Will everything be the same once lockdown is over and the threat of COVID-19 recedes? Accustomed as we are to living in our own cocoon, we will like to enjoy the routine as before — immediately on resumption of life or whatever is left of it post-coronavirus. This will help us go back to our well-trodden comfort zone. The expectation from the governments the world over will be to give back that comfort that we all once had. This is the wish of all — from the superrich to the abject poor — since for them coronaviruswill have been a disturbance they wouldn’t want any more.
‘If wishes were horses, beggars would ride’ is a Scottish proverb. No major catastrophe resettles life as before. There always are corrective measures big or small. Judged by the enormity of the cataclysm called the COVID pandemic, the corrective steps must match the enormity of the damage it brought to life across the world. The expectation of going back to the groove once life with news of COVID turns neo-normal is as bright as the proverb.
First take the migrants in large cities who suffered the most due to the lockdown. Living on the edge, these people were dependent on casual and unsecured work, as domestic help, driver, cleaner, electrician, plumber or casual vendors pushing cart full of daily needs. They live a life relatively better than the alternative option of staying back in villages. At least they could earn some extra cash not available to them in the hardly self-sufficient rural economy. Their life came to a grinding halt with no source of income, caught in the claustrophobic single rooms where they used to go back to sleep after work. If we saw an assembly of migrants in Delhi or Mumbai, it was due to this desperation. The lockdown took away their livelihood and exposed them to the devil of a deadly virus and the deep sea of starvation. Will such migrants who managed to go back home return post haste and join the workforce as before?
Second, what about the unfortunate migrants who are struggling to survive in a hostile unfriendly slum, those who assembled at Bandra to go back home and many such people just waiting eagerly to somehow meet their near ones in native places? Will they not try to rush back home the moment there is any transport — train or bus — available? Many of them may not like to stay back and suffer an uncertain future. More so, since the unlocking will not bring in complete normalisation but will come with several restrictions and warnings giving them the feeling that not all is clear and rightly so.
A part of the ‘exodus’ might have been instigated, but that’s a different story altogether.
Life of the economy
It is natural that the gradual process of easing of lives will see reverse migration from the cities and factory townships where migrants who were mere daily labourers or casual workers. It will take some time before normalisation sets in and activity as before resumes. Labour-intensive sectors including services will have a slow restart. That this is not idle prediction was seen when people tried e-commerce sites like Big Basket or Amazon Pantry for daily needs, to get a delivery slot remained a standing joke. Once lockdown is lifted this will take some time to come back to normalcy.
No less important will be the change in demand pattern in the market. It is certain consumers will conserve their resources and wait for the depleted value of their savings to somewhat recoup the losses. Add the salary cut, salary freeze and job cut already announced by some sectors, media for instance, and the likely hit on consumption will be clear. Consumption demand is expected to recover only after a few quarters. Till then consumers will buy only necessities. The slowdown in demand that was quite visible even before Covid19 hit us will continue even at a slower pace. Sentiments will recover with a lag after the market recovers. The message is clear that the market has no immediate reason to get out of a depressing scene.
The effect of this will be felt in lack of jobs which was already pinching the economy. Now in a depressed state those who were earning livelihood as self-employed will find it even more difficult to manage. The huge problem of unemployment will create social tension and delay the economic recovery even further.
As far as the government is concerned, the problem is so complex that only a very carefully laid out plan can revive the economy after about a year or so. Early prediction of sufficient monsoon is a good signal but this must be matched by the support necessary to farmers, for procurement of crops which was delayed due to lock down and also providing liquidity for sowing the monsoon crops. The government has the onerous task of not depriving the farm producers adequate profit at the same time not letting food prices spiral out of hand in, what is certain to be, a liquidity injected economy.
In other words, keeping inflation under control is a critical task. More so to help the middle class who have suffered during the lockdown and are destined to suffer due to loss of future earnings. No less critical is the continuation of health sector investment since the coronavirus has come here to stay. People need vaccination which will take at least 18 months or so to come. Treatment at present is experimental at best. There has to be properly laid down guidelines for treatment.
The government has to invest in health care, spend more than what it was budgeting earlier. Naturally, the government has to balance between two immediate needs — healthcare and public spending to revive a sagging economy. Whether we admit it or not, our lives have entered a dark tunnel which throws no sign of light as of now. If the policies are framed carefully and what is more executed sincerely and without any leakages, India may move back to a seven per cent rate of GDP growth. When the Reserve Bank governor expressed the magic figure for the next fiscal 2021-22 we all loved to agree with him. Only the Scottish proverb makes us worried — if wishes were horses beggars would ride.