Business, Government and Society

END TERM EXAM

Name: Divya Jain

Roll No.: 2111098
Batch: 2021-23

Submitted on
11th March, 2022, 2:00 pm
1. The Developmental state came across as fragile, falling short of providing even basic entitlements
to its citizens in the face of a severe crisis. With the benefit of hindsight, what are some of the (a)
short-term governance mechanisms and (b) long term policy initiatives that a Developmental State
can put in place to tackle/preempt such crises in future?

The article is clear on the fact that the failings of the developmental state, and the various
inequities and shortcomings of the pre-existing structures enfeebled the nation.
There is thus, a clear and urgent need to rethink policies and response systems set in place to
tackle, and even prevent such situations in the future. Certain governance mechanisms need to be
put in place such as-

Mechanisms to prioritise the short-term, and critical needs in any given crisis and and a quick
decision-making process to reduce delays and hasten the process of procuring any additional
resources required to cater to the most urgent issues.

In case of businesses and the loss of livelihood of workers, one solution could be that the
contractor and employer should run a social security fund, which would have contributions
from them as well as workers, This could be managed by an external trust for the benefit of
the workers who need financial assistance, or compensate for loss of income in times of need.
There could also be a system to given this money as a loan.

There is thus, a need for “cross-border cooperation should be actively pursued and supported at
all levels of government, in order to promote a coherent response recovery approach across a
broad territory (e.g. border closure and reopening, containment measures, exit strategies, migrant
workers).” Mechanisms are requires for cooperation across regions to minimise disjointed
responses and competition for resources.

There need to be stricter polices for imvestment in digital infrastructure and emphasis on the
promotion of use of e-government tools and digital innovation to simplify, and accelerate
procurement practices at all levels

There is an immense need to make policy changes and over-hauling of the Indian health
system. Some suggestions for the same are-
Primary care is essential, and its absence leads to poorly managed disease burden, and overcrowded
hospitals. The government needs policy reforms to ensure greater allocation of funds, and constant
monitoring for better operational efficiency.
The government can however provide support by establishing a digital network connecting private and
state centres, creating a database to use local health data to plan relevant health services, and share low-
cost tools, provide transportation of essential medical supplies etc.
There is also a need for direct government investment in secondary care infrastructure, from the district
level, along with recruitment and rapid training of doctors. For tertiary care, the State should provide
better health insurance. The enrolment for the same would include careful profiling of applicants for high-
risk conditions.

Other policy measures include fiscal policies that enable use of fiscal tools and measures,
including tax arrangements, easier access to external financing (debt), and more flexible,
financial management etc.. Reviewing financial mng, and expenditure and revenue effectiveness,
to restore fiscal stability.
Policies dictating the reallocation of part of the public funding to crisis priorities, supporting
health care, SMEs, vulnerable groups and regions.

WOED LIMIT: 478

2. This piece highlighted the problems of Indian businesses (mostly urban centric and dependent on
casual/contract labour) in the face of a severe and unexpected crisis. Given our readings on land,
labour and Agriculture what would the nature of re-boot needed in the coming 2-3 decades in (a)
industrial policy and (b) labour legislation?

(a)

The country needs a pervasive industrial strategy across Government Departments. This can’t be the
task of a single department as it influences crucial aspects of business, trade, health, skills and
infrastructure all across. There has to be a strong engagement with private businesses, the education
sector, trades unions, health industry, land owners etc.

The industrial policy must provide clear direction, and influence decision making. Government should
ensure that future industrial policy is easily understood at even the grassroot level and that all aspects
are translatable to the everyday experiences of business. A sectoral approach could be effective as well
and bring an industry-wide focus on skill-enhancement and advancing R&D.

Government should develop clear ‘defensive’ interventions to prepare workers and the community in
general for the loss of jobs and/or businesses that will inevitably occur in times of crisis. The industrial
policy should have provisions to support them in taking advantage of new work and business
opportunities. There need to be initiatives for the local delivery of such to ensure that workers and
businesses are aware of the opportunities for support.

Local strategies would build on local strengths and deliver on local economic opportunities, but also be
aligned to the national Industrial policy . The policy should also focus on coordination of local economic
policy and national funding streams and establish new ways of working government, and the public and
private sector.

This would also lead to research, and collaboration between local actors and produce valuable insights,
& establish networks of local stakeholders.

(b)

 Organisations can start having a separate bill for wages paid. This bill would only be cleared on
ce the intermediary/direct employer (who hired he workers) submits bank deposit receipts
showing that the workers’ bank accounts have been credited and to ensure that they get the
wages due to them. This would of course require institutional support in the form of ensuring
that all the workers hired, even on a temporary basis must have or get bank accounts opened.
 A regular review of the minimum wages paid by the central and state government. The govt
should take into account the productivity and other economics realities to fix a real minimum
wage, which would help reduce he gap in wages of states.
 Labour legislation which ensures that both the employer as well as the government follow
statutory provisions, There should be a mechanism to avoid violation of these provisions, as well
channels to ensure redressal of grievances without fear of reprisal.

Some agricultural reforms would center around – Public investment to raise the income. Raising
incomes and productivity in agriculture would improve the welfare of the workforce and help increase
domestic demand, It may also help reduce the rural-urban earnings gap reduces and migration
informality and unemployment.

WORD LIMIT: 458

3. The response of the civil society during the Pandemic was complex and contradictory. What
features of the Indian civil society, do you think ‘forged’ solidarity, and what ‘fragmented’ it during
this Pandemic?

The pallor of fear and uncertainty that the pandemic brought varied reactions from the society at
large was expected. It is not surprising to see that while some displayed an overwhelming spirit
of solidarity, not all civic groups played a constructive roles in the crisis response. However, the
surge in civic organizing provided an opportunity to highlight the vital role of society in
sustaining a healthy community. There can be various reasons which can be attributed for this
change. First is simply people’s need/ inherent nature to come together in times of crisis for
support or protection, or co-existence and mutual understanding of a shared experience.
There was a rise in of informal activism—self-organisations and citizens’ groups addressed
immediate practical problems. During lockdown, people were stuck together which led to the
emergence of spontaneous groups and forged solidarities to enable survival and mobility. people
pitched in with resources, their time, social campaigns etc. to help the less privileged, covid-
strickedn people, migrant workers who had lost their livlihoods etc. Eg- many of the networks
and councillors played a catalytic role in providing rations to the poor and marginalised families.
Another feature of the civil society that led to this forged solidarity could be the need or desire to
strengthen community resilience to future crisis. There is no doubt that this pandemic has indeed
become a basis of new social movements for socio-economic, political and even cultural change.
This has been due to the unprecedented impact that it has all aspects of life-business and
governance, but also because of the ensuing social movement and the narrative to strive for
change and development, for being pro-active and ensuring welfare-mechanisms, especially for
people who were most severely hit.
Another reason could be a more political agenda, where some of the activists leading the charge
could have been seeking to further a political mission.
On the other hands, as mentioned above not everyone had reacted in the same manner to the
inequities and terror that Covid brought. One feature of the State is people’s tendency to
accumulate. When the lockdown was initiated people feared that there would be a lack of
resources and resorted to hoarding as many supplies as possible. This is where the Tragedy of
commons comes into play. All people need the resources, and given the uncertainty about future
production, their was a demand shock, People accumukated supllies at the expense of others who
made do with the bare minimum of essentials. This led to further inequities, when a more
judicious and conscientious allocation would have fared better. Another example of the same is
the case of “essential medicines, oxygen cylinders, etc, to treat and
address the health ailments of the COVID-19 patients, which were black-marketed at exorbitant
prices. A part of the civil society was usurping the health and entitlements of citizens and making
civil society merely a site of accumulation. “
“Besides the accumulation tendencies, civil society also harboured sentiments of aggressive self-
preservation, inspiring the painful exclusion of fellow citizens. For instance, village communities
did not allow entry into villages of the returning migrant workers, fearing them as COVID-19
carriers.”

WORD LIMIT: 512

Part 2

The authors (from the Reserve Bank of India), make a case for how fin-tech will go towards achieving
universal financial inclusion in the country. What BGS related challenges and conflicts do fin-tech firms
negotiate in the short-run and long-run in making this possible?