Edit & Opinion

In India’s Opinion | The Dispatch on 19 May 2020

Every Monday to Saturday, The Dispatch brings to you a selection of Editorials from leading newspapers across the country 

Over to the states

“Devolution of powers to states to micro-manage the pandemic is welcome. They will need to work with local bodies”, suggests the Indian Express Editorial. The Editorial further says, “The guidelines for Lockdown 4, announced by the Union Ministry of Home Affairs on Sunday, continue a trend that began about two weeks ago. The ministry had allowed a range of economic activities in the non-COVID 19 hotspots during Lockdown 3. It has relaxed many more restrictions during the latest phase of the lockdown. Significantly, the guidelines accede to a major demand made by the states during Lockdown 3 — they have been given considerable flexibility in setting the boundaries of the infection zones. Such devolution of decision making is welcome. The states will now have to take care that they open up in a manner that does not aggravate the pandemic, while also addressing economic and humanitarian imperatives” Read full Edit here

 

The new normal is here

Activity is resuming just as cases are surging. “Be careful”, cautions Hindustan Times in its Editorial. “The fourth phase of the lockdown, announced by the government on Sunday, represents a departure from the past three phases. While relaxations were gradually introduced in each phase, India is now substantially opening up. Inter-state travel is allowed; markets — excluding malls — will resume business; there will be more vehicular movement, including of taxi aggregators; more people will now go back to offices; and the everyday rhythm of life, interrupted since March 25, will be restored to some extent. States have been given the authority to demarcate red, orange and green zones, and will have more liberty in determining the extent of activity permitted in them. To be sure, there will be strict control in containment zones, but the big picture in lockdown 4.0 is of an India getting back on its feet.

Here is the paradox. India is opening up on the very day that it neared 100,000 positive cases. Delhi has crossed 10,000 cases, the fourth state to have hit the number after Maharashtra, Tamil Nadu and Gujarat. In the last fortnight, the coronavirus disease also hit 180 additional districts, taking the total affected districts to over 550. Bihar, Jharkhand, West Bengal, Odisha, Madhya Pradesh, Rajasthan and Uttar Pradesh witnessed the sharpest increase in the number of districts — which is primarily being attributed to the return of migrant workers home, who are now testing positive. This is the case at a time when most migrant workers have not yet returned home, or been tested. So with more relaxations and travel, expect a further spike in numbers”. Read full Edit here

 

Government should exit most businesses

“For prosperity’s sake: Government should exit most businesses, focus on public goods like health and education”, said the Times of India Editorial. “The worry that Atmanirbhar Bharat Abhiyan will equal witless public sector expansion and protectionism has been addressed by the government, which is instead planning to limit the role of public sector companies across the economy. An important reason for consistently poor governance delivery in India is that government is overextended. Focussing on public goods like health and education needs it to exit hotels, airlines and the jingbang. With a few strategic exceptions, government has no business to be in business. When it wears all the hats of policy maker, regulator and corporation this amounts to a conflict of interest, which discourages productivity and competition.

Finance minister Nirmala Sitharaman has indicated a new policy whereby PSU presence will be limited to 1-4 entities in the strategic sectors, while in other sectors government will privatise state-run companies. Unfortunately, in a more conducive market, the Modi 1.0 government privatised nothing significant. Its attempt to privatise Air India was half-hearted. However, unleashing the energies and animal spirits of the private sector is going to be the key if Atmanirbhar Abhiyan is to succeed in what one presumes to be its goal – although there is lack of clarity and much ambiguity in this regard – making local products competitive in the global marketplace.

As Singapore’s then deputy Prime Minister Tharman Shanmugaratnam had pointed out at the first of Niti Aayog’s lecture series on transforming India, while the country has under-invested in social and human capital it has overreached in regulating the economy. And sometimes the stepmotherly treatment to private players makes one nation, one regulatory standard a far cry. As if this doesn’t make doing business here hard enough, long-term regulatory stability is also weak. Independent regulators and mitigating policy volatility and incoherence will boost India’s attractiveness in the global ecosystem. Read full Edit here

 

Foggy lens: Mr Goyal’s food for thought

“Hunger has been a persistent — shameful — blot on a nation whose leaders talk of India turning into a five-trillion dollar economy”, says The Telegraph ediorial.
The Union minister of commerce and industry, Piyush Goyal, has announced cheerfully that such has been the focus of the government that not a single Indian citizen has been left wanting for food during the coronavirus pandemic. Perhaps it is time for Mr Goyal and the government to clean their fogged lenses. Two recent surveys conducted during April and May — the months coincided with the Covid-19 pandemic — have found worrying evidence of food-related shortages in India. The survey conducted by seven non-governmental organizations in collaboration with two research bodies across 47 districts in 12 states found, among other things, that one-third of the respondents had no surplus food left, an astonishing 50 per cent had reduced the number of meals while — this is another shocking statistic — 16 per cent had not received food under the public distribution system. Hunger, however, is not the only marker of their economic plight. A large number of families had been reduced to distress selling of possessions, 38 per cent had borrowed from money-lenders, children were being forced to drop out of schools after the lockdown, and two-thirds of households — this was confirmed by the second survey — had lost employment.

The scale of the crisis necessitates urgent mitigatory interventions. It remains to be seen whether the relief measures announced by the finance minister do the trick. If India’s performance in the battle against hunger is to be taken as a yardstick, the latest welfare initiatives would not inspire much confidence. Hunger has been a persistent — shameful — blot on a nation whose leaders talk of India turning into a five-trillion dollar economy. The country ranked 102 out of 117 nations in the Global Hunger Index last year. A combination of factors forces an estimated 19 crore Indians to go to bed on an empty stomach in a land that is, ironically, a food-surplus nation. They include poverty, deepening inequality, rising unemployment and agrarian stress aggravated by climate change as well as glaring leakages and corruption in India’s mammoth public distribution system. Policy, too, suffers from the myopia that appears to have clouded Mr Goyal’s vision. The National Food Security Act has been criticized for ignoring the stability of food supplies in a country vulnerable to extraneous shocks — the pandemic being one example. Food security must be aligned not only with such issues as production and quality but also people’s rights, diverse diets, environmental protection and political action. But these linkages remain invisible to a short-sighted leadership. Read full Edit here

Relief on ground

“Hike in rural employment allocation gratifying”, saiys The Tribune. The Rs 40,000-crore hike in allocation for the rural employment guarantee scheme this fiscal, taking the total allocation to over Rs 1.01 lakh crore, was the need of the hour, promising relief to migrants returning home in their thousands. Excluding the pending dues, spending on the scheme is estimated to be Rs 90,000 crore. The Finance Minister, in the significant final tranche of the stimulus package, also announced that MGNREGS works would continue during the monsoon months as well to address the needs of the returning migrants. April and May have seen a 40-50 per cent drop in work enrolment under the scheme, partially due to the lockdown and lack of job opportunities. The government’s targeted push is bound to provide succor. Read full Edit here

A matter of relief: On the economic stimulus package

Strategy of promoting supply without helping boost demand may force a relook later, observed The Hindu. With the announcement of the final tranche of Atmanirbhar Bharat Abhiyan, the COVID-19 relief package, a pattern to the government’s approach is visible. And that is to give a strong supply-side push by boosting availability of capital on easy terms, keep income and wage support schemes to the minimum, empower constituencies ranging from farmers and workers to businesses, and finally, the most important, keep the damage to the fisc as low as possible. The fiscal impact of the ₹20-lakh crore package is estimated by economists at between 2-3% of GDP and that includes drawals from provisions already made in the Budget for this fiscal. The pillar on which the package rests is liquidity support so that businesses can crank up again and set the economic cycle back in motion. The option of a demand-side stimulus through a resort to deficit financing seems to be reserved for a future date if the infection does not subside or a second wave begins prompting another lockdown. The problem with this approach is that there is a desperate need for demand stimulus now. A strategy to drive consumption by, say, suspending GST for a couple of months or at least cutting rates temporarily, combined with a liquidity boost may have worked better under prevailing conditions. The Centre’s problem is that its revenues are a fraction of what it would have been in a normal situation but even given this handicap, a fiscal stimulus could have been fitted into the overall package. After all, there is something to be said for the strategy of cutting taxes and riding on the ensuing consumption boost that could bring in revenues to compensate for the cut. Read the full Edit here 

 

 

 

 

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