Nageshwar Patnaik in Bhubaneswar, April 11, 2020: The Narendra Modi government faces the litmus test as he faces the toughest challenge of his illustrious political career thrown by the Coronavirus pandemic (Covid-19). While saving people from the shackles of the deadly virus must be his top priority, protecting workers in the unorganised sector, farmers, the middle class, persons with disabilities (PWDs) and micro, small and medium enterprises (MSME) will be the key to his popularity and India’s future.

The adverse impact of Covid-19 is so stark that poverty levels in developing countries could be set back by up to 30 years, research released by the United Nations University’s World Institute for Development Economics Research warned on Thursday.

South Asia and sub-Saharan Africa will have the worst impacts where the report estimated 80% of people newly forced into poverty would be located, based on a poverty level of about $ 1.90 (Rs 140) a day and a contraction of 10%.

Many developing countries would suffer because of their informal economies, with many people forced to continue working despite lockdowns or, as in India, having to return to villages where they will have few resources and potentially spread the virus.

Human Rights Watch warned in March that a lockdown in India, where 80% of people work in the informal sector, left tens of thousands of migrants workers stranded, and could worsen hunger and homelessness.

More than 40 crore Indians working in the informal economy risk falling deeper into poverty during the impending crisis, according to the International Labour Organization (ILO). In fact, these workers are most at risk because they are forced to continue working in high-risk environments and often live in cramped accommodation with limited access to sanitation.

Last month, the fear of going hungry sparked an exodus by tens of thousands of migrant workers and their families, many on foot, back to their villages despite lockdown.

The Modi government has announced direct cash transfers and food subsidies to help some 80 crore people already identified. What about the workers in the unorganised sector who are not in the government list? The government is yet to come out with full proof relief relief for these most vulnerable section of society.

Eight major national trade unions in a letter brought to the notice of the Modi-led government the plight of workers in unorganised sector to the central government last week. The letter pointed out that these workers face evictions, food shortages and lack of access to basic facilities.

It is needless to say that those at the bottom such as daily-wage earners, labourers, migrant workers and PWDs must get priority as they are the most affected in terms of economic and social insecurity. The workers in these sectors—salespeople, waiters, hotel boys, groundskeepers, maids, and attendants—have a few things in common.

First, their average monthly wages are less than Rs 6,000. Second, they have no labor protections. Now all of them are without any job and in the absence of unemployment allowance in our country, they virtually live on the mercy of government and few benevolent individuals and social organisations. Third, they can’t do their work from home although the remote work is the only remedy against the virus while the entire country is under lockdown.

Given that the overwhelming majority of our population is currently employed and engaged in the unorganised sector, the government has to work out a sustainable relief plan in the earliest.

Besides, 60 per cent of Indians are engaged and occupied, in some form or the other, with the agricultural sector. The Modi government has little leeway but to prepare a targeted social security programme for the vulnerable farmers and their families.

Incidentally, farmers this year had a rough time. First, they were hampered by unseasonal rains and inclement weather. Adding to their woes, they face shortage of agricultural labourers and transportation facilities. They are at their wits end on harvesting the standing crop. The centre must come out with a concise information on procurement and prices.

PWD persons are the worst sufferers. As 2.2% of India’s population i.e 2.68 crore people, suffer from some form of disability, the Covid-19 only aggravates their existential problem.

The right in the eye of the storm is the middle class. The longer the lockdown continues, economic activity will remain totally halted and the middle class will take the beating. Employers in the private sector have begun slashing salaries and lakhs of mid-level and blue-collar employees have lost their jobs. With lockdown likely to be further extended, this trend will intensify in the near future.

The Modi government has come out with a package offering delayed payment of EMIs, without interest subvention. But this will leads to a greater cost in the long-run. At the same time, it has lowered the rate of interest on all small savings schemes. This has directly hit senior citizens, pensioners, farmers and women especially hard. This is a catch-22 situation for this section of society as the value of the savings goes down sharply. The Modi government must have to come out with a viable plan to secure their interest.

Similarly, medium and small-scale enterprises (MSMEs), which has been recognised by the government as the “backbone of the economy” as MSMEs contribute close to 30% (Rs 61 lakh crore) to the GDP. But the government has not unveiled any plan so far that bails out over 4.2 crore entities that employ several times as many citizens.

The Modi government needs to come out with a holistic plan for protection of the wretched of earth and at the same time must work out a strategy for revival and growth of the economy by coming out with relief measures for the MSME sector, without which the entrepreneurs will be completely devastated.

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