By Panjab Singh
Novel Corona Virus Disease (COVID-19), not previously identified in humans, has shaken humanity at large, irrespective of the nation being big or small, rich or poor or located in north, south, east or west. In fact, United States of America, ostensibly the mightiest country has seen the highest number of deaths (21,300) till April 13! The health pandemic is likely to last about six months or so, but its fall out and negative impact on economies of all countries is going to last for long, primarily because it has affected all sectors, be it travel, transport, trade, agriculture, services, manufacturing, education, health, poweretc. In other words, the economic and social pandemic is going to long outlast the healthCOVID-19 pandemic. Its impact on the Indian economy, which was trying to get back on the growth trail, will be pushed back.Economic experts have estimated the impact of COVID-19 on Indian economy as a dip ranging anywhere from 7-33 % of its GDP,depending on the number of working days lost (17-67 days respectively). OECD also estimates a 20% loss in GDP for India.
In agriculture we are faced with a unique situation today when both demand and supply have taken a hit. Consumption has been impacted because of many establishments being shut, the pace and nature of life having changed for most people. And markets are receiving around half the supply, especially of perishables like fruits and vegetables due to logistical and lockdown hiccups. Less demand also implies a dip in prices of these products, consequently a lower income for the already strained farmer. The impact of this could be more visible in coming months and seasons when we are confronted with harvest issues with this season’s crop, and sowing issues with the next kharif crops. The government’s concession to allow farmers to harvest their rabi crop during the period of COVID-19 lock down is indeed appreciable – but since the harvest is dependent on migrant labour in high producing states like Punjab and Haryana, there are bound to be snags. In India, where 82% farmers are small and medium with very poor shock absorbing capacity, and 54 per cent of the total labour force is dependent on agriculture and agriculture related activities, harvesting this rabi crops and our preparedness to sow the next kharif crop should be high priority. Prompt procurement of farmers produce at MSP and cash payment will not only help them face the crisis but will also help them successfully sowing the next crop. To help prepare the farmers to sow the next crop, governments should ensure timely provision of seeds, fertilizers, pesticides, machinery and even credits on easy terms. This is important especially for the 82% small and the marginal farmers who may not be able to do it otherwise.
COVID-19 has hit every individual but the most severely hit are the daily wage earners, labourers and migrant workers who are about 45 per cent of the work force. Now that many of these people are back in their native rural places, providing nutrition, followed by some livelihood security in their rural settings should be the top priority short term measure by the governments to prevent deprivation. The most appropriate measure would be to immediately provide them free or highly subsidised food grains, pulses and cooking oil besides cash package to meet their daily essential needs. Governments have been conscious of this, and are trying, but reports from the ground tell us that delivery is not quite satisfactory. Employment generating schemes like MGNREGA and similar food for work schemes should be given higher allocation, and activated as soon as the biological epidemic subsides. State governments will have to play a crucial role in implementing many of these schemes as the Centre can largely provide monetary help. A second round of relief package that is much more in quantum and in spread is critical for meeting the challenge.
Similarly, the small and medium enterprises in the country (SMEs), who are more than 4 crore in number and contribute to nearly 30% of our GDP, but have poor shock absorbing capacity (unlike large corporates) are also in need of some financial package to help tide over this shock. This may call for revisiting financial, and production policies on a case to case basis.
To summarise, to help counter the socio-economic impacts of this pandemic, we need to do the following as immediate steps (i) assist the farmer in harvesting rabi and sowing kharif, apart from food and cash relief wherever required (ii) assist the landless and migrant labour with food and cash relief in the immediate term, and some employment assurance in the medium term (iii) financial and other support to the SMEs.
For the longer term, this calamity should teach us three important lessons for preparedness for the future – as both natural and man-made calamities are likely to occur more frequently from hereon. One, it is our food grain reserve of nearly 55-60 mn tonnes that is giving us some confidence in this hour – how to ensure we can maintain this on a regular basis, in a more decentralised manner, and in a manner that it can assuredly and transparently reach all households, even in the farthest corners of our country during an emergency, is paramount. Two, to develop a comprehensive and transparent system of records of all the people in the country, and a concomitant fair, effective and transparent system of delivery– so that if need be, we can ensure reach to all households, most importantly the vulnerable sections of society, be it via cash transfers, or in kind provision of food and other essentials. Today, even if the government were to want to give all households a minimum monthly cash allowance, there is no system in place to know every household was covered, and none covered more than once, and no way well-meaning citizen groups could monitor such measures. A similar problem of coverage and transparency exists in the current PDS i.e., ration – food delivery system too. And thirdly, this pandemic is crying out to the nation to develop an effective public health delivery system that can truly provide for the last person of this country.
(The author is former Director General, Indian Council of Agricultural Research, and former Vice Chancellor, BHU, Varanasi. He can be reached at [email protected])