CITIES OF GLOOM
The nationwide lockdown has left the urban poor jobless and on the verge of economic obliteration. How can their lives be brought back on track?
Already on the margins, the disadvantaged in cities stare at economic obliteration. Can their livelihoods be salvaged?
AAlpa Rani, a 40-year-old domestic help living in a 10x10 ft room in a south Delhi slum, looks baffled when asked if she, her husband and their two fully-grown sons are practising social distancing and hand hygiene in the face of the Novel Coronavirus outbreak. “We consider it a blessing if there’s enough water available to wash utensils. Washing hands with soap frequently is out of the question,” says Rani, whose dwelling abuts an open sewer running the length of the slum. It’s a cheek-by-jowl existence with neighbours, mostly migrants from Katihar in Bihar. Late afternoon, men and women escape their cramped spaces to take a nap on the roof, separated by a distance of not even 3 ft. Families share utensils, buckets and towels. They say neither municipal workers nor voluntary organisations have come to provide soap, sanitisers and masks or to disinfect the area.
“I know about the disease, but I have no idea what to do if I get it,” says Rani. Hygiene is her least concern right now. Since the nationwide lockdown kicked in on March 25, most men in the slum, including Rani’s husband, have lost their jobs as daily wagers, auto-rickshaw drivers and delivery boys at local shops. Some women continue to find work as cooks and house helps in nearby colonies, but they aren’t sure how long they can rely on even this meagre income if things don’t go back to ‘normal’ soon.
Across Indian cities and metropolises, thousands of poor families like
Rani’s find themselves bearing the economic brunt of the three-week COVID-19 lockdown that has resulted in widespread job losses in the unorganised sector, wiped out the paltry savings of the poor, leaving them facing a future of hunger and uncertainty. The 2011 Census estimated the country’s urban population at 377.1 million, with about 14 per cent, or 52 million, below the poverty line. It is this segment that needs the government’s helping hand the most to see past the prevailing restrictions—primarily in the form of cash in hand and supplies of food and other essentials.
The Narendra Modi government responded to these concerns on March 26, the second day of the lockdown, with an exhaustive Rs 1.7 lakh crore relief package for the urban and rural poor under the Pradhan Mantri Garib Kalyan Yojana. Some experts, though, found the measures limited in scope and said more funds were needed to meet the stated objectives (see What Needs to Be Done). Much also depends on the time-bound delivery of the benefits, they said. Doubts have also been raised about whether the money will reach the beneficiaries without being pilfered. Nobelwinning economists Abhijit Banerjee and Esther Duflo have said the government should make good use of the ‘JAM’ (Jan Dhan accounts, Aadhaar, Mobile connectivity) infrastructure it has been promoting, to transfer benefits directly to the bank accounts of the poor, with an accompanying electronic receipt.
Let’s examine if, and how far, the urban poor stand to benefit from the Centre’s relief package. While over 200 million women account-holders under the Pradhan Mantri Jan Dhan Yojana have been assured a monthly ex gratia benefit of Rs 500 for the next three months, there are fears that such transfers will cover only a section of the urban poor. “What about the roadside pakoda vendor and his four or five employees who do not have Jan Dhan accounts?” asks Gurcharan Das, author and former CEO of Procter & Gamble India. Or the likes of 29-year-old Asaram, a gardener in Delhi’s Rajokri Pahari, whose monthly earnings have taken a hit due to the lockdown and forced him to dig into his savings (see ‘We have left it to God’). Nobody in Asaram’s six-member family owns a Jan Dhan account and he has never been a beneficiary of any government welfare programme.
Others find the support of
Rs 500 too little. Former Union finance minister P. Chidambaram has said the government should transfer Rs 6,000 at one go into the Jan Dhan accounts. He also suggested that bank accounts be opened for the homeless and Rs 3,000 transferred into each of them. In their action plan laid out for the Indian government, Banerjee and Duflo have called for “much bolder” social transfers schemes. “Without that, the demand crisis will snowball into an economic avalanche, and people will have no choice but to defy orders,” they wrote, terming the government’s offer
ing “small potatoes”.
The relief package provisions for free supply of food grains—five kilos of wheat or rice and a kilo of preferred pulses every month—to some 800 million poor people for the next three months. However, despite a food grainsurplus, India suffers from an inefficient distribution system, and successive governments have failed to revamp the model. That the movement of goods has run into further constraints due to the lockdown diminishes 38-yearold Kamal Khan’s hopes of any food support from the government. A week into the lockdown, the carpenter from Secunderabad, who supports a family of seven, is yet to receive the 12 kilos of rice and Rs 500 in cash announced by the Telangana government (see ‘We will soon have to go hungry’). “Three weeks of such trying conditions without any work is a long time. I wish I could take my family back to Ugwa near Jaisalmer because we will be assured of food there and I will not have to pay the Rs 8,000 rent for my home at a time when I have no earnings,” says Khan.
In neighbouring Maharashtra’s Thane, 35-year-old daily wage labourer Anil Shelke fears he may lose the foodgrain entitlement for his family of five as he does not possess a ration card (see ‘Social isolation is impossible for us’). “Even in the best of times, the PDS (public distribution system) suffers from significant inefficiencies. With added pressure in the prevailing crisis, it will be interesting to see how efficiently the deliveries can take place,” says Santosh Kumar Mehrotra, professor of economics at the Centre for Informal Sector and Labour Studies, Jawaharlal Nehru University, New Delhi.
Chidambaram has called upon the Union government to scale up the food grain entitlement to 10 kilos of wheat or rice in the next 21 days itself, while exploring a home delivery option in light of the prevailing restrictions.
The declaration of the lockdown on
March 24 was followed by guidelines from the Union home ministry that essential services, including PDS and shops dealing with the supply of fruits, vegetables, groceries, dairy products, meat and fish, were exempted. But the lack of a structured response and coordination among the various agencies was glaring as trucks carrying daily food items were not allowed to cross state borders, and the police, unsure of how to enforce the lockdown, are reported to have shut down vegetable and fruit kiosks at many places. The worst affected were the urban poor as they mostly buy essentials on a daily basis. Mehrotra says the sudden job losses and the supply disruptions triggered panic among migrant workers, who feared that hunger would catch them before COVID-19 did. “In their villages, they would at least have some food or the hope of getting work under MGNREGA. The rabi crop harvest could give them a source of earning. The cities offered them no incentive to stay back,” he says.
But leaving for one’s hometown is not an option for Delhi resident
Ramesh Meena. The 60-year-old craftsman, who makes curtains and mattresses, is entrenched in the city’s Khanpur locality, where he lives with his wife in a two-room house in a dingy lane. Meena has been without work for a week and is not hopeful of any income during the remaining period of the lockdown. While his savings can sustain the family for a month or two, a prolonged economic disruption, he says, will force him to seek assistance from relatives and friends. While the Centre’s package mentions an ex gratia payment of Rs 1,000 for some 30 million poor senior citizens, poor widows and poor disabled, Meena does not know what he needs to do to be eligible for it. “The lockdown has turned Delhi’s air so fresh and pollution-free. But to be able to enjoy it, I need food to stay alive,” he jokes.
A large chunk of the urban poor is made up of migrant labour, which powers numerous sectors and services in cities. While the 2011 Census estimated that the country had some 139 million internal migrants (inter and intra-state movement), the 2017 Eco
nomic Survey said nine million people migrated annually from one state to another for work or education. The Union labour ministry does not keep data on migrant workers. However, economic surveys in the past have put them at around 20 per cent of the total workforce. Most of them are employed with the construction sector.
While a report by Invest India, a national investment promotion and facilitation agency, estimates the number of construction workers at 51 million, the welfare fund proposed under the PM Garib Kalyan Yojana targets only 35 million registered construction workers. “We have ensured wages and supply of essentials at our construction sites, but cannot promise such support beyond a specific duration. Though most workers have stayed put, six left,” says Dipankar Mazumdar, partner at Delhi-based architectural firm Enar Consultants. He says the government should have anticipated the migration. “We saw the same trend when construction work stopped in Delhi for two winter months because of the pollution.”
Some experts say that instead of issuing a few hours’ notice, the lockdown could have been planned better. A case in point is South Africa, where a threeday notice was served before a similar clampdown. Did the government then fail to fully anticipate the impact of the lockdown on the lives of the marginalised? “Else, why is the government reacting to situations instead of preempting those,” asks Mehrotra. “The poor are fleeing because the government neither gave them time to prepare nor prior assurance that they would be taken care of. It is not pragmatic to expect them to stay put without livelihood and food security.”
That the lockdown lacked thorough planning is somewhat evident from the home ministry’s regular additions to the list of essential items and services that are being permitted. On March 26, the ministry issued a clarification that the exemptions included ‘animal feed and fodder’ and acknowledged that some states were not allowing the same. On March 27, it issued another addendum about various farming-related goods and services being among essentials. On March 29, the Centre went beyond essential commodities and lifted restrictions on transport of “all goods”. A senior Union government official, however, points to the “uniqueness” of the situation. “It may not have been perfect planning, but this is an extraordinary situation. The world is facing an unprecedented crisis and every country is reacting by considering its own risks and limitations. Look at how even developed countries have faltered,” said the official, on condition of anonymity.
According to the Economic Survey of 2018–19, almost 93 per cent of the country’s total workforce—an estimated 437 million people—is informal. This includes agricultural, construction, manufacturing, sanitation and domestic workers. Although the informal sector contributes to nearly half of the country’s GDP, most of its workers operate in poor conditions and earn paltry wages. According to the Periodic Labour Force Survey 20172018, among casual labourers in the urban areas, men earned Rs 314-335 a day while women earned far less—Rs 186-201— denying them an opportunity to save money. What’s worse is that the measures announced in the relief package, under the PM Garib Kalyan Yojana, may not reach them.
The Centre and several states have asked shops, establishments and other commercial units to continue paying wages to their workers during the lockdown. However, how far it will be adhered to is debatable because such entities are informal in nature and scores
of unorganised sector workers in the states are unregistered. Chidambaram has even urged the government to direct all registered employers to maintain their current levels of employment and wages while assuring them that the wages paid will be reimbursed by the government within 30 days. Also, small-scale shops and establishments generally keep buffer capital for about a week’s expenses in order to pay salaries and make purchases. In which case, the three-week lockdown threatens to severely impact their economic viability. “This package will fail to save millions of small businesses, which might shut down because they do not have holding capacity,” says Das. Calling for lessons to be learnt from demonetisation and the implementation of the Goods and
Services Tax (GST) and urging Union finance minister Nirmala Sitharaman to devise a “small businesses relief programme”, he cautions: “India survives on SMEs (small and mid-size enterprises). If you do not protect them, you cannot protect India. You will face mass unemployment.”
The Congress has asked the Union government to bear 70 per cent of the salary and wage bill of the 42.5 million MSMEs (micro, small & medium enterprises) in the country for the next three months—according to its estimate, to the tune of Rs 1.5 lakh crore. It has also demanded a law forbidding retrenchments in any sector for the next six months.
According to former Reserve Bank of India (RBI) governor Raghuram
Rajan, the immediate need is to ensure that cash reaches the right hands and at the right time. “We need bridges between now and then, for the most vulnerable households in India—for the poor and the migrants. We need ways to get money to them,” Rajan said in an interview to India Today TV. He also emphasised the need to protect firms. “We need to keep firms alive, keep them from closing down if they are viable. That decision is a careful one as we cannot keep every firm alive, given the limited resources.”
While many state governments have also announced measures to protect the urban poor, the need clearly is for these to implemented before it’s too late. As former chief statistician Pronab Sen has warned, “food riots” are a real possibility if the food requirements of the jobless and penniless urban poor and migrant workers are not addressed. “We had food riots during times of famine. We could have food riots again if food is not made available,” Sen said in a recent interview.
Mehrotra seconds the warning and proposes that all stakeholders be roped in to ensure food supply to the disadvantaged on city streets. “The government, NGOs and corporates should come together to feed the poor. With the help of private players, the district administration can keep the supply chain uninterrupted,” he says. Some states are already providing free food to the poor at government shelters. Delhi chief minister Arvind Kejriwal has claimed that his administration is capable of serving two meals a day to about 400,000 people at over 224 night shelters, 325 schools and other locations.
Officials, however, rule out food riots and point to the excess stock of wheat, rice and pulses with the Food Corporation of India, state agencies and the National Agricultural Cooperative Marketing Federation of India. “The challenge, however, is to take this stock to the people who need it. With the government now taking measures to ensure the smooth movement of goods, the situation should soon be under control,” says a senior official.