The entire world is engulfed in the pandemic crisis of COVID 19. There is sense of unprecedented uncertainty towards the survival of the human race. The loss of life is compared to the Spanish flu, WW I and WW II catastrophe. Mankind is searching for a short term and quick solutions to stop the pandemic and to revive the downward trajectory of the economies in the world.
Coming closer home, to India, it is battling not only the corona virus with lockdown but the bigger challenge is to keep the 133.92 crores population in safe zone, coupled with mass exodus of migrant workers who are presently unemployed, social distancing, making essential goods and services available and to feed the large homeless mass.
The government has been kind enough to announce a relief package of $22 billion, (1.70 lakh crore) under the PMGKYfor ‘reaching out to the poorest of the poor’- insurance scheme for health workers, safaikaramcharisetc, The PMGK Anna yojna for the benefit of 80 croreindividuals (2/3 rd of Indian population), benefits to farmers with Rs. 2000 front load payment covering 8.3 crore farmers, PMJDY withRs 20.40 crore, cooking gas cylinders free of cost. Those with income less than Rs 15,000 pm a payment of 24% their monthly wagesthrough PF accounts for the next three months, to the divyangand the list continues. These are more of welfare packages for ‘lives’
What for ‘livelihood’? Is this stimulus package enough? Considering the worst affected countries,they have drawn up a bazooka of funds to their COVID 19 stricken economies, to name a few Germany $613 Billion, US $1 trillion, UK $13.37 billion, Italy $27.86 billion.
The data points for India like the other economies of the world appearsnothing but bleak, something which began as a supply side shock with crippling the demand side. Global activity levels have fallen off the cliff,hauling the world to a situation similar to the Great Depression of 1930s, hence the economic challenges to India is a part of the global spectrum. Howeverthe even more grim picture is - India is a large economy with a large fiscal constraint, larger deficit and an even larger population. What if we follow the ‘printing of currency’? Again this will cause inflation, loss of confidence in currency and long term adjustments. Does this leave India with a caveat of a partial lockdown in sensitive areas and release the lockdown in the other regions of the economy? India needs to follow ‘test’ ‘trace’ and ‘quarantine’, needs to build up medical capacity because the economy while focusing on ‘lives’ it will run out of steam on ‘livelihoods’.
On the economic front another stimulus package from the government like the Singapore model,(a small country with a smaller population and better surplus economy) focusing on job maintenance, job creation, fiscal resource mobilsation, provision of a safety net will be the likely answer to ‘livelihoods’.