News analysis

India struggles to put lockdown in place

First day of restrictions to curb virus spread marked by chaos, supply chain disruptions

Following the start of a three-week lockdown at midnight on Tuesday, India is facing serious challenges - from ensuring that essential groceries and medicine reach people, to encouraging social distancing and helping the poor through a time of wage disruptions.

Prime Minister Narendra Modi on Tuesday announced the biggest lockdown in the world, which will essentially keep 1.35 billion people restricted to their homes in a bid to break the coronavirus transmission chain.

With 10 deaths and infected cases climbing above 500, Mr Modi has urged people to stay indoors, warning that a mass coronavirus outbreak would be disastrous for the South Asian country.

The first day of the lockdown saw signs of chaos and ample anecdotal evidence of supply chain disruptions, in spite of assurances to the contrary by the government.

Teething problems reported included the police cracking down on vegetable vendors, delivery trucks being blocked at borders and delivery boys getting stopped, even though essential services are exempt from the lockdown.

Panic buying was reported at grocery stores. Online grocery providers, from Big Basket to Flipkart, announced that they were temporarily unable to fulfil deliveries due to logistical issues.

Social distancing has emerged as a key measure in the fight against the virus. But that is proving to be difficult, particularly with the poor living in crowded spaces.

Water, too, remains in limited supply in the slums, making even something as basic as washing hands frequently difficult.

Social activist Nikhil Dey said: "For the poor, (the) lockdown is a massive problem. The urban poor live in such close proximity to (one another)... within one room and outside also; there is no space.

"The rural poor also have big issues because a lockdown isolates them and they don't get information related to food and health. It is a humanitarian crisis."

Mr Dey, along with others, has urged the government to consider giving cash handouts of 7,000 rupees (S$130) a month to each poor household for two months, as well as to provide free food.

 
 
 
 

"As far as social distancing is concerned, if you don't have food or (if you) are not well, you are going to break the rules," he said.

Daily-wage labourers are particularly at risk, with the lockdown halting economic activity across sectors.

Some have come up with offers to help the poor.

Mr Anand Mahindra, chairman of Mahindra Group, tweeted: "The lockdown's necessary, but will be devastating for the homeless, daily-wage earners and contract workers. If each of us takes care of the daily rations and essentials of at least three less privileged families, it will have an exponential effect, but unlike Covid-19, it'll be a 'good virus'."

Yesterday, the government moved to address some of these concerns.

Federal Minister for Information Prakash Javadekar announced that rice would be available to 800 million of India's poor at a subsidised rate of three rupees per kilogram instead of 37 rupees, while wheat would go for two rupees per kilogram instead of 27 rupees.

"The government is studying the financial impact of the coronavirus - let's solve the crisis first," he said.

Still, the country is expected to feel the economic cost of the lockdown. India's economic growth fell to a six-year low of 4.7 per cent in the last quarter of last year. Experts predict the lockdown would significantly dent India's gross domestic product (GDP) growth, making this an even worse year for the economy than the 2008 global financial crisis.

 
 

Mr Rishi Sahai, managing director of boutique investment bank Cogence Advisors, said: "I expect the lockdown to dramatically reduce GDP in the current and subsequent quarters, while there will be prolonged economic gloom throughout the rest of the year."

The biggest whammy will be to private consumption, which accounts for 57 per cent of India's GDP.

Forecasting service Oxford Economics has slashed India's growth forecast for the first quarter of this year to 3 per cent, a number not seen even during the worst of the global financial crisis, Mr Sahai noted.

 
A version of this article appeared in the print edition of The Straits Times on March 26, 2020, with the headline 'India struggles to put lockdown in place'. Print Edition | Subscribe