Crippled without Crutches

Turning a blind eye to India’s moving labour, now set to leave industries immovable?

A global pandemic that has hitherto affected 6,880,373 and claimed 398,754 lives.
The world economy set to witness a predicted drop in output of 3 percent.
And the world battling to inhibit the former and propel the latter.

India too is now well on its way to curb the CoViD-19 outbreak and concurrently brace itself against the coming recession. However, its reprehensible failure to secure a majority of its primary labour force much sooner, has now induced an unprecedented risk to both public health and its economy.

The first CoViD-19 case in India was reported on 30th January when the World Health Organisation’s situation report had already confirmed 7818 cases worldwide. But India remained seemingly unaware of the trade-off between the lack of immediate steps to check the virus transmission and long term effects on its economic growth. Millions were allowed to fly in and out of the country, even when it was already well recognised that international travel had turned an endemic into one of the world’s greatest pandemic. More importantly, no official warnings were issued to the country. Only a few, with access to news on the global picture and some insight into contagion and casualty trajectories, might have understood the approaching disaster.

India kept emphasising the fact that with respect to many other nations, it had both a smaller number of cases and a lower degree of local transmission. And therefore for the sake of a much promised promising economic future, an immediate planned lockdown was postponed. The reality of insufficient testing kits to identify the actual number of those affected, remained unacknowledged. When the first national lockdown was announced on March 24th, to be in effect within 4 hours of the Prime Minister’s address, it seemed that the government was more following the trend for containment than laying the foundations of a well thought out plan of action.

The catastrophe being witnessed today has continually confounded policymakers. As the increasing nCoV transmittances forced stop all manufacturing activities and services, a global supply chain disruption together with the demand contraction, accelerated the onset of a severe financial crisis. But developing countries, with growing markets but also their characteristic unreliable healthcare systems, were doubly hit. India is a labour-intensive economy with 93 percent of its workers self-employed and employed in unorganized sectors, 81 percent informally employed and a conspicuous 139 million constantly on the move. This massive labour force who form the spine of our economy, live majorly without any social protection and mostly on sustenance income. The lockdown hit them hardest with the triad of abrupt unemployment, an incomprehensible contagion and cramped urban slums with no place for essential physical distancing.

The workers who had not been able or known to board the last trains, after the Prime Minister’s announcement, found themselves completely stranded. After a few more days of uncertain transportation, migrant labourers flocked to major train and bus terminals in hope of getting home only to find nothing running and getting flogged by the police. Some migrants boarded buses already overflowing with passengers while others started walking to get back to their own states; along river banks, wilderness and through unused railway tunnels before they could know that state borders had been sealed.

Most of our migrant labour come from the states of Bihar, Jharkhand and West Bengal and work in metropolitans like Delhi, Mumbai and Gujarat. After the shutdown, with little or no guarantee of even basic amenities such as food and water, they had to either stay back in hope of help from aid groups or keep walking to reach home. And all the while chances of increasing transmission of Covid-19 loomed over, either due to lack of sanitation on roads, no personal distancing in transports or no space for social distancing in overcrowded slums. 

The government should have realised the chain effect of a lockdown on sectors like manufacturing and construction, most vulnerable to economic fluctuations, and using the majority of the unskilled, semi-skilled, contractual and migratory labourers. A more farsighted view would have made it clear that however long the stretch of the virus outbreak, the economy would have to pull back up. And that not being possible without these very labourers, industries could have been re-opened with workers in full protective gear, working in shifts, thereby neither disregarding the necessary social distancing measures nor the workers’ right to mere sustenance. The MSMEs could not be expected to take responsibility for their workers in the absence of legal consequences and unforeseeable demand. But steps could have been taken to make workers stay back with a combination of basic amenities, credit by employers and making urban slums a priority for continual CoViD-19 checks and spreading awareness about its effects and protection against it.

Rather, on 29th March, the home ministry made a perfunctory declaration that it was now compulsory for salaries and wages to be paid even during the lockdown. The result? Surveys in Tamil Nadu found 63 percent labourers without wages since before the lockdown. A rapid survey in Gurugram stated that 25 percent of workers in May and 75 percent in April did not get paid. In Gujarat, the diamond industry, which employs nearly 1.5 million workers and all of them migrants, has not been paying them despite government orders.

With no focused or effective action from the central government, workers found their life situation worsening as the abrupt India Lockdown 1.0 was followed by ceaseless extensions leaving millions without income, soon followed by no food, shelter and no foreseeable future without savings or access to credit.

On May 1, after a whole month and a half, the government declared the start of Shramik Special trains to send back labourers to their destinations. And though the nation took a breath of relief, a policy hiccup was plain again. To send migrant labourers back to the very places they had had to move away from in search of  livelihood could not possibly be a sustainable solution. The country’s rural job landscape could not accommodate millions of migrant workers returning home. To make it worse, workers who had been living without the privileges of social distancing or sanitation staples and then travelled in groups over long distances were driven to rural areas which have even more inferior healthcare systems. This had the utmost possibility of endangering those back in villages and make tracking even harder as they spread far and wide. The states who had domiciles returning, first declared that all returnees would be sent into institutional quarantine to check contagion which later had to be changed to 14 days of home quarantine due to lack of capacity. But observation of home quarantine is not of much assurance when there is little awareness and a greater need to earn and feed families. 

A total of 200 Shramik Special trains, ferrying labourers from arrived in the state of Jharkhand till the 22nd of May. With them, those trudging long roads to come back home are trickling in too. Approximately 3 lakh returnees and amongst them only 19,686 tested to date, a mere 6.6 percent with 147 already detected positive. Malda district in West Bengal, formerly a green zone has had a rising number of CoViD-19 positive cases since the arrival of migrants while all those infected in South Dinajpur are those that returned. In Uttar Pradesh, where over 20 lakh workers have come back so far, 20 percent of 245 samples tested positive belonged to migrants in Barabanki while in Basti all 50 new cases were of migrant workers. Bihar, where around 7 lakh migrants have come back in May, 560 were tested positive, and the state has shown the biggest rise since the influx. And the trend goes on and is predicted to spread exponentially as labourers still on their way back, finally return.

With heavy losses weighing industrial houses down, authorities have permitted re-opening of factories now, with safety regulations in place, in orange and green zones along with rural factories. But even when demand can be hoped to slowly return, workers are no more available, resulting in contraction of industrial production and therefore future supply. Since most companies that use informal labour are operated through a chain of contractors and sub-contractors down the line, information asymmetry between principal employers and workers is escalating the bottleneck. But the absolute dependence on migrant workers is now making industries and state governments trying to bring back or retain workers. The diamond polishing and cutting industries in Gujarat are planning to send batches of rough diamonds to local factories near migrant villages once global markets open and exports revive.

Otherwise, the option remains to train locals in jobs that take years to get skilled in. Timely decisions not taken and the epic lack of foresight has now left workers traumatised and impecunious and employers in quandary. But it has also put a toll on an economy already on its knees with the IMF predicting India’s GDP falling to 1.9 percent this year. In addition to costs already to be borne by sectors for fall in demand and production during the lockdown, they will now have to bear the cost of acquiring and then training new labourers in their work. However, a greater cost to the economy is that of human capital as semi-skilled or skilled labourers, now back in villages, try to earn at lesser jobs or go back to farming and disguised unemployment ensues.

This crisis has bared the picture of workers in the lowest rungs of our economy, who hold up crucial sectors and are all but missing when it comes to focused policies and dedicated social infrastructure. The central and state governments sure have announced migrant labourer registration measures and migration commissions to regulate hiring, recently.

But can India get back up on its feet fast enough, without its crutches so mindlessly thrown?

Rhitabrita Mukherjee
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Rhitabrita Mukherjee works with Centre for research on Economics of Climate, Food, Energy and Environment (CECFEE), Economics and Planning Unit, Indian Statistical Institute. She has worked with Centre for WTO Studies, Indian Institute of Foreign Trade also.

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