By Prakash Karat
With the second wave of the Covid-19 infection unfolding, India is facing a calamitous situation. April 4 saw the breeching of the 100,000 mark (one lakh) in daily cases with 103,709 cases recorded. Three days later, on April 7, the count reached the highest so far of 126,260 new cases – the highest daily count in the world. The death rate is also mounting.
To say that the government was unprepared for this surge is an understatement. On the contrary, the Modi government was behaving as if the worst was over in January and confident that the economic recovery was well underway.
Both on the health front and in providing relief to the people during the economic crisis, the Modi government has been grossly negligent. This was reflected in the union budget for 2021-22. The budget had made the fantastic claim of an unprecedented 137 per cent hike in allocations for the health sector when in actual terms the budgetary provision for 2021-22 for the department of health and family welfare shows a 9.6 per cent decrease over the actual expenditure incurred in 2020-21.
The way in which the government has formulated its vaccination policy is also contradictory and confusing. So far two vaccines have been approved for emergency use – AstraZeneca’s Covishield and Bharat Biotech’s Covaxin. While the latter was controversially approved for use as part of the third phase of trials, the regulatory body has still not cleared the Russian vaccine Sputnik V. It is being used in 35 countries but awaits approval for manufacturing by an Indian company.
The supply of vaccine is already falling short with stocks rapidly depleting in states where the surge is most. This is at a time when people above 45 are being vaccinated from April 1. The failure to plan and execute a scaled-up vaccination programme is glaring.
The government should not only see that Sputnik V is put to use immediately but also procure license for production of vaccines like the Johnson & Johnson product which requires only a single dose. The Novavax vaccine to be produced by the Serum Institute in India as Covovax should be expedited. The central government should also immediately provide money for the centrally-sponsored scheme – Aatmanirbhar Swasthya Bharat Yojana – which is meant to develop capacities in primary, secondary and tertiary health system and other public health facilities. Though the scheme is to incur expenditure of Rs 64,180 crores over six years, no allocation was made for it in the budget. This scheme should be immediately operationalised as strengthening the public distribution system should be the priority.
Contrary to the rosy picture projected by the government of a V-shaped economic recovery, it has become evident that growth is halting and can be stalled. The core sector comprising eight segments marked its steepest contraction in six months. Manufacturing output had hit a seven-month low even before the second wave began. Now with restrictions being imposed due to the surge like night curfews, weekend lockdowns and restrictions on movement, economic activities are going to be further dampened. Even though a full lockdown is being avoided, the rising toll in cases and limited restrictions has already affected retail trade, restaurants and hotels in places like Maharashtra. With jobs being axed in the services sector, reverse migration of labour has begun.
The Modi government was singularly callous in addressing the needs of people in distress during the first wave of the pandemic. The fiscal stimulus package announced amounted to hardly 1.5 per cent of GDP in terms of additional expenditure. Unlike the United States, UK and EU countries where substantial cash subsidies were given to citizens, the Modi government gave negligible cash handouts and refused to support small businesses and petty producers. The spectre of lakhs of migrant workers – men, women and children – walking down the highways without food or shelter symbolised the callousness and inhumanity of the government’s response.
The government has to take concrete measures now to meet the impending crisis. The first step is to ensure that every family is provided 35 kg of foodgrains per month, of which 10 kg should be free of cost. Earlier the government had announced provision of 5 kg of rice/wheat and one kg of dal free of cost for 80 crore people who came under the purview of the Food Security Act. However, this was continued till only November 2020.
As of March 1, 2021, India had a huge buffer stock of foodgrains of 9.2 crore tonnes (including un-milled paddy). This is three times more than the mandated buffer. The government should increase the quota of free foodgrains to 10 kg per household per month for at least the next six months.
All the opposition parties had demanded in September 2020, Rs 7,500 cash payment to all families outside the income tax bracket. The government had only given Rs 1,500 in three monthly instalments to women Jan Dhan bank account holders. Given the fact that the pandemic is getting prolonged, the central government should provide a cash subsidy to all families.
With the crisis in employment mounting, the MNREGA scheme should be expanded to ensure at least 200 days work a year with enhanced wages. Till that is done, there has to be sufficient allocations for the wages to be paid for the work-days implemented in the states. The government should immediately announce an Urban Rural Employment Guarantee Scheme which can provide some relief to the urban unemployed.
The Micro, Small and Medium Enterprises (MSME) sector provides employment to eleven crore people. It is this sector which has been severely hit by the pandemic and its fallout. So far, the steps taken have been totally inadequate. The government must ensure, apart from extending the moratorium on loan repayments, waiver of interest on pending loans, subsidy for buying raw materials and other support measures.
All this will involve a much higher level of public expenditure than what has been budgeted for. The government should not rigidly abide by fiscal deficit limits and rely on borrowing for stepping up public expenditure. Further, it should increase taxation on corporates and the super-rich and introduce a wealth tax. This should replace the pernicious reliance on high taxes on petroleum products for garnering revenue.
The central government will do well to aim for the entire country, what the Kerala government has done in two vital spheres. In Kerala, 95 per cent of the people with Covid infection have got free treatment in the public health system. The LDF government has also provided free food kits to 88 lakh families during the entire period of the pandemic. The kit consists of not only cereals but pulses, edible oil and masalas.
The Modi government, instead of focusing on tackling the public health emergency and taking the necessary economic policy measures to shield the people from the economic crisis, has been utilising the crisis to push through neoliberal measures to promote the interests of the corporate and financial oligarchy. The farm laws, the new labour codes and the privatisation drive of public sector enterprises have gone hand-in-hand with toxic communal politics. For the sake of the country, there should be a halt to this pernicious course. The pandemic and the people’s welfare must get the undivided attention of the government. (IPA Service)