Covid 19 pandemic has wreaked havoc across the globe which is now biggest challenge for developing nation with large population like India. Now this is the time when there is need to frame urban welfare policy in India, this will make easier for the government to support the workers whose jobs and work have been shut down due to the corona virus. Unfortunately, no such system of social protection has been built till now.
The economic side effects of the corona virus epidemic are now slowly coming to the fore. These side effects have come in the form of disruptions in the supply chain of goods, a steep decline in financial markets and diminishing demand. The Global Organization for Economic Co-operation and Development (OECD) has lowered the forecast for the world's economy to 2.4 percent for the year 2020 (previously it was estimated at a growth rate of 2.9 percent). At the same time, the OECD has also warned that if this global pandemic spreads, the growth rate of the world economy can be reduced to 1.5 percent and it cannot be ruled out. Bloomberg estimates that the outbreak of the Corona virus could cause a $ 2.7 trillion damage to the global economy's output. This loss is equal to India's total gross domestic product (GDP).
However, most of the population of India is still left due to corona virus infection. But, many measures have been taken to prevent this in all cities of India. These include policies such as working at home in many companies, closing schools and colleges, shopping malls, restaurants, gyms and theaters and canceling big events. Due to all kinds of restrictions on traffic, the movement of tourists has also reduced. During the January to March quarter, foreign and domestic tourist arrivals decreased by 67 and 40 percent respectively.
Economic activities have been badly affected due to similar traffic restrictions and social distancing all over the world. And according to a survey conducted by big economists of the World Economic Forum, due to these restrictions, the global economy may slow down. We are already seeing signs of this in China's economy. Where this crisis of corona virus started and where strict restrictions of movement have been in force for the last several months.
Permanent investment declined by 24.5 percent in January-February 2020. Retail sales fell 20.5 percent. And industrial production was down by 13.5 percent. According to an assessment by Dan Wang of the Economic Intelligence Unit, there are indications that due to this epidemic, about 9 million people in China's cities will lose jobs in a year. And the salary of workers can be cut by 30 to 50 percent.
Most of the countries where social distancing has been implemented, are also implementing such policies so as to secure the livelihood of the workers. At the same time, schemes are being implemented to help small businessmen.
These steps include:
Subsidy for salaries for those who have taken leave of home to take care of children (France, Japan and Korea) due to the closure of school. Cash assistance paid to the weaker sections (China and Italy).
Tax exemption to individuals and businessmen (China, Korea, Italy, Germany, Vietnam, USA and Iran) and Subsidizing companies to give sick leave to their employees with salary (UK). This has led to a temporary arrangement of cash for workers and companies, which have had a bad effect on this epidemic. And they can be closed if these conditions are normal.
But, since a large number of workers in India work in the informal sector, it is almost impossible for them to implement such policies. The latest Recurring Labor Survey found that only 47 percent of workers in cities had regular, paid jobs. Even among those who work in the formal sector, 70 percent do not even have fixed contracts. 54 percent do not have the right to paid sick leave and 49 percent do not have social security benefits. The remaining 53 percent of the working people who work in the unorganized sector have no access to the resources of the social security system. These workers, such as - taxi drivers, roadside handlers, small business owners, tourist guides and restaurant workers will be the worst affected by this epidemic. Because the demand for their services will decrease. They do not even have the resources to stay in quarantine or take a day off if they fall ill.
India has taken a quantum leap towards the eradication of poverty. At the same time, several social security measures have also been taken for the poor in India, which gives them employment guarantee (MNREGA). Arranges for their nutrition (PDS). Provides health services for them (PM-JAY) and even arranges basic salary for them (PM-KISAN). But, these schemes are usually implemented by targeting the poor of rural India. And their focus remains on getting help from the poor people living in rural areas.
However, these policies ignore the rapidly growing urban population (at a rate of 2.3 percent per annum). The share of urban population in total population of India was 34 percent in the year 2018 itself. World Bank figures show that the poverty rate in urban Indian population is 14 percent. And in big cities, it is even less i.e. 6 percent. While the number of poor is 25 percent of the population of rural India. However, as poverty is decreasing in India, the share of people in the population who have come from weaker sections and who can come under the purview of poverty line has increased. At present, the share of such people in India's population is about 40 percent, who mostly live in the cities of the country. These people are usually people working in the informal sector, whose income keeps fluctuating. And with constant shaking, they can easily go under the poverty line again.
However, the government is aware that those working in the unorganized sector do not have resources for social protection. However, the steps taken so far to overcome this deficiency have been unsuccessful. Till now, the things that have been focused on through such policies are limited to providing pension to the workers in the unorganized sector. But, most of the workers in the unorganized sector have not taken advantage of this system.
Another such pension scheme, Prime Minister Shram Yogi Man-Dhan (PM-SYM), was announced in the budget presented in July 2019. Statistics available on the website of this scheme show that so far only 43 lakh workers have been associated with this scheme, which is just one percent of the total people working in the unorganized sector. The draft Code on Social Security (2019) was placed before Parliament in December 2019. This draft states that, "Central or state governments can implement such schemes, Those who work in social media platforms or gig economy or are unorganized sector workers, to provide them different benefits such as life insurance and disability insurance protection. 'But, no further details are available. Is provided. NITI Aayog's annual report released in December 2019 states that they are working on one such health insurance scheme, To provide health insurance to those who do not fall within the average definition of poverty, but are just above the poverty line and belong to the disadvantaged class. This section of India's population, its social security Has the financial power to contribute to the measures of. However, during the crisis of a serious health problem, the cost of treatment can become a victim of waste. Because of which this class can again go under the poverty line. A large section of this 'lost middle class' is engaged in the work of unorganized sector and mostly lives in urban areas.
If the policies for the welfare of the urban class were implemented, they would have helped the government to help the people affected by the corona virus epidemic at a rapid pace. Unfortunately, no such security measures have been implemented so far. In such a situation, the current crisis of corona virus epidemic should be seen as a sleep-opening challenge. Because, as the population of cities is increasing The government will have to convert its efforts to eradicate poverty into a strategy for its prevention. Those managing the risk will have to help. For this, the scope of financial inclusion, social insurance and pension arrangements and the availability of health services will have to be broadened. Since the urban population is constantly moving. In this case, more sophisticated means will be required to identify the beneficiaries. And it has to be able to carry the benefits of a scheme from one place to another. Our current lack of preparedness shows how desperately the modernization of India's social protection structure is needed. So that it can meet the needs of the constantly changing working class. And, when there is a delay in this process, then we can make arrangements to deal with such risks.
