustain their livelihood for a small period.
Increased food rations, cash transfers, shelter and food availability for migrants and poor are the most welcome steps by the Government. But, the crisis of such magnitude demands much more states intervention to secure the future of such vulnerable groups.
An Indian Health diplomacy:
The rise in cases of COVID-19 has raised questions about India’s preparedness to control, suppress or mitigate the pandemic.
Preparedness pertains to the domain of public health identification of cases, healthcare facilities, social distancing and the like.
The second set of preparedness relates to India’s external relation with UN agencies, international NGO business and other transnational actors.
China’s management in this regard (especially with WHO, International media, Foreign Government) shows the value of such response.
Video conference of SAARC leader organized by PM Modi on 15 March is one such step in the above direction as India recognized the importance of public health diplomacy as health issues are no longer domestic issues.
Also as India strives for leadership role in governance to make world institutions fairer, it must pay attention to its management with global agencies and actors.
The World Bank is working with India to mitigate the challenge posed by COVID-19. It has approved USD 1 billion to India, of which the first tranche has already been released to deal with the emergency in the health care sector.
Art of China’s legal Politik:
At the time of rise in COVID-19, many lawyers or activists began to drag China in U.S Court demanding compensation (Under 2005 International Health Regulation). But most governments believe, pursuit of such claims against China is a waste of time.
If Beijing can make WHO toe its line, it can do with institutions also.
After all, China dismissed the International Court of Justice(ICJ) decision of Beijing’s territorial claims on the South China Sea.
Power seems to prevail over law is certainly truer in the context of International Relations.
Beijing was eager to discuss Kashmir since last August but has blocked all suggestions related to Corona crisis in recent days.
Winning legal argument, China has learnt from the history of great power relations. The positive lessons are from U.S. and British hegemony who were not only military and economy power but also unwritten legal tradition that had shaped the world narrative.
China has learnt to deploy international law in pursuit of its larger global goals. It has trained armies of international lawyers who push for new international norms which suits Beijing interests.
India has been at the receiving end in most of the quests such as UNSC permanent seat, NSG membership etc. Delhi even struggled in recent days to counter global interpretation of its domestic actions (eg: CAA, NRC, Kashmir Article 370).
How to make lockdown succeed:
- Protecting Health workers by providing better access to PPE (Personal Protective Equipments). Healthcare Industry leaders should also participate. Providing 50 lakhs health insurance for health care workers is a good gesture and the right step to protect health workers.
- Establishing safe houses:
Safe houses need to be reserved for who test negative, especially if they can not exercise safe social distancing. Quarantine houses should be reserved for those who test positive so that they can safely be monitored.
- Pharmacies will have to ensure the unabated supply of medication to elders. All employees in the unorganized sector should continue to get paycheck mid-day meals should be distributed through public school.
Credit support, 3-months debt moratorium announced by the government are welcome step. But extensive income support through existing government Jan Dhan and Mudra accounts to households and SMEs and temporary tax cuts to larger are some future step which are needed.
The need of hour is to maintain supply chains in agriculture in the time of crisis which requires one market across India. It also requires eradication of legislation like essential commodities Act, building on PM-Kisan and various state-level schemes, subsidies, especially for fertilizers, could be done.
Continuance of lockdown or partial lifting or end of lockdown must be decided purely on the basis of medical grounds(not on economic or other).
India needs to design a robust policy to counter COVID-19:
In designing policy it is important to realise that all interventions to contain pandemic have economic implications. Some people might say, “Saving lives must be prior to the saving Economy”. But people need to understand, these are not two separate things.
A poorly executed policy can damage the economy and this can end up taking more lives than original problems. (eg. Bengal famines occurred not due to food production but due to disruption in supply chain).
When it comes to nuanced policies, we have to be aware, any economy-wide lockdown can disrupt supply chains and cause price to raise and food supplies to vanish with devastating effects.
We can learn from South Korea how to manage the situation.
India needs to boost its domestic technological capabilities in A.I., Big Data Analytics, Life Science and Health Technology in Private Sector (CR Mohan):
Blue Dot (small Canadian Company) was the first company outside China that tracks the origin and transmission of infectious diseases around the world. Blue Dot did this by sifting through massive volumes of news, blogs by individuals including health professionals, flowing out of China. It has medical expertise with advanced data analytics and having leveraging A.I. for business and Policy purposes.
In China, CPC roped big tech companies like Alibaba and Tencent in battle against Virus.
China has turned to well-established, as surveillance system based on facial recognition technologies, sensing technologies to identify people with fever in public places and data from mobile companies to trace people who might be infected and limit the spread of disease.
China has developed health code uses data analytics to identify and assess the risk of every individual in the targeted zone. It is based on travel history and time spent in infected areas which they can access in popular applications to know if they ought to quarantine allowed in public.
Unlike China where data is commended under the government, in the USA, data is held by bog companies. And the US is tweaking its laws to gain access to there data(eg. Access to mobile phone data).
The United Staes of America and China are now competing for development of Vaccines to mastery of new scientific capabilities from A.I. to healthcare technologies.
The current situation demands, India should ramp up its effect to build A.I. Big Data Analytics and life sciences with strong private sector participation which is largely dominated by the Government.
Future way forward of Coronavirus Pandemic COVID-19 due to its Socioeconomic Impact:
Third-tier governance structures like Panchayats, Municipalities must be given vital responsibilities and power during such situations because they can manage the situation better at the local level.
India has never understood that public health is not an expenditure, its an investment. Also, public health has never been in the election or political discourse. So, citizens need to pay attention to it and make it election discourse. So that state can upgrade public health.
Conclusion on Coronavirus Pandemic (COVID-19) and its Socioeconomic Impact:
Due to Corona epidemic solvency risk within the Indian financial system can also arise. Almost 25 % of MSME and small and medium-size-enterprise (SME) loans would slip into default as compared with 6% in the corporate sector (although the rate can be much higher especially in aviation, textiles, power, and construction) and 3% in the retail segment (mainly in personal loans for self-employed workers and small businesses).
Liquidity risk would also need urgent attention as payments begin freezing in the corporate and SME supply chains. Consideration will need to be given to the liquidity needs of banks and nonbanks with stretched liquidity-coverage ratios to ensure depositor confidence.
Where the strong suggestion came from the well-known economics and statistician Dr Subramanian Swamy about the relief package with the comparison of 17 countries and two banks. The Harvard great economist urges Mr Prime Minister of India for an economic relief package to counter the COVID-19 slowdown by writing a letter to him. Dr Swamy also highlights the relief package is pivotal for Indian Economy.
With the relief package, the government should come up with a well-executed plan by which India can press the RESET BUTTON in the post corona age.
The Plans and Suggestions are:
The labours or the workers who are driving the informal economy, Basic Living Stipend should be given by the government, where the money should transfer directly in their accounts. Government can utilize the CESS FUND money to these daily wage workers without hesitation.
Interest-free loans can help small enterprise and shop keepers by which the governments can maintain the Cash flow and liquidity pipeline. It is equally important. To deal and execute with this situation, the GOI can learn from Spain. Spain released and allocated € 100 Billion as a loan guarantee. In this way, the Government can ensure the banks with loan guarantee package. The government need not to spend the whole money to the bank. The only amount which SMEs can not repay, the government will take care of the banks.
The government should wave off the electricity bills to the commercial businesses.
As per the world’s famous business guru and strategist Mr Vivek Binda, partnership with religious institutions like ISKON can help in managing food operations and help to prevent the disruption of food supply chain management.
Finally, we can say, the 2019–20 Corona pandemic has had far-reaching consequences beyond the spread of the disease and efforts to quarantine it. As the epidemic has spread around the globe, concerns have been shifted towards the economic slowdown. Also, there is still a question, how the Indian economy will revive? Will it take a “V-curve”, “U Curve” or will it be stagnant for the long run with the expected GDP growth of 1%?
The time and the corrective & collective efforts by the government and the citizens of India will cover the rest story of Coronavirus Pandemic (COVID-19) and its Socioeconomic Impact.