Impact of Pandemic and Lockdown on Migrant Labours and MSMEs: Some Thoughts

for Solutions

As on June 4, 2020, the pandemic arising out of COVID 19, has affected 213 countries
globally with a a total of 65.40 lakhs confirmed cases and a death toll of 3.86 lakhs. In
India number of affected people is 2.17 lakhs and no. of deaths running to 6000.

The pandemic wrecked havoc on global economy and trade, including disruption of health-
care systems, closure of business and industry, tourism and transportation.

In India the pandemic that took off from late March, 2020 has been rising at a phenomenal
rate with no sign of abating. Governments at the Center and the States are facing uphill
tasks to contain the virus. Demands for hospital seats (whether Govt. or Private), medical
services from doctors, nurses and support staff, and the befitting funds, all are in doldrums.

Nationwide Lockdown imposed on March 25, have been extended fifth time for the period
up to end of June with some relaxations for non-containment areas.

Regarding economic situation, GDP Growth Or Economic Growth of India pre-corona

periods, was already down in : Q4 2019-20, to 3.15% vs. annual figure of 4.2 % for the
FY. Corona and lockdown effects are causing scary downturn in coming Quarters.

Global Rating Agency Fitch forecasted India’s GDP growth for 2020-21 to be 0.8% only .

India’s Fiscal Deficit; 2019-20 = already 4.6 % of GDP Highest in 7 years , likely to reach a
sorrowful figure for FY 1920-21.

However, in view of India’s inherent strength and resilience, and scale of consuming
population, I believe the economy will bounce back to a respectable figure defying such
projections.

Pandemic with the lockdown wrecked havoc on the national and global economy. It has left
millions of people jobless, MSME industry in shambles

and Govt. exchequers in quandary. No specific methods of cure by use of vaccine and or
medicines, to check the spread is on the anvil. Economists are becoming restless with one
theory to other to arrest the downturn in the depression deeper than the last great
depression in 1930’s. A main cause of the Great Depression was overproduction. Factories
and farms were producing more goods than the people could afford to buy. As a result,
prices fell, factories closed and workers were laid off.
The current depression is however due to forced closure of all industrial and business
activities, whether labour or capital intensive, small or big, Government or Private,
organised or unorganised. Only exception is probably the health care which is again free of
charges, and costs the Govt. exchequer rampantly. India’s unemployment figure has now
been skyrocketing to 23.5%. Situation is further aggravated by ‘on the move’ Migrant
Labourers stranded at various places all over India. They have been loaded in Shramik
Special Trains flouting all norms of social distancing and hygiene, and in most of the times
without food and drinking water. Few of the workers and their family members, even faced
deaths by run over in Railway tracks, road accidents and hunger.
The Shramiks were mostly engaged in MSME or unorganised sectors. MSME sector
constitute of over 67 lakhs units, 90% belonging to micro category. MSME sector alone
contributes 45 per cent of the total employment opportunities in the country. It has a share
of 50 per cent of total exports from India and 29 per cent of total GDP. During the
lockdowns this sectors cannot produce and even if they produce later, there will be no
market for the products in the foreseeable future. To add to the misery, in Orissa and in my
home state, West Bengal, the Cyclone Amphan on May 20, ravaged and wiped off
several districts. People suddenly have become homeless and crop-less and Govt.
indicated loss amounting to Rs. 1 L crores.

Government policy makers and economists across countries and in India, race to
implement fiscal and monetary measures to alleviate the financial burden and distress on
citizens and shore up economies under severe strain.

Economic theories and jargons apart, I think common sense and objective management
blended with benevolence, can solve the unprecedented problems to a great extent. The
intentions are to be devoid of political squabbles between center and state and intra-state.
I take the example of Bengal.

1. Influx of Migrant Workers to Bengal: more than 30 Shramik Special trains

cramped with total more than 50,000 people reached different districts of Bengal
adding to the distress. Further there are lakhs to follow, if not restrained. These
labours served and added values to mostly the business of jewellery, construction,
stone quarry, artefact, diamond cutting etc, and contributed immensely by boosting
productivity and profits of the owners industry. Host state must contribute suitably
and the employers must be compelled to carry out the corporate social
responsibility. The jobless labourers must be provided with food and shelter, and
subsistence allowance as required, for 2- 3 months or more. Subsequently, they
shall get back to their original employer, or to other provisions. In exception cases,
the remaining lots shall be engaged in upcoming outfits with similar or retrained
skill set. Similar principle and practice should apply to all states and the same should
be enforced by the Central Government.

The respective states shall maintain a Roster of such labourers and their skill sets
and retrain them to orient to allied skill sets to meet changed market demand. It is
feasible that the state create additional jobs in health care, infrastructure, MSMEs
with new product lines, and in rebuilding districts devastated in Amphan.
Opportunities in business and transaction, and education, in digital platform, will be
reborn and these will also pave the way for near future. The retrained workers may
be used thereof gainfully. A separate establishment in PPP model or otherwise, will
accelerate the process of rehabilitation with greater ease.

2. MSMEs: Govt. of India have recently declared stimulus package for survival and
growth of MSMEs., which includes that Global tenders will be disallowed up to Rs.
200 Crores.
 Considering the existing productive capacities of MSME, it needs to have demand
from market when the days of virus will be waned. Propose we boycott non-essential
Chinese goods like decorative lights and sheds, mobiles, toys, material handling
equipment, to name a few. Let us reserve such commodities for MSME sector. It
is time to arouse nationalism to the desired extent and to have govt. protectionism in
place to support MSMEs and ‘make in India’ initiatives. Let the citizens not use them
but buy domestic products even at higher prices. Trade agreement in WTO or other
protocols needs to be revised to meet our national need no matter of anti
globalisation. Migrant workers and also the unemployed youths will not be misfits to
MSME in the changed scenario.

When the world is in a greater depression, and when we have political will and
administrative execution, flow of fund from national and global reliefs, and Government
exchequers and public, will not cast a shadow. Only thing is that the funds are to be utilised
and reached to the affected bottom lines with honesty, integrity and transparency.

In difficult times we mitigate the risks and learn a lot which in turn build newer potential to
take on greater challenges. ‘Turning disadvantage to advantage’ is not mere a saying, but
could be a stimulating reality that history has proved time and again. So India will rise
again above the heads of many in the world. Thank you.

*****