India is in an unprecedented coronavirus emergency lockdown. It is facile to be wise after the event and criticise the decision, and finger-pointing at this juncture can do no good. However, it is necessary to discuss the issues, anticipated or not, which have arisen from the lockdown and which may arise later
The immediate issues at the forefront are, how to alleviate the suffering of hundreds of millions of poor who are undoubted victims of the lockdown, and how to augment the pathetic hospital-bed-equipment-medical system situation. The unprecedented humanitarian crisis may well cause the number of deaths to surpass that due to COVID-19 itself. That is in the darkening future, even as poor people increasingly argue that hunger is a sure slayer while COVID-19 is nowhere as certain, discomfiting the “caring” government.
The lockdown is a body blow to the already slowed-down economy, with damage to the economy yet to be assessed. Dark clouds loom large on the economic horizon, foreboding worse in coming weeks and months. A failed economy inevitably portends social and economic chaos, which must be avoided at all costs. The difficulty is to estimate when the presently failing economy may sink below the point of resuscitation, unless adequate and timely measures are taken to revive it, and what those measures could be.
It is clear, perhaps even undisputable, that the trajectory of the economy, especially since the 1991 New Economic Policy, has been in contravention of the Directive Principles of State Policy, particularly of Art.38(1) & (2), Art.39(b) & (c), and Art.48A.
Specifically, Art.38 says: “The State shall strive to promote the welfare of the people by securing ... a social order in which justice, social, economic and political, shall inform all the institutions of national life” [and] “to minimise inequalities in income ...”
Art.39 says: “The State shall direct its policy [so that] ownership and control of ... resources are distributed to subserve the common good” [and] “the operation of the economic system does not result in concentration of wealth & means of production to the common detriment”.
Art.48A says: “The State shall endeavour to protect and improve the environment and to safeguard the forests and wildlife of the country”.
Successive governments have heeded the voice of the wealthiest and most influential sections of society in preference to the voices coming from the lowest layers of the socio-economic heap. Resultantly, over the years, the Executive and the Legislative have institutionalised injustice, attenuated liberties, enhanced inequality, and in recent years destroyed fraternity, all of which the Judiciary has only partially mitigated in its more independent and fearless moments. The pillars of the Constitution have failed the people.
The economic paradigm of “progress” and “development” continues to be ‘industrialisation at any cost’ in blindly chasing the holy grail of economic growth. It has pushed the majority of people to the economic margins, accentuated economic inequality in an already unequal socio-economic polity, and also destroyed the environment on which the economy itself is founded. Greed-driven violation of the Constitution has occurred precisely because, according to Art.37, the Directive Principles are not justiciable, making successive governments effectively unaccountable to the public. Have I digressed? I think not.
If the preambular principles of justice, liberty, equality and fraternity had not been blatantly abandoned by successive governments over the decades, today’s society would have been more equitable. It would have made the current social-distancing lockdown quite bearable, as it is today for the top 5% of India. But that was not to be. The lockdown-triggered mass exodus from cities and the ensuing humanitarian crisis is evidence.
At this juncture, the government has no alternative other than seeking to relieve the humanitarian crisis by cash handouts and feeding the poor. The better-endowed sections of society are coming forward in support, led by Azim Premji Foundation, Tata Trust and other corporates with huge donations, and RBI has cut the Repo rate, putting more money into circulation. Notwithstanding, if the lockdown is extended or re-imposed after a break, the time is not far when money runs out and government is forced to print more currency to boost money supply. However, production of every kind (especially food) not matching up with money growth due to near-total disruption of supply chains within and between different sectors of the economy, may well lead to uncontrollable inflation, fatal to the economy.
One suggestion is that all government servants and all government pensioners, as also all elected representatives and members of the judiciary who are above a certain still-to-be-determined income level should accept a still-to-be-determined cut in salary/pension for a still-to-be-determined period, so as to release money to handle the emergency. This has been partly done, with a 30% cut in salary for one year for the PM, President and MPs. Further, corporations (not MSME) need to be directed to do likewise. All projects budgeted or in the pipeline which do not address poverty (e.g., the Central Vista re-development in Delhi, statues, etc.), should be shelved to release money.
Tax incentives and exemptions of at least Rs 18 lakh crore given from 2014-15 to 2018-19 as “Revenue foregone” benefitted corporates, and like amounts of public money were spent to rescue NPA-diseased banks, even private banks, when about 4,000 large borrowers account for 90% of NPAs. If corporates had been taxed and NPAs recovered, the correspondingly increased budget for health, education and welfare would have been in satisfaction of Art.38 & Art.39. This policy should be reversed.
The justification for such measures would lie in the logic that these sections have benefited from economic policies which have caused the poverty, and which now necessitate cash handouts and feeding the poor who are driven to destitution by the lockdown.
Resuscitation of the economy may only be possible by adopting change in direction of economic policy so as to be people-oriented, in keeping with the Directive Principles. Only then will there be meaning to the oath on the Constitution that public officials take on assuming office.