Jean Drèze, development economist and social activist, interviewed by Shreehari Paliath (IndiaSpend.com)

Jean Drèze, development economist and social activist, interviewed by Shreehari Paliath (IndiaSpend.com)

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published Published on Jun 28, 2020   modified Modified on Jun 29, 2020

-IndiaSpend.com

Bengaluru: Global economic output is expected to contract by 4.9% in 2020 owing to the COVID-19 lockdown. India announced a lockdown on March 24, 2020, which was extended over two months, and continues in pockets of states depending on the spread of the disease, which has now infected more than half a million people in the country.

The lockdown impacted millions of inter-state migrant workers who form the bulwark of India’s economy, many of whom have been forced to return home to their villages in poor and less developed states, to face an uncertain future. On May 13, the government announced a Rs 20-lakh-crore ($266 billion) stimulus package to revive the economy and its various sectors. But “what we need is not just a stimulus but also immediate relief for vulnerable households”, said Jean Drèze, development economist and social activist, in an interview with IndiaSpend. Putting money in the hands of poor people facilitates the revival of the economy by fortifying consumer demand, and helps to tilt the composition of the gross domestic product (GDP) towards goods and services that are consumed by the working class, he added.

There is “much talk of reopening the economy, but reopening public services is no less important”, said Drèze, suggesting that the government needs to put more food or cash in the hands of the poor, and emphasised the “need for more enlightened health policies”.

Drèze is one of the architects of the rural jobs programme or the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), and a visiting professor at Ranchi University. He has taught at the London School of Economics and the Delhi School of Economics, and authored ‘Sense And Solidarity - Jholawala Economics for Everyone’. With Nobel laureate Amartya Sen, he has co-authored ‘Hunger and Public Action’ and ‘An Uncertain Glory: India and Its Contradictions’.

In an interview, he suggested solutions to improve social security in India, the challenges to public distribution system and portability, and the country’s economy before and during COVID-19.

Edited excerpts:

* India faced a slowing economy and high unemployment even before the pandemic including a 26-quarter low in GDP growth. Simultaneously, there were anti-CAA/NRC protests and riots. How would you describe the last year economically, and how have our institutions responded? How has our welfare system (healthcare, pensions, public distribution system etc.) coped during this time?

The events you mention, and the COVID-19 crisis and the lockdown that followed, have created multiple insecurities for people. There were, of course, many insecurities in the first place, from illness to displacement and crop failures. It is this pervasive uncertainty that creates the need for a strong social security system, in other words, for helping each other in times of crisis. This is nothing new, it is a well-accepted objective of public policy in most democratic societies, except in a few countries such as the US where the poor are largely left to their own devices, with disastrous consequences. Unfortunately, the idea that India needs a social security system is often greeted with cynicism, reflected in disparaging terms such as mai-baap sarkar [paternalistic state] and nanny state. One lesson of the current crisis is that it is time to shed this cynicism.

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Image Courtesy: IndiaSpend.com/ Yasir Iqbal


IndiaSpend.com, 28 June, 2020, https://www.indiaspend.com/reopening-public-services-is-as-important-as-reopening-the-economy/


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