Thursday 9 April 2020

LOCKDOWN AND THE TWO WORLDS






The developed and the developing world have had very contrasting views on massive lockdown of their cities and states. Even after seeing the Chinese template of disease containment, that is whatever little the Chinese would want us to see, countries like India, Bangladesh, Sri Lanka promptly opted for lockdown but developed nations like the U.S, Italy, Spain, U.K, France and Germany were initially not prepared to do so. The results are getting painfully obvious now as their Corona curve climbed exponentially, overwhelming the advanced healthcare facilities in these nations. So why do you think they failed to act promptly?

While a lockdown along with social distancing, contact tracing, quarantine, washing hands and masking up surely helps in flattening the curve and give countries time to beef up their health infrastructure, it comes at a huge cost. With almost all economic activities suspended jobs are lost at a catastrophic pace and industries stop production and retailing. This compels governments everywhere to make the Hobson's choice between lives and livelihood. But then lives and livelihood cannot remain antagonistic for long - one has to stay alive to earn and if one stops earning how long can he stay alive?

There were many reasons why the government in developed countries did not promptly opt for lockdown.  These are: 

  • Economy could be seriously affected
  • Panic could be accelerated
  • The economic loss incurred by a lockdown could be unbearable
  • Government had to take the economic responsibility of the citizens. In developed nations the government and the organized sector is the employer on most instances.
  • They overestimated themselves on immunity while underestimated the virulence of the virus. They did not believe that it was as strong, contagious and aggressive as it has proved to be eventually.


Now let us try to understand why the developing countries did not take a chance and promptly opted for lockdown:
·         Developing countries learned from measures of China that helped stem this epidemic, as well as from the mistakes of other developed nations that threw them into an uncertain nightmare.
·         Countries like India have huge population 1.3 billion people, a lot of whom are living in densely packed urban slums could easily foresee how deadly and uncontrollable the disease would be once it spread unchecked nationwide.
·         Developing countries spend less than 1% of GDP on health and so while on one hand their health infrastructure is weak and can easily be rattles on the other hand the nutritional status of their people too can leave them easy prey of the virus.
·         Developing countries by nature have and will take less economic responsibility and other accountability for the common people. In India less than 20% work in the organized sector and very few among them are employed by the government. 
·         Countries like, the USA, UK and Spain have announced to pay around 90% of the salary of all public and private wage earners affected by the lockdown. Even if governments in India, Bangladesh etc. pay the wages of the government servants and the organized sector uninterruptedly but what happens to the people employed in the unorganized sector, which is almost 4 times the size?
·         Developed countries have a very effective social security net, which is almost completely absent in developing countries. So disease protection is far economical and hence lockdown makes sense.
The Indian government deserves appreciations for being proactive and addressing the issues of the unorganized sector by direct fund transfer by using its JAM trinity. Food kitchens have opened up in the cities and district administration has been entrusted with the responsibility of ensuring food reaches every mouth. Till now it seems that barring a few exceptions they have as taken the right steps at right time. But the million dollar question that stares us and all developing countries is how long can we afford the lockdown?
In the last three decades our most notable achievement has been large scale poverty eradication. But this new group of approximately 400 million, which has pulled itself out of terrible poverty, does not have deep pockets. Their savings are limited and even a small illness and its treatment can throw them back into the quicksand of hopelessness. Even the best relief measures are no substitute for the jobs they have lost. Then again, the economy cannot be turned on by a switch. It will take time to warm up and start giving dividends. The government will have to do a lot of hand holding to bring it back on rails.

Let us hope that we are able to gradually open the lockdown in a staggered way. Careful data driven easing of restrictions yet maintaining social distancing, avoiding unnecessary outdoor activities, and proper hand hygiene can ensure a phased return of all economic activities. But this will take time.


5 comments:

  1. Very nice analysis of the current situation in foreseeable future.
    Thank you

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  2. Very nice analysis of approaches adopted and the implications

    ReplyDelete
  3. Nice article explains the nitty-gritty of both the world's

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  4. deep insight into prevailing condition

    ReplyDelete