An autonomous research institute under the Ministry of Finance

 

blog author image
(Co-authored with Lekha Chakraborty and Vidya B. Ramji)
 
The govt’s measures for migrant workers won’t be of much effect. We must consider basic income transfers, otherwise we risk starvation due to indifferent public policy responses
 
Constitutionally, international and inter-state migrations are constitutionally functions of the Union. The extension of the “great lockdown” as a response to the Covid crisis has entailed economic disruption, thereby intensifying the humanitarian crisis of inter-state migrant workers. In the public policy framework of “life versus livelihood”, the central and state governments’ response to the issue of migrants’ plight has dismayed many. The FM asserted that their plight “tugs at her heartstrings”, and later announced that eight crore migrants will be entitled to free rice/wheat and pulses, costing the exchequer Rs 3,500 crore. This is too little, too late, particularly after the PM had apologised for the hardships caused.
 
To make it worse, this “benefit” doled out to alleviate hunger is part of the Rs 20 lakh crore package to revitalise the economy! Apart from this, the migration package of Rs 3.1 lakh crore includes interest rate subvention for MUDRA Shishu loans (Rs 1,500 cr), special credit facility to street vendors (Rs 5,000 cr), rental housing (Rs 5,000 cr), additional Emergency Working Capital (Rs 30,000 cr), and additional credit through Kisan Credit Card (Rs 2 lakh cr). We explain why we find this package offensive to the equity and dignity of India’s teeming migrants.
 
On right to food/life with dignity
 
The People’s Union for Civil Liberties had petitioned the Supreme Court (SC) demanding a legally enforceable right to food, and for converting food and social protection programmes into legal rights. The petitioners asked whether the right to food should be a constitutional right to life, as the hungry poor have little hope of living a dignified life. The SC, in its judgment, expanded the frontiers of fundamental rights. Article 21 guarantees that “No person shall be deprived of his life or personal liberty except according to procedure established by law”. By holding that this right is required to enable a life with dignity, the SC recognises several socio-economic rights (including the right to food, housing, and work) as enforceable rights.
 
The UN establishes that the state has the duty to provision food or the means to buy food to its population wherein the minimum obligation is freedom from hunger. It defines the right in terms of the state’s duty to respect, protect, and fulfil (facilitate and provide) the individual’s right to food.
 
NFSA (2013) guarantees highly subsidised monthly rations of rice, wheat or millets to 75% of rural and 50% of the urban population—around 800 million people subdivided as, Priority (BPL) and Antyodaya households. It also mandates the creation of grievance redress systems for enforcement at national, state, and district levels.
 
On right to food/life with equity
 
The department of food and public distribution is responsible for ensuring food security through procurement, storage, and distribution of food grains, and was allocated over Rs 1.2 lakh crore in the last budget. The department of consumer affairs (allocation of Rs 2,300 cr), is responsible for spreading awareness among consumers about their rights. We can argue how well this was done during the recent crisis—a major concern for migrants, who lack identity documents, and are thus barred from accessing their rights and entitlements under NFSA. The food grain stocks in the central pool stood at 73.85 MMT (April 2020), the highest ever and 3.5 times the minimum operational-cum-strategic reserve requirement. The government did not dispose of stocks as the “economic cost” of procurement is higher than the central issue price. Furthermore, present bumper wheat crop will only add to storage challenges.
 
According to available data, leakages in PDS were estimated to be 46.7%, i.e., 26 MMT of food grains! Leakages happen due to pilferage or damage during transportation, diversion to non-beneficiaries, and exclusion of people entitled to foodgrains, but not on the beneficiary list. Furthermore, post-harvest losses account for 10% of total grains, estimated at Rs 7,000 crore. Amartya Sen argues that democracy is the defence against famine, but “it would be a misapprehension to believe that democracy solves the problem of hunger”.
 
It was not just the lack of food, but the sheer lack of dignity and equity too, “Qu’ils mangent de la brioche” that sparked the French Revolution. All a poor “Oliver” is asking for is not just food, but equity and dignity. That is the least we can do.
 
Given the magnitude of this crisis, it would be apposite to scale up the tranche. In a paper ex-ante to the pandemic, Pinaki Chakraborty and S Garg have analysed the trends in inter-state migration across India and recommended a progressive transfer system, and a developmental fiscal policy stance at the state level to reduce the fiscal pressure of migration (bit.ly/2M543JR). Will the 15th Finance Commission announce Covid grants in their final report in October? The revision of state’s borrowing limit from 3% to 5% announced by the FM is laudable. However, within the 2% revision, only 0.5% is unconditional.
 
Demand stimulation would be difficult in the lockdown period, and necessitates immediate additional transfer of cash, food grains, and other minimum essentials for migrant labourers. We propose “basic income transfers” for at least a few months. Otherwise we risk starvation due to inadequate and indifferent public policy responses. To quote the Mahatma, “poverty is the worst form of violence”.
 
 
Ramji S. Krishnan is Sloan Fellow, London Business School, Lekha Chakraborty is Professor, NIPFP, & Vidya B. Ramji is Senior Public Finance consultant, KRAN. 
 
The views expressed in the post are those of the author only. No responsibility for them should be attributed to NIPFP.
 
This article was published in the Financial Express on May 29, 2020.

 

blog comments powered by Disqus