Thursday, May 28, 2020



MIGRATION: THE CAUSE AND EFFECTS


 Migration is not something new, which existed from time immemorial among all civilizations. Early man led a nomadic life moving the whole community from one place to another depending on the need. He looked for fertile land for farming, easy access to water resources and food, and protection from wild animals. Basically, his requirement was limited and he lived happily.

As civilizations grew and prospered, the concepts changed and the community was divided into units of joint families consisting of parents, grandparents, the siblings and their children living under one roof, often managed by the senior most member of the family. As the community population increased as also the education levels, the jobs available locally became scarce, and forced the younger and educated to move into the cities where they could find jobs easily. This further reduced the family size. Moreover, with the globalization of economies, people started moving to overseas destinations and many of them settled there. Many got permanent jobs and settled in their new found host countries, while others took up contract jobs for specific period of time.
But today’s scenario faced by the country is a case of reverse migration forced by the circumstances. The COVID -19 has done unspeakable damage to world economy and no country has been spared. The Europe and Americas are reeling under pressure and no one has found an answer so far. Indian Diaspora has their prominence all over the world, especially in the Gulf region where plenty of contract workers are employed in construction and other business. They include masons, carpenters, plumbers, electricians, etc. whose jobs are contract to contract and they will come back to India on the expiry of their VISAs unless they find some other employer who will take them over. The bulk of them are from Kerala, followed by Tamil Nadu, Karnataka, Andhra Pradesh and Rajasthan.

In our culture, we always care for the loved ones. Most of the migrants have their families deep rooted in their village and would like to be with them whether they have anything to eat or not, especially when a catastrophe like Corona strikes. Look at the root cause for the migration. An average Malayali is a communist by default and his primary job is to hoist a red flag before every business unit and, as a result, no one is willing to invest in Kerala for fear of getting into labor disputes. This leaves him to look for opportunities elsewhere. The opening up of Gulf market in the 60s and 70s was a boon and that found a huge traffic of semi-skilled labour landing there with several jobs. After the expiry of their VISAs, normally they found another employer to hang around who was only happy to pick them up. These resulted in huge remittance of foreign exchange by the Diaspora and, in turn, it helped to boost India’s foreign exchange reserves.

This brought a unique opportunity to the jobless labourers in West Bengal, U.P., Bihar and other North Eastern states to fill up the vacuum created by the labourers of Southern States who moved outside India. The successive governments in these states had wilfully ignored the development of the region and hence those states could not provide enough jobs to the young. For example, Mayavathi, who was the Chief Minister of U.P. earlier, spent Crores of Rupees in building statues of elephants all over the state instead of addressing the situation of jobless youth in her state. If you visit any Southern state for that matter today, you will find plenty of migrants who have moved from North to South working in hotels, hospitals and other establishment.

Now, here comes the great Corona virus also known as COVID-19 from a research laboratory situated in Wuhan, a town in China. The international travellers carried the infection further and the virus spread like wildfire killing thousands all over the world. Many countries declared total lock down in several towns that forcibly closed restaurants, cinema halls, malls and grocery shops making people remain at home. Thousands of jobs were lost. Being summer, the hospitality industry was the maximum affected. The main sufferers were migrant workers who were living on rented accommodation and without an income, they suffered silently.

Look at the scenario here. He cannot pay for his accommodation and food if he continues to live in the cities, and if he goes to his native village, the case will be the same with only difference that he will be with his loved ones. So, the majority of them decided to go back to the village. All the regular trains and other means of transport had been cancelled during the lockdown and the migrants were left with neither money nor transport to go to their villages. The central and state governments mobilized all the resources at their disposal to provide a comfortable transport to the migrants, but the demand was too high to match the reality.

But what does the future hold out for us? Who is going to replace the skilled labour that went back to their villages? When the Corona virus subsides, are they going to come back to their former employers?  I have a strong feeling that most of the migrants who returned to the villages are going to come back to the cities for jobs because the village does not offer a job for them. The employers will also be big losers because the trained work force has left them and it will take a long time to train a NEW work force.
During the Gulf war a lot of Indians returned to India, and when the war was over, most of them went back. This leaves some questions unanswered. When a person takes up a job overseas on his own, is it the responsibility of the government to bring him back? On a general note, I would say NO. But when a catastrophe like Covid strikes, the repatriation of its citizens becomes a government duty.

What can we do when thousands want to go back to their villages where they will have nothing to do? An ideal option would be for the employers to meet their accommodation costs and also advance them salaries for a period of at least 3 months to start with (the employers can be reimbursed such expenses by the government) and this would avoid peoples’ rushing back to their villages in panic and also help the employers to retain an already trained work force to run their plants. The pandemonium we have been seeing in the inadequately sanitized trains and the crowd on the roads is terrible and this is going to result in the migrants infecting more people in the villages helping the spread of the virus. We can only hope that the think tanks in the government will take appropriate steps in the right direction. It is sad to see that some politicians from the opposition parties trying to capitalise from this situation instead of standing with the government in this hour of crisis.


Friday, May 1, 2020



A CASE FOR IMPROVING THE SOUTH ASIAN ECONOMIES


We have all along been following blindly the concept of measuring the economic growth based on the GDP of the nation. This is just based on the production of goods and services that varies from time to time. You put more money in the hands of the people so that they will buy more goods and services and this increase in demand will act as a catalyst for increase in production and create more jobs. The Central Bank keeps cutting bank rates hoping that the banks’ increased liquidity will help them to lend more.

Conceptually it looks good. But in their haste to find a genuine business, the banks often end up playing into the hands of Mallyas and Chokshis who, in the end, flee the country leaving behind a sizable amount of their borrowings as Non Performing Assets in the Balance Sheet of the lending institutions. These guys go unpunished because of the tremendous political clouts they wield, leave aside the length of time the courts take to dispose of their cases.

 In addition, there is this credit card business which simply increases the purchasing power in our hands and, as a result, we end up buying things which we don’t need. America lives on credit. Many of them live a life of pay check to pay check which means, if they don’t get paid by the 15th of the month, their life would come to a standstill. The credit cards are extensively used in every transaction which, in fact, means buying in the present against a future income. The accumulated balances on credit cards have always been a problem, especially during a global catastrophe, like Corona Virus, ultimately ending up bankruptcy of the card holder and making domestic life miserable often leading to violence.

When the recession towards the end of the last decade made the world economies to run for cover, India survived because of the saving habits of the people. In the recent past, a lot of noise was made in India about the affordable prices of onion. There was a lot of panic around. The simple solution would have been to reduce your consumption and look for alternative food. You are not going to die if you don’t eat onion for a while. When the demand goes down, the prices will come down. Again look at the crude prices today. It has gone to sub zero levels. The national lockdown declared by most of the countries has pushed the vehicles off the road resulting in a drop demand. The end result: The oil companies operate at lower capacity and so many jobs are lost. All these are vicious circles.

In any assessment of economic performance of a country, the happiness of the population is another factor to be considered. If you look back, a few decades ago, before the technology brought us television, computers, cell phones, internet, etc., were people not happy living?  While technology helped in connecting the global population, it had its own disadvantages in that cyber crimes increased, countries started spending more on military and other allied services regardless of whether they could afford the spending or not. The newly acquired technology is being used more for the improvisation of the military capability than to quench the hunger of the masses and treating millions of sick all over the world.

Recently, India placed an order for 36 Raffle jet fighters from France at a whooping cost of 35 billion to counter the challenge from F-16 fighter aircraft that Pakistan acquired from the USA. While this puts the two nuclear neighbors in a balanced position, the people who really gained are the business entities who supply the warplanes.  That means the governments equip themselves to guard against a possible threat from the neighbor which is just notional and if there are no wars in the near future, the investment in the technology becomes not only a waste but, over a period of time, it becomes obsolete and you start investing again to replace the old machines with newer one, of course at the tax payers cost. Imagine, if all these resources are deployed for the development of the economy, to what extent we can improve life quality of the poor and downtrodden. The USA, China and India put together have an estimated annual budget of 1064 billion US Dollars for their military, and even a reduction b y 50% will make available plenty of resources for development. The economists never link the happiness of the masses when they put the figures together.

How can we solve this riddle? If you stop for a moment to think on the following proposal, the economies of South Asian nations will grow rapidly, and with their brainpower and skilled lab our force, can compete with the best in the world.  Full openness and trust between the nations is a must to achieve this. The nations with a common borders  like India, Pakistan, China, Bangladesh, Nepal, Myanmar an Sri Lanka have to come together and  sign a NO WAR PACT FOR THE NEXT 50 YEARS, leaving the border disputes where they are. This will ensure peace and tranquility in the region and there being no fear of war, all the partied concerned can concentrate on the development of their respective countries. This will become all the more relevant now, when the world nations are trying to recover from the onslaught of the deadly Corona virus. This idea, to be successful, the concerned nations have to come to the negotiating table throwing out of the window, the attitude of suspicion they had for each other. If we come to a common understanding and start working towards this achievable goal, I am sure this planet will become a beautiful place for human in-habitation. Remember the old adage, “there is no winner in a war”. But all we need the political will.