The International Labour Organization (ILO), which has described COVID-19 pandemic as the “worst global crisis since World War II”, suggests that the problem could be way bigger for India. With a share of almost 90 per cent of people working in the informal economy, about 400 million workers in the informal economy are at the risk of falling deeper into poverty during the crisis. Current lockdown measures have impacted these workers significantly, forcing them to return to rural areas, it says. A statistical brief released by its office in January 2019, notes that almost 67 per cent of the informal workers in the country belong to poor households.
In Odisha’s Nuapada district, infamous for high rates of distress migration, as many as 3,869 labourers have returned home since India started reporting cases of coronavirus. The district administration says another 15,000 to 20,000 would arrive as soon as the lockdown is over. The survey conducted by ASHA workers shows that most were employed at construction sites or engaged in other petty jobs on a daily wage basis. They are now burden on their families. Till the lockdown was announced, the eight-member family of Loknath Majhi, a daily wage labourer from Kusmal village, used to depend on him and his elder son Manoranjan who worked as a painter in Mumbai and earned a day. Since the coronavirus scare, Manoranjan has returned home to be with his family. The entire family now depends on the government relief package, which Loknath says is not sufficient. “I could not register the names of two of my sons in the ration card due to some problem with their Aadhaar cards. So, we have received ration only for six family members,” says Loknath, adding that their plight is going to compound if the government extends the lockdown.
Amitabh Kundu, fellow at New Delhibased think tank Research and Information System for Developing Countries, uses the latest National Sample Survey of 2007-08 data to argue that 7-7.5
SOME KEY SUGGESTIONS OF THE LETTER WRITTEN BY ABOUT 300 ECONOMISTS, ACADEMICS AND SOCIAL SCIENTISTS TO THE PRIME MINISTER INCLUDE CASH TRANSFER OF `6,000 PER MONTH TO EACH HOUSEHOLD AND 10 KG OF FREE RATIONS PER PERSON PER MONTH
million workers in the country fall in category of those who have daily or weekly arrangement of works. There are another 7 million who get monthly salary but are engaged in informal sector. Then there are the other 7-8 million people who work as vendors; half of them are interstate migrants. They are the ones going to be badly affected despite several statements made at the highest level, says Kundu.
Though the Union government has announced a special fiscal package of lakh crore to help the country’s 800 million poor tide over the pandemic, economistactivist Jean Drèze says the amount “discounting the creative accounting and window-dressing” is just 0.5 per cent of GDP, or less than what the Centre blew on corporate tax cuts last year (see ‘Hunger is spreading’, p29). A recent report by the International Monetary Fund shows the package announced by India is too small compared to packages announced by several other developed and developing economies (see infograph). Economist like Arvind Subramanian says the country needs to release a fiscal package of lakh crore, or 5 per cent of its GDP.
Around 300 economists and academics have recently written to the prime minister, seeking substantial increase in the relief package. A key recommendation is cash transfer of per month to each household and 10 kg of free rations per person per month. The government should take all measures to ensure safe harvesting and post-harvesting activities. Procurement at minimum support price and storage by the Food Corporation of India and state agencies needs to be enhanced to prevent a famine like condition from evolving, states the letter. To ensure that people benefit from the package in time, Nobel laureate Abhijit Banerjee suggests that the government should not try to become clever. It should rather focus on being fast and disbursing relief package to most of the households without thinking whether there is some duplicity or not.