📰 China defends WHO, lashes out at U.S. move to withdraw
‘Washington’s decision undermines anti-epidemic efforts, has serious impact on developing countries’
•China on Wednesday defended the World Health Organization (WHO) and lashed out at the U.S. decision to withdraw from the UN body.
•Foreign Ministry spokesperson Zhao Lijian said the move was “another demonstration of the U.S. pursuing unilateralism, withdrawing from groups and breaking contracts”.
•WHO is “the most authoritative and professional international institution in the field of global public health security,” Mr. Zhao said at a daily briefing.
•The U.S. departure from the organisation “undermines the international anti-epidemic efforts, and in particular has a serious negative impact on developing countries in urgent need of international support,” Mr. Zhao said.
•The Trump administration formally notified the UN on Monday of its withdrawal from WHO, although the pull-out won’t take effect until next year. That means it could be reversed by a new administration or if circumstances change.
U.S. President’s criticism
•President Donald Trump has harshly criticised WHO over its response to the pandemic and accused it of bowing to Chinese influence. Mr. Trump said in a White House announcement that Chinese officials “ignored” their reporting obligations to WHO and pressured the organisation to mislead the public about an outbreak that has now killed more than 1,30,000 Americans.
•The move was immediately assailed by health officials and critics of the administration, including numerous Democrats who said it would cost the U.S. influence in the global arena while undermining an important institution that is leading vaccine development efforts and drug trials to address the pandemic.
•The withdrawal notice was sent to UN Secretary-General Antonio Guterres on Monday and will take effect in a year, on July 6, 2021.
•The U.S. is WHO’s largest donor and provides it with more than $450 million per year, but owes about $200 million in current and past dues. Those financial obligations must be met before a U.S. withdrawal can be finalised.
Raises human rights violations, minority issues
•United Nations Special Rapporteurs have made public their third communication forwarded to India since the August 5, 2019, decision to revoke Jammu and Kashmir’s special status, expressing “grave concern over alleged excessive use of force, ill-treatment during arrests and detentions”.
•Four rapporteurs had forwarded a joint communication to India on May 4, 2020 — on torture and other cruel, inhuman or degrading treatment or punishment; on extra-judicial, summary or arbitrary executions; on minority issues; and on freedom of religion or belief — and made it public recently, after 60 days of response time.
•“We would like to bring to the attention of Your Excellency’s Government information we have received concerning the continued deterioration of human rights conditions in J&K following severe restrictions imposed after August 5, 2019, in particular, citing arbitrary detentions, violations to the prohibition of torture and ill-treatment and rights of persons belonging to minorities,” it reads. The first communication was forwarded on August 16, 2019, on “restrictions on freedom of expression and freedom of peaceful assembly”. The second was communicated on February 27, 2020, on alleged “mass crackdown targeting those expressing dissent against the decision taken”.
•“We regret that no response has been received to either communication, in particular, the former.,” it added.
📰 A case for extension
MGNREGS is important in the rescueof the poor during a time of distress
•The finding that 8.4 lakh poor households have completed at least 80 days of the 100-day limit for work under the MGNREGS and 1.4 lakh among those have completed the full quota, should come as no surprise. While these numbers are a fraction of the 4.6 crore households which have benefited from MGNREGS this year, the fact that many poor households have nearly completed their full quota of employment under the scheme in just the last two months (May-June 2020) is a reflection of the distress that has driven them to take recourse to it. With the economy reeling after extended lockdowns following the COVID-19 pandemic and migrant labourers losing jobs in urban areas and returning to their rural homes to avoid destitution, the scheme has come as a huge relief to poor families. The government’s decision to extend it into the monsoon season has also benefited households. Data from this year show that in nearly two-thirds of the States, demand for MGNREGS work has doubled or even tripled in a number of districts compared to the previous year. Only in States where kharif crop was sown, the demand was relatively lower. But with some States resorting to their own shutdowns to curtail the spread of COVID-19, the prospects of a robust economic recovery that would benefit those engaged in casual labour and daily wage-labour remain dim. The fairly good monsoon this season should help with providing for more agricultural jobs beyond the MGNREGS works as well, but the surging rate of demand for work under the scheme suggests that it is time the government thought about extending the limit, at least on a State-by-State basis. The swell in agrarian employment in the monsoon season notwithstanding, the excess supply of labour owing to reverse migration from the cities could depress wages. This makes an extension of the limit of work days under the MGNREGS even more imperative.
•Since its implementation over a decade ago, the scheme has acted as insurance for rural dwellers during crop failures and agrarian crises. But the Centre’s outlook towards it continues to limit it only as a “fall-back” option for the poor. Even before the COVID-19-induced crisis, a lack of demand and falling consumption among the poor were constraining the economy. The MGNREGS, if utilised as more than just an insurance scheme and as a vehicle for rural development, could potentially address that problem. The lessons from its successes and failures could be used for a more comprehensive job guarantee plan that covers urban India too. Besides alleviating distress, this could also boost consumption and aid economic recovery. An extension of the 100-day limit and comprehensive implementation of the scheme in rural areas can be the first step.
📰 The social contract needs to be rewritten
The pandemic crisis can be overcome only when a state is sensitive, has decentralised steps and ensures empowerment
•The novel coronavirus pandemic has affected the lives of many and its catastrophic impact goes far beyond the disease itself. Governments across the world have dealt with the problem in different ways. We do not intend to criticise the lockdown or any governmental actions or inactions in this piece. Posterity will judge how good or how bad any government performed in 2020 on this count.
Finding cause
•The world does not seem to have answers to many of the problems thrown up by the epidemic, especially those faced by the poorest of the poor. No doubt, some small countries have claimed victory in containing the impact of the disease, but their claim appears to be hollow and even myopic; the fact is that these countries are affluent, and have sealed their boundaries.
•So, is the pandemic’s impact the result of the failure of individual governments? Or is it due to the failure of the bipolar ruler-and-ruled dynamic of governance structures across the world?
•There is a view that mankind’s ancestors, in the course of evolution, formed the concept of social groups and resultant rules they would abide by. This is the most rudimentary form of what is known as the ‘social contract theory’. When monarchies and empires prevailed, it was easy to understand a social contract — to obey an identifiable sovereign, who in turn was deemed to be god’s representative on earth.
•But democratically elected governments have found it more difficult to derive the same legitimacy. With the growth of fundamental freedoms, such as those of speech and expression, unquestioning obedience to governmental authority began to fade. Unquestioned obedience is the holy grail of every autocrat. Some governments yearn for it. Modern society and modern governments also use the social contract theory to claim legitimacy for their actions, but rely more on the theory as expounded by Hobbes and Rousseau. While Hobbes believed that man, in Nature, was “solitary, nasty and brutish”, for Rousseau, man, in Nature was “born free”.
•However, both agreed that the social contract comprises two distinct agreements; first, people agreed to establish society by collectively and reciprocally renouncing the rights they had against one another in unbridled nature and second, they agreed to confer upon one (or more) among them, the authority and power to enforce the initial contract. Thus, the social contract comprises people agreeing to live as one under common laws and in enforcing those common laws justly. Modern day governments take this further. Their fundamental credo is that society is best-served if a government or other type of institution takes on executive or sovereign power, with the consent of the people.
Consolidating power
•We have seen governments go still further and use the power democratically invested in them to decide what is in the best interest of the people. Thus, there is a bending of individual free will towards the collective will. Ironically most such leaders constantly invoke “the will of the people” when consolidating executive power. So, the social contract is being used by modern governments to justify greater aggrandisement of power in the hands of the sovereign, under the garb of “public good”. In fact, if the world events that occurred in 2018-19 were to be examined later by future historians, they would be excused for having an image that people across the world had voluntarily surrendered their individual rights to their governments, who exercised these powers with discipline and benevolence.
The case of two Indias
•The novel coronavirus pandemic has laid bare the falsity of this image. For example, access to information about this pandemic has not been equal. The access to resources to avoid the disease has not been equal. And, of course, access to treatment has not been equal.
•There are two Indias. The first is an India that observes social distancing, buys its groceries and provisions by observing all precautions and largely obeys governmental directives about COVID-19 prevention. The second is an India that crowds railway terminals to travel long distances, sometimes for days, to get back to native towns, and when that fails, decides to resort to the drastic step of even walking those hundreds of kilometres, defying all governmental directives. It is for the second India that the impact of COVID-19 has hit hardest and the impact has nearly nothing to do with the disease.
•“Social distancing” was a stirring phrase and call that those of us who are privileged responded to with gusto. We wore our face masks and went about our actions, taking the changed world in our stride.
•But there were the others: lakhs of Indians less privileged and living cheek by jowl in hovels and slums, for whom the mandated distance of separation of “6 feet” was and still is an impossibility; an abstract concept.
•It is often said that “we are all in this together”. But hardly so. We are not sharing the brunt of the pandemic with the poorest of India, the voiceless millions. Professor H.L.A. Hart once said, “freedom (the absence of coercion) can be valueless to those victims of unrestricted competition too poor to make use of it; so it will be pedantic to point out to them that though starving they are free”.
•The pandemic-caused crisis has shone a light on how governmental methods to deal with a crisis largely come to the aid of only those with a voice. All societies have some measure of inequality. However, in deeply unequal societies (where the Gini Coefficient exceeds 0.4, for instance) different strata of society will have very different needs to deal with a crisis of this nature. We have seen societies with lower Gini Coefficients deal with the crisis far better, because a uniform approach works perfectly when society is perfectly equal.
For those in governance
•In moments of crisis, people look to the state for guidance and taking them to safety. This has led to some sections of society seeking a strong response from a strong leader. Unfortunately, when the source of power in an unequal society is centralised, the response to the crisis will result in unequal relief to different strata of society. The more unequal the society, the more decentralised the response should be.
•The social contract which imbues a centralised sovereign with overreaching powers has clearly failed on this occasion, and will continue to fail every time a similar challenge is posed. The centralised sovereign will work well against a mighty external aggressor, but not against a microscopic pathogen.
•What is required is not just a decentralised approach but also a state which is sensitive and responds not only to the needs of those who cry out for help but also meets the requirements of those who are voiceless. Thomas Hobbes described the mighty state as a “Leviathan” which would rule by the will of the majority. He argued that once a ruler is chosen, citizens lose all rights except those the ruler may find it expedient to grant. While no elected government would publicly espouse such a position, it is the unwritten premise underlying every rule and diktat which is issued.
•As seen above, a Leviathan has its uses, as for example, in times of war or in a fight against terrorism. The novel coronavirus cannot be defeated by a Leviathan. COVID-19 can only be defeated by an empowered populace. The social contract requires to be rewritten. It does not require anything drastic such as a revolution or anarchy. Rather, it only needs fundamental introspection and rethinking by the governing classes including bureaucrats.
📰 Joblessness and opportunity in Tamil Nadu
The longer-term decline in the labour participation rate can be attributed to a host of factors
•The COVID-19 pandemic has disrupted economies across the world and presented policymakers with the unenviable task of sustaining employment amidst lockdowns. However, the academic and political debates in India on unemployment, which is widely attributed to jobless growth amidst stagnation in the agricultural and manufacturing sectors, predate the pandemic. It will be useful to locate the disruption caused by the pandemic on a larger canvas so as to enable a comparative assessment vis-à-vis other recent economic shocks such as demonetisation and the introduction of the Goods and Services Tax (GST).
•It would also be instructive to compare Tamil Nadu, one of India’s most industrialised States and also one of the worst pandemic-hit States, with other States that have a large manufacturing sector and are net recipients of migrants. In the absence of government data on employment for recent years, we rely on the Centre for Monitoring Indian Economy (CMIE) even though its employment data series is relatively new. Further, the reach of CMIE’s surveys was restricted by the lockdown, which affects comparison of the data for the recent months with the pre-COVID-19 period.
Trends in Tamil Nadu
•Tamil Nadu’s unemployment rate, which is computed as the number of unemployed persons “who are willing to work and are actively looking for a job expressed as a percent of the labour force”, increased sharply during the strict lockdown in late March and April 2020 but registered a large turnaround in May when the lockdown was eased to some extent. However, the labour participation rate (LPR) continued to decline, even though at a slower rate in May. While the easing of lockdown restrictions has allowed workers to return to work, they are either still hesitant due to the fear of disease or are unable to return due to transport and communications bottlenecks and lack of information.
•The CMIE data do not reveal any clear trend vis-à-vis caste and religion. However, the drop in unemployment rate in May was faster in urban areas and among males. Likewise, the decline in LPR was less in urban areas, among males and among those with higher education. Persons with intermediate levels of schooling were affected more than college graduates as their LPR continued to drop in May. If the level of education can be treated as a proxy for skill, the data seem to suggest that the lockdown has affected the semi-skilled workforce more than the skilled and unskilled workforce.
•The CMIE data also suggest that at least since January 2016 there has been a steady decline in Tamil Nadu’s LPR, where the labour force used as the base to calculate employment indicators includes persons aged 15 years and above and falling into either of the two categories: (a) employed and (b) unemployed and willing to work and actively looking for a job. Demonetisation did not significantly impact either the rural or the urban LPR. On the other hand, GST had a significant negative effect on urban LPR. The immediate effect of COVID-19 and the lockdown is visible through a significant decline in LPR in both the rural and urban sector.
Comparing industrialised States
•Tamil Nadu differs from other south Indian and industrialised States with regard to the trend of LPR. Urban Tamil Nadu compares with urban Gujarat and Maharashtra insofar as its LPR continued to fall in May. Not coincidentally, like Gujarat and Maharashtra, Tamil Nadu boasts of a large manufacturing sector and these States are among the top four COVID-19-affected States. It is noteworthy, though, that while the urban unemployment rate dropped sharply in May in Tamil Nadu, it continued to rise in Gujarat and Maharashtra. It bears emphasising that the States with low unemployment rates are not necessarily better off if their LPR has dropped sharply. Software/new economy hubs such as Karnataka and Telangana have not seen a very sharp decline in LPR; in fact, Karnataka has seen an increase. In most States, rural labour participation picked up probably due to harvest-related activities, the lower incidence of COVID-19 and the return of urban migrants. However, rural Tamil Nadu saw a decline in labour participation in both April and May.
Challenges facing TN industries
•The longer-term decline in LPR in Tamil Nadu could be attributed to general economic shocks such as demonetisation and the introduction of GST, on the one hand, and a combination of industry-specific issues such as changing tastes, a tightening regulatory environment, and growing international competition, on the other.
•The firecracker industry in Sivakasi exemplifies the multidimensional character of challenges, which transcend sporadic shocks. The town that accounts for 90% of the fireworks production in the country faces at least three challenges. First, it has been hit by campaigns calling for the boycott of polluting industries and products. Second, it faces major challenges due to the change in the regulatory environment such as a ban on barium nitrate in the manufacture of firecrackers. Third, the fireworks industry also faces competition from illegal import of cheaper fireworks from China. Other industrial clusters in the Tiruppur, Erode and Karur belt as well as the Ranipet and Vellore belts face similar challenges.
•The answer to environmental challenges is not a complete shutdown of MSMEs, which is counterproductive. The governments and courts ought to keep unpleasant but unavoidable trade-offs and inter-linkages in mind. The closure of tanneries in Dindigul is a case in point. The impact of the ban on the local economy and environment is illustrative of one-sided solutions: a double whammy of lost employment and unresolved environmental damage. The government could have explored possible mitigation strategies, much before the point of no return, to save both.
•While the overall economic scenario is bleak, the present crisis perhaps has a silver lining. The pandemic has exposed India’s unsustainable dependence on other countries for a variety of goods and nudged the government to help build supply chains for critical products that are less dependent on foreign countries. Further, the unfortunate border clash in Ladakh has hardened the popular resolve to boycott Chinese goods. These developments may as well offer the much-needed breathing space to domestic industries battered by a series of economic shocks. States that can adapt quickly to shifting economic currents will recover faster.
