Lives and Livelihoods: The Impact of the Coronavirus on India

Speakers:

Devesh Kapur, Director of Asia Programs and Starr Foundation Professor of South Asian Studies, Johns Hopkins SAIS

Amita Gupta, Deputy Director, Johns Hopkins University Center for Clinical Global Health Education and Professor of Medicine

Nagpurnanand Prabhala, Professor of Finance and Francis J. Carey, Jr. Professor, Johns Hopkins Carey Business School

Moderated by Pravin Krishna, Chung Ju Yung Distinguished Professor of International Economics and Business, Johns Hopkins SAIS

Experts from The Johns Hopkins University joined a discussion to offer insight on how the Indian government has been coping with the Coronavirus and the efforts it has made to protect its population.

Along with China, India's 1.3 billion people are the largest number of people potentially impacted by the Coronavirus in any single country. While India's lockdown measures have been quite stringent and potentially averted a catastrophic outbreak, with nearly 90 percent of people working in the informal economy, about 400 million workers risk falling into poverty if the economy deteriorates further.

Gupta started the discussion by highlighting the Indian government’s early and dramatic approach of public health containment strategy. India is in a heterogenic epidemic where densely populated economic urban powerhouses are not at the peak of the epidemic yet, which is why a strategy of districting has also helped identifying different zones based on number of cases, which would facilitate the reopening of the economy Moreover, Gupta talked about clinical trials concerning the possibility of BCG revaccination which may be playing a role for respiratory infections and may explain why the norther hemisphere, where BCG vaccination is less common, has been more impacted. At the same time, antivirals are being studied such as hydroxychloroquine for which emerging data however does not view it as a promising therapy signifying that there is a need for new therapies as COVID-19 vaccine development may take 1 to 2 years.

Prabhala continued the discussion by discussing the economic and financial sector in India where the RBI has tried to facilitate funding with low interests. The question however is how critical this is because many banks hold far more government securities and cash than they have to hold. Moreover, all this extra money comes with a push for banks to make loans, but India has only recently started dealing with the non-performing assets and the nature of the stress in the financial system is based on reform in the bankruptcy core, making banks less credible in their effort to stimulate growth. India needs to ensure a short-term bailout, whereby the RBI needs to finance the deficit the government needs to incur due to the burden of commercial banks, as well as look at what are its investment opportunities and shovel-ready projects for growth.

Kapur focused on the pressure of protecting livelihoods and food security in low-income countries because of the lack of social protection and the informal labour markets. The detrimental impact of lockdown has been particularly acute for migrant labour. In recent years India has developed a reasonable public distribution system to deliver social services while cash transfer schemes and increased access to bank accounts have facilitated government resource action. However, in respect to agriculture, which is a major part of employment and food security, shortage of migrant labour and maintenance of supply chains has been met with the challenge of ensuring that farmers are paid while keeping public health and social distancing regulations. With falling revenues and escalating demands on public expenditures the, challenge of fiscal deficits may put at further risk the livelihoods for hundreds of millions of people in India.

The conversation concluded with Q&A from the audience.