The unique thing about Covid-19, keeping in mind the patient zeroes, is that the carriers have had a foreign travel history. Considering the profile, the travellers belong to a relatively better socio-economic background. The very fact that they are getting affected en masse has awakened the authorities. But, in India, other epidemics such as cholera, malaria, and tuberculosis have a disproportionately higher number of people getting affected from the low-income group, and yet they never make it to the status of pandemic. For instance, every year 2.69 million people get affected by tuberculosis (includes HIV + TB), 15 million from malaria, and 4 million from cholera. Even the media attention has been fleeting and not as frenzied as Covid-19.

What is more disturbing is that the mass working class, and their family members are more vulnerable to these diseases with death count much higher than Covid-19. In fact, the authors had a tough time to get recent figures for the number of people getting affected by tuberculosis, malaria, and cholera, in contrast to the number of people affected from Covid-19, which is tracked every hour.

An average middle-class Indian earns around INR2,60,000 per annum. Only 6% of the Indians earn more than that, and to get into the top 1% income-earning bracket, you need to make over Rs 15,00,000 per annum. The average national income is around INR1,45,000 per annum. However, considering the distribution of income, 80% of the Indians earn less than the average per-capita income. And when it comes to the lockdown, it is the livelihood of these people that gets the jolt.

The biggest impact would be on the lives of the bottom 80% of the population. These people are mainly agricultural labourers and the urban informal-sector workers. Their number is 120 million with most of them being migrant workers with a subsistence level of income less than INR400 per day. Most middle, upper-middle, and the rich continue to work from home. A large part of high-end economic activity has been moved or could be easily moved online. There is minimal disruption when it comes to the continuation of work and earning prospects of this class. Of course, some industries such as airlines, tourism, hotel, and other related-service industries are getting affected. The business, although it has slowed down, has not completely stopped.

The richer sections of the population are afraid because money alone cannot solve Covid-19. To them, the first best solution is a complete lockdown. In fact, no one talks about before lockdown, when every day there have been around 625 fatal road accidents in India. So, 21 days of lockdown has saved 13,125 lives.

For the urban informal-sector workers and the agricultural labourers who have left for their hometowns, lockdown means loss of job. As their income is hand to mouth, with zero savings, lockdown can be life-threatening. In fact, the inflationary impact of lockdown is going to hit them the most. The central government’s assurance to frontload Rs 2,000 into the account of the poor will not work as inflation will readjust resource demand. Unscrupulous traders have already started hoarding. For the migrant workers, the only way out is to move to a non-monetary environment, to their own villages. Incidentally, this is a good harvest year. However, with the agricultural supply chain broken and lack of storage facilities, there is a fear that food may get wasted and fuel the next round of inflation.

Here is an ideal solution that policymakers can think about for phase beyond lockdown. At present, there are around 84 districts that are affected, which are mostly urban. Essential services such as food need to be delivered to these districts where some economic activity is still taking place online. Connecting these two spheres is important. This can happen only by making agricultural and food supply-chain more efficient. While the APMC Act was a major hurdle in connecting farmers to the wholesellers and the final consumers, there is also an infrastructure bottleneck. These bottlenecks to a certain extent explain the difference between two measures of inflation – Wholesale Price Index (2.5%) and the Consumer Price Index (6.5%).

The aftermath of the lockdown offers a unique opportunity. Due to lack of other economic activities, and lack of human traffic on roads, railways, and airways, suddenly the infrastructure space has become efficient in terms of goods movement. During normal times, trucks are not allowed to ply in metros during the daytime. In addition to the delivery of goods by trucks and trains, the airlifting of goods and medical equipment can be expanded easily as airlines slots are lying vacant. All this will help in faster movement of goods, and at the same time employing a major part of the informal sector workers.

India’s foreign trade, which has come to a standstill due to unavailability of workers at airport and sea-ports, will also see an uptick in container movements. India has a comparative advantage in high-valued perishable food items like fruits, vegetables, and meats, but a requirement for the seamless movement of goods is a pre-condition.

Suspending administrative rules and legal rules (for example, tweaking the APMC Act, and E-way Bill) through an ordinance will be helpful. Small farmers growing perishable items should be allowed to go and directly sell their products in the urban market. Policing should be done to monitor hygiene and social distancing in these markets, and at the ports and airports. For inter-state movement, it will be prudent to involve big corporates to manage the supply chain. The corporates can make use of these migrant workers, who have skillsets such as driving, speaking and negotiating in vernacular languages.

But to make all these happen, state governments need to take tough calls. Many market aggregators and leaders of worker unions are politically connected and donate generously to the party fund. This has to be a political decision by the government but the benefits are both immediate and long-term. (IPA Service)