In Post-Covid world, Home production to sustain India

By Shivaji Sarkar

Ebangla Bureau

An unknown disease, corona, has put the world in lockdown. India is competing with others to force its people at home. Where it fails, the cop becomes the bad boy. No nation rich or poor know how to check it. None ever tried either. 

It is almost a month. People, rulers, administration all want a way out. “Knowledgeable” people like me are asked, “Would it open on April 14? Or tell me when I could go to Vellore for a check-up”.  I can’t disappoint them so tell them, “Do you know the government itself is concerned. They have to open up” But replies of “these experts” do not solve problems. Neither lockdown was easy nor ending it. Despite all pessimism, the nation can remain assured that lockdown is unnatural and nation would open up gradually, in phases from transport to tea gardens to farm goods sell, for survival. Even highway dhabas, the largest consumers of potato have to open up to boost potato cultivators, says Ravindra Kumar Srivastava, one of the biggest Kannauj, UP, potato grower. Panic can put one off for some time but not all. Hope floats from ending of the 76-day-lockdown of the worst corona-hit Wuhan in China. Others are also seeing the disease at a plateau or recovery rates increasing. But caution may be applied here as ICMR points to possible community spread.   The latest RBI assessments are not rosy either for the globe or for home. There are reports that growth may succumb to 1.6 percent predicting not an easy future. But goods and capital globalization started sliding since 61 percent in 2008 to 59 percent in 2018 and is likely to slump further. 

What may be positive for India is revival of domestic production a la late 1970s. It may boost local economy in the next two years. Similarly, many other manufacturing of goods now being imported from China has also to be made here – one reason the latest Chinese imports becoming is vital to create jobs. And this opening up reminds the world of its problems – joblessness, 17 million (1.7 crore) in the US to over 5 crores in India as migrant population is out job and industrial workers remain in uncertainty. The CMIE says it has shot up from 8.7 percent in early March to 23.8 percent by month end. The International Labour Organization (ILO) says India’s urban joblessness is at 31 percent and rural 20 percent – staggering 50 percent. The salaried employees are a mere 10 percent. They also are facing huge wage cuts. It virtually may wipe out India’s seven decades record of poverty alleviation. The ILO says that 40 crore people to slip deeper into poverty with a share of 90 percent of people working in the informal sector. The delivery man, the loaders, vendors, couriers and small earners are all hit That remains an official concern. A new package of at least Rs 75000 crore is being mulled over for the informal sector, MSMEs and the most distressed. The factories are also supposed to open in phases with reduced workforce to maintain physical distancing to keep corona under check. Even IT sector has its problems. About one million in business process management (BPM) are in trouble. Most of them have been benched – an euphemism for not having work. NAASSCOM has sought help for them. It wants government pays 50 percent wages for the benched workers as also bear their provident fund obligations. Not an easy order for the government suffering severe revenue crunch. As hordes of migrants holding H1 B visas are ordered to leave US, the domestic market may see wage drop too. The rural markets have seen it partially during the last two weeks as rural workers return home from cities. That is a problem and may be a solution in the next few years. As imports come down, substitutes have to be manufactured nationally. It may be return of the swadeshi. If it happens it could be Made in India, much more than what Prime Minister Narendra Modi has been trying at Make in India. Experts see the possibility in the post-Covid 19, revival of nationalism as opposed to three decades of globalization. It may reflect first in tourism. The number of international tourists globally touched 1.4 billion in 2018, rising from 900 million in 2008. National governments may weigh risks of infectious/contagious diseases vis a vis free travel and put restrictions. As more workers go back home internationally and nationally, the global finance model, in many cases dependent on remittances is like to have a sea change. Incentivization at home, partially now being seen in India too, may check international or transnational capital flows. The international migrant population that increased to 243 million in 2018 from 190 million a decade back may see sizeable drop as big nations turn protectionist. They have reasons to be. Their economy is at worst, New York governor Andrew Cuomo says that the corona crisis is worse than 9/11 World trade tower attack. Staggering unemployment figures and production losses in the US and Europe would see drop in labour demand, poor finance and structural problems. The lockdown may lead to many lock-outs. Protectionist trends are natural-nationalization may be the global cry. India will have problems as PIO returns as they did after 9/11 and 2008 Lehman crises. It will also bring in opportunities like India emerging global drug supplier in a Gandhian swadeshi in a new jacket. It may not be rigid but strong enough to create a new India, if planned in perspective. Indian transport sector is in difficult situation. As truckers are locked up, essential commodity supplies are drying up raising the prices. Supplies have to smoothen to help the sagging economy. The highways have become source of exploiting irrational tolls. In a flailing global market even as crude hovers around $ 30 a barrel or less (sharp drop from $ 69), to give boost to the sector, the cess and other duties on petroleum must be cut. India also has to realize that 10-year old car junking is not a solution to fight supposed pollution. This is the time people cannot give up their hard-earned lifetime purchases. Empathy in decisions is must. India has to adopt pro-people, pro-society policies. 

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