GOVERNMENT MUST PAY ITS BILLS

It was the WHO that asked countries to immediately impose an indefinite lockdown so as “to save lives”. No conscientious leader could have ignored such an admonition, coming as it from the institution tasked with promoting health across the world. Prime Minister Narendra Modi, acting with the speed and thoroughness that has long been a characteristic of his style of functioning, imposed the world’s biggest lockdown ever. While China locked down less than 200 million of its 1.3 billion citizens, India locked down almost the entire population of the country, which is rapidly catching up with China in population. It was clear that such a move would have a devastating impact on the economy, but the Prime Minister reminded the nation that it was at war with the novel coronavirus, and in war sacrifices have to be made. Overall the people of India have responded well to the Great Indian Lockdown, which began on 25 March and is to end today unless further extended. During this period, several businesses have closed, hopefully temporarily. The German giant Siemens operated all its plants across the world despite the Covid-19 pandemic, except for those located in India. Many millions of workers have gone back to the villages they came from, and once factories and worksites open (as hopefully they soon will), many are unlikely to return until the festival season gets over after five months. Production will, therefore, be affected, even after the economy gets reopened. The effect of the lockdown will be felt for years, which was why a suggestion was made in this newspaper that 5% of GDP be set apart as additional expenditure every year for three years so as to assist the economy to regain strength and escape a reduction in growth rates that could have severe consequences for social stability.

In the US, the UK and in many other countries, governments have stepped in to give payments to companies so as to ensure that jobs remain protected, while salaries get paid. In India, this has not been done, and businesses have been told to both ensure jobs not be reduced nor salaries. This is an impossibility in the situation faced as a consequence of the lockdown, not to mention pre-existing headwinds to the economy. In some enterprises, the owners have themselves stepped in to ensure through their personal savings that jobs remained protected. In this newspaper itself, the proprietors have willingly and often resorted to their personal assets in order to ensure that work continues smoothly. However, such a situation should not be allowed to continue. Several businesses, including in the media, are facing a crunch in resources because the amounts due to them by various government agencies remain unpaid for long periods of time, sometimes permanently. Merely repaying outstanding dues would ensure good health in several such units, which is why such a move needs to be given priority by the Finance Minister. Efficiency has been the hallmark of Prime Minister Modi and it would be a welcome mark of efficiency if the pending bills of Central and State agencies got cleared, the latter with the former’s help. Thanks to PM Modi and the bold and decisive steps taken by him to protect lives, far fewer citizens of India have died as a consequence of Covid-19 than in the US, a country with much more resources and far lower population. What is needed is a similar effort to ensure that the economy remains stable, and this can happen only if businesses survive and begin to thrive. An effective way of ensuring this would be for government to set a good example by paying its bills on time.