Migrants under Lockdown: Reflection of A Pervasive Disparity – By Dr Shruti Bhogal* and Param Bhogal

Internal migration of labour in India, like migration in general, is largely aspirational. It is driven by livelihood opportunities and access to better basic services, with the hope of improved levels of living. Attraction of the bright lights of economically booming cities, and tales of success in progressive states, ensures a steady continuity of this phenomenon.

Pandemic for the Migrants

The COVID-19 pandemic, and subsequent extended lockdown, triggered a mass reverse migration of migrant labour, especially interstate migrants. Faced with the sudden prospect of loss of livelihood, economic insecurity, and fear of pandemic – a situation difficult to comprehend for many of them – migrants looked towards their home states for a sense of safety. Host states, unable to gainfully retain them, virtually nudged them on. This conspicuous exodus to their faraway homelands, undeterred by the non-availability of transportation, inflicted physical, social, and economic misery on millions of people. To fully appreciate their despondency, we have to remember that their current miserable situation is an exacerbation of their already desperate socio-economic status, the genesis of their original migration. Can this stark reality be fully attributed to the post COVID-19 economic downturn, or do the roots of this widespread distress lie in obscurity elsewhere?

Economic Disparity: A Stark Reality

Disparity is pervasive in our economy, and our income inequality surpasses most other countries; in fact, it is on a steady rise. According to Oxfam, wealth of the richest one per cent Indians is more than four times that of the 70 per cent from bottom. To get a perspective of the magnitude of this disparity, it would take 941 years for a minimum wage earner to earn an amount equal to the annual income of a top executive in an Indian garment company. The phenomenon of skewed income distribution is prejudicial and has far reaching moral, social, economic and political consequences. Prime reason for this inequality is the rising importance of capital among factors of production, especially in the technology driven contemporary business environment. This has led to wealth and income disparities becoming the anvil on which our economic growth story is being ideated.

Bottom of the Pyramid

Labourers are the building blocks of our economy, as our agricultural and industrial sectors (especially MSMEs) are largely labour intensive. Migrants are estimated to constitute 20 per cent of our workforce, and migrant labourers’ contribution to the national GDP is roughly estimated to be around 10 per cent. Regardless, migrant labour represents one of the lowest strata of our economy. Before migration, they are subject to socio-economic disparities in their local communities as well as state specific disparities due to economic backwardness of their home states. Post migration, they continue to be dispensable, subjecting them to further economic and social hardships. The host states barely acknowledge their existence, let alone take responsibility for their needs and welfare. Majority of migrant labour are unskilled with minimal education. This pushes most of them into the unorganised sector, or into unreported employment. This denies them the privileges attached with reported employment: job security, assurance of health care from ESI, EPF savings, government mandated minimum level of wages, etc. Thus, they lack social and economic security, ending up in uncertainty induced desperateness.

Even successive governments have remained indifferent to their plight. For instance, subsidised food through PDS is unavailable to migrants outside their home state. Given their general economic precariousness, a critical issue during a sudden economic disruption – like the COVID-19 lockdown – is their plausible degradation into impoverishment and starvation. To put this into perspective, in our country the poor spend majority of their earnings – nearly 60 per cent – on food consumption. With hardly any household savings, a sudden decrease in earnings is bound to cut into their expenditure on sustenance food. It has taken a pandemic for the government to realise the criticality of PDS access for migrants. A nationally valid ration card is now being initiated; though, arguably too late to deal with the current crisis.

The Great Reserve Migration

Conservative estimates put COVID-19 induced reverse migration numbers at 2.2-3 crores. However, the actual numbers could be much more bewildering considering that majority of the returning migrants evidently journeyed on roads. Migrants on highways boarding buses, piling into cargo and milk trucks, and cycling or trudging with their families in tow, including toddlers, has been a shocking but common sight during the lockdown.

Other recent economic disruptions, like demonetisation in 2016, have exhibited inevitability of reverse migration after such events. A notable long-term impact on migration is also indicated by experiences from economic crisis in other parts of the world. For instance, after the 2007 economic slowdown in China, 10 per cent of the migrant population that was driven from urban areas back to their native places never returned. As horrors of current reverse migration in India will not be lost on migrants soon, a proportion of them might never return, which could affect a wide range of labour-intensive economic sectors.

Perplexities of Measures

The lockdown in March began with government’s instructions to employers to disperse employee remuneration even during the lockdown period. A number of MSME employers expressed opposition to this measure. This was expected considering that the financial viability of many of these businesses was already under stress prior to the lockdown, which is showcased by GDP growth falling to 3.1 per cent for Q4 2019-20. A question worth pondering over; during a national emergency-like lockdown situation, should the responsibility of basic sustenance of citizens be passed from the government to private enterprises? Policy expectations that businesses en masse would comply without any non-debt-based relief were impractical. The resultant uncertainty seeded fear among migrants that prompted many to move homewards.

As the lockdown extended into its fourth iteration, government announced certain policy measures to support migrant labourers, like increase in MGNREGS budget, free food distribution, loans to street vendors, etc. This raised further questions about the object of these measures, pointing towards policy confusion. The objective was to reduce migrant exodus by mitigating their haplessness in the host states; or was it to provide economic support through short term employment opportunities – like MGNREGS – in the migrants’ home states? The latter ran the risk of further amplifying reverse migration. Besides, the effectiveness of these measures is also debatable. For instance, government data shows that average days of employment under MGNREGS barely reach one-third of the total promised days under the scheme. The policy scenario conveys a degree of pervasive nonchalance towards migrants, while the sheer magnitude of the unfolding human tragedy seemed to have forced the policy makers into a scurry towards action.

Overcoming the Crisis and Preparing for the Future

Transformation of the economy to overcome the highlighted disparities would be a long-term process. However, we are currently in the middle of an economic crisis, which has especially unleashed unbearable hardship on our migrant labour population, necessitating immediate mitigation. Policies would need to mollify not only their distressed condition, but also effect changes in the underlying adverse factors; the latter requiring initiatives that encompass the broader economy. Therefore, we have to think beyond distribution of free or subsidised food for sustenance, and devise emergency measures akin to CPR for the economy, primarily for short-term correction.

Cash needs to be pumped into the economy to spur demand. Direct aid to the poor in the form of cash can be a game changer. A study by FAO and UNICEF in Africa shows that every unit of cash aid to poor families can create a ripple effect, and generate 2.52 times income in the local economy. Another research on cash distribution by the charity “GiveDirectly” in Kenya estimated that every dollar of cash transfer to rural households grows the local economy by $2.60.

Post lockdown, unemployment rate across India has jumped to 23.48 per cent in May from 7.76 per cent in February, as per CMIE. Unemployment has an inverse relationship with GDP (Okun’s law); correspondingly demand, national-output and employment are interdependent. Thus, to check further slide in the economy, there is an immediate need for short term policy intervention to abate unemployment. A job guarantee programme for the educated and skilled unemployed workforce – a section different from the one targeted by MGNREGS – can be implemented, at least for a limited period. This envisages part-time work for them in community or public sector at fixed minimum remuneration. Job guarantee in theory has been proposed by a number of modern economists as a policy tool to reduce unemployment without causing adverse inflationary effects. Besides this, other measures like tax benefits to the middle class, and unemployment and pension allowances will have dual benefits: individual welfare and demand upsurge.

MSME sector in developing countries like India employs more than 60 per cent of the workforce, as per World Bank. Therefore, this sector specifically requires immediate direct support to tide over the current economic downturn; tax benefits, direct cash support, interest and utility bill waivers for the lockdown period are some avenues. Concurrently, long-term reforms need to be expedited to enable this sector to catapult towards growth once the economic impacts of COVID-19 begin to subside. Despite India’s rising EODB ranking, on the ground a heavily government regulated business environment continues to encourage red-tapism, which is especially challenging for MSMEs. A policy shift towards broader self-regulation for businesses can be a major positive disruption in this direction.

The COVID-19 pandemic is an unprecedented crisis that has affected every level of our society. From a socio-economic perspective, more than anything, it has showcased the extreme disparities that have become inherent in our current economic priorities and strategies. This disparity is no longer invisible, or observable only by statistics. Rather it has come to the fore through the visible destitution of migrating labourers. Therefore, playing oblivious to its scale or ubiquity in our market economy is no longer an option. This presents us with an opportunity to re-strategize the trajectory of our country’s development. A comprehensive plan in this regard that prioritises the minimisation of economic disparity is a prerequisite for an all-encompassing growth; especially considering that sustainable development goals are to be achieved by 2030, encapsulation of ameliorative measures – for alleviation of poverty, hunger, malnutrition and infant mortality, and individual wellbeing – is required. In this regard, a concerted effort is required to improve public hygiene and healthcare, education, skill development, and other public services, which can have a direct bearing on the downtrodden, especially migrant labourers. Inclusivity, and apathy towards none, should be a litmus test for all policy plans and initiatives henceforth.

*  The first author is a Postdoctoral Research Associate at Centers for International Projects Trust, New Delhi, and formerly a Teaching Assistant with Punjab Agricultural University. She has done her doctorate on the subject: Socio-economic Implications of Labour Migration.