People on the banks of the Yamuna River are transferred to a shelter during the lockdown.
Abdul Kareem was forced to leave school and lead a life of odd jobs like repairing bicycles before finally succeeding in lifting his family from absolute misery by transporting goods through Delhi in a mini-truck.
Work and the poor financial security that accompanied it were the first stepping stone to a better life.
All this has now disappeared while India is in economic shock from its prolonged coronavirus lockdown. Mr. Kareem is unemployed and found himself trapped in his Uttar Pradesh village with his wife and two children. Their tiny labor savings of 9,000 rupees a month have been exhausted, and the money he has saved for books and school uniforms is spent.
“I don’t know what the employment situation will be like in Delhi after we return,” said Kareem. “We can’t stay hungry so I’ll do whatever I find.”
It is expected that at least 49 million people around the world will plunge into “extreme poverty” – those living on less than $ 1.90 a day – as a direct result of the economic destruction of the pandemic and India is leading this projection, the World Bank estimating that 12 million of its citizens will be pushed to the margins this year.
According to estimates by the Center for Monitoring Indian Economy, a private sector think tank, some 122 million Indians were forced to quit their jobs last month alone. Daily workers and those employed by small businesses were the most affected. These include hawkers, roadside vendors, workers in the construction industry and many who make a living pushing handcarts and rickshaws.
For Prime Minister Narendra Modi, who came to power in 2014, promising to lift the poorest citizens out of poverty, the fallout from isolation is accompanied by a significant political risk. He won an even larger majority in the second term last year thanks to his government’s popular social programs that directly targeted the poor, such as the supply of cooking gas cylinders, electricity and social housing. The scale and depth of this new economic suffering will only increase the pressure on his government as it strives to get the country’s economy back on track.
“Much of the Indian government’s efforts to reduce poverty over the years could be reversed in a matter of months,” said Ashwajit Singh, managing director of IPE Global, a development consultancy that advises several aid agencies multinationals. Noting that he did not expect the unemployment rate to improve this year, Singh said: “More people could starve than the virus”.
Desperate times
Singh reports United Nations University study that 104 million Indians may fall below World Bank poverty line of $ 3.2 a day for lower middle-income countries . This will bring the proportion of people living in poverty from 60% – or 812 million today, to 68% or 920 million – a situation last seen in the country more than a decade ago, he said. declared.
A World Bank report found that the country had made significant progress and was on the verge of losing its status as a country with the poorest citizens. The impact of PM Modi lockout risks canceling these gains.
The World Bank and CMIE estimates were released in late April and early May respectively. Since then, the situation has only gotten worse, with poignant images of people desperately trying to reach their villages, in crowded buses, on truck platforms and even on foot or by bike dominating media coverage. .
The University of Chicago Booth School of Business’ Rustandy Center for Social Sector Innovation analyzed CMIE unemployment data, collected through surveys covering approximately 5,800 households in 27 states in April.
Daily workers and those employed by small businesses were the most affected.
Researchers found that rural areas were the hardest hit, and economic misery was the result of the closure, rather than the spread of infections in the hinterland. Over 80% of households have experienced a decline in income and many will not survive longer without help, they wrote in a report.
The government has promised cheap credit to farmers, direct money transfers to the poor and easier access to food security programs – but these help people who have documents, which many of the poorest do not. have not. With millions of impoverished people in transit across the country, the food security situation is dire – news reports of people eating heaps of rotten fruit or eating leaves.
A broken economy
The economy was already growing at its slowest pace in over a decade when the virus struck. The lockdown, which went into effect on March 25, hammered it in, dampening trade activity and curbing consumption, pushing the economy to what could be its first full-year contraction in more than four decades. .
This is serious enough to justify the country leaving its lockdown, as it has been doing gradually since May 4, even as its infections increase. India is now the Asian virus hotspot with infections exceeding 151,000 according to data from Johns Hopkins University.
Prime Minister Modi, who has been criticized for the pain inflicted on the poor, said his government would spend $ 265 billion, or about 10% of its GDP, to help Asia’s third economy overcome the fallout from the pandemic . But experts say that only part of these measures are direct fiscal stimulus, and probably less than the total damage to the economy during the foreclosure period.
“What is particularly worrisome is the government’s response,” said Reetika Khera, professor of economics at the Indian Institute of Technology in Delhi. “The epidemic will amplify existing – and already high – inequalities in India.”
However, the economic measures will not start for a while and the industry will probably have a hard time restarting due to the labor leak from industrial centers.
And as the harsh summer progresses, more and more pain settles in the villages which now take care of returning migrant workers.
“There are no factories or industries here, there are only hills,” said Surendra Hadia Damor, who had traveled almost 100 km from Ahmedabad, Gujarat, before a voluntary organization does not take him to his village in the neighboring state of Rajasthan. “We can survive for a month or two and then try to find a job nearby – we’ll see what happens.”
