How Urban India will be Disrupted — Covid-19
We are in the 56th day of lockdown and have experienced so many unusual things. We did things we never have done before. For each one of us, the experience has been unique. While majority of us are doing something or the other, professionally and personally, there are thousands out there who don’t know what should be done, and, are completely unaware about their future, both short term and medium term.
Yes, I’m talking about workers, Migrant workers. Except certain categories, the unorganized manufacturing and service sector is mostly shut.
Movement of workers from metro as well as non-metro cities is on the rise, a clear reverse migration. It has been a sensitive topic since the incident (or I must say tragedy) happened on Delhi-Uttar Pradesh border. To give a brief of the situation, on 26th on March, 3 days after the national lockdown was announced, there were rumours that government wont be providing ration and the lockdown will continue for coming 3 months. The rumour spread like fire, there were people out on streets wanting to return to their hometown (mostly Uttar Pradesh & Bihar). All of them gathered on UP’s border, since there were strict guidelines, movement of vehicles was regulated and 1000s ended up being gathered on the border.
Just to quote, Delhi is home to 5.4 million migrant workers who live and work here, and are mostly employed in the lower pyramid of company’s hierarchy. Let’s move on from Delhi and focus on other urban areas.
In the last 3 weeks, we have seen migration emerge as a crisis along with Covid19. We are seeing visuals from different part of the country. people walking on highways towards their home state. Even when we hear this, a person walking from Mumbai/Bangalore to UP/Bihar (journey of more than 1000 km during peak summertime) it sounds so scary and unbelievable, but, it is happening. I’ve myself experienced, seen and documented it here. Everyday thousands and thousands of people are moving out of metro cities, media is directly reporting from highways, pictures are being widely shared on social media.
Despite the dreadful reality, we see our government failing them everyday, both state and central. In my opinion, even the society has collectively failed them.
We all know these are hard times, economically, emotionally and socially, but if all of us could take care of our employees, contract workers and other workers, some sense would have prevailed. But I guess, we failed, maybe because we were busy figuring out our own lives. I hope everyone cooking some new dish, attending some random webinar, posting old pictures on Instagram are doing something for their domestic helper/employee. Till now, 25 lakhs migrant workers have migrated back across the country.
Coming to the point, how and why Urban India will be disrupted. Let me first start with why it will be disrupted.
The Why ?
I’ll take Mumbai as a base example. A lot of services that I’m going to mention are inter-related and exist in other urban areas as well. Let’s now breakdown to where these people, the migrant workers, work ?
Which Sector & Industries ?
Starting with Service Sector - Security Guards, Waiters, Housekeeping, loading & unloading (across spectrum), street vendors, domestic help, salon & parlours, rickshaw & taxi drivers, courier delivery boys, auto service providers and the list goes on and on. If I talk about Manufacturing, you can pick any industry and you would see that the workers play a significant role in a factory, they run the ground zero operations. Let’s consider textile which contributes 2% to our GDP, all basic operations from handling machinery to manual printing is done by workers. They are all are moving back, and will keep moving until the Covid-19 picture is more transparent and positive.
Along with monetary stimulus what we also need is human stimulus to run the economy.
There is no specific industry that will be affected, the whole economic and supply chain is going to be disrupted somehow. If we see the sectorial distribution of MSMEs, it shows 49% from rural and 51 % from the semi-urban and urban areas. A study by the AIMO estimated that about a quarter of over 75 million MSMEs are facing closure, if the lockdown still extends the situation would worsen affecting the employment of 114 million people affecting the GDP.
The How ?
Blue Collar Jobs — As we open up, every MSME and businessperson would need their employees back to start the operations. They may start taking orders but delivering the orders would become super difficult. Service sector will start providing service but due to social distancing guidelines a lot of discretionary and lifestyle spend will go down drastically.
White Collar Jobs — Layoffs have started, Ola has laid off 1400 employees, 35% of their workforce, and many more companies are on laying off spree. The economy will take huge hit, which will impact the demand and consumer spending. The 20 lakh stimulus package announced by finance minister of India focuses on liquidity but not on demand creation, which is a big failure. If government had actually given 20 lakh stimulus, we would have been a lot better off. As the economy takes downward path, the impact will be seen on whole cycle. Indirect job creation of blue collar jobs will be impacted.
Workers shortage will make it worse for the existing demand and the sectors which can start full operations (real estate construction activity) will slow down.
My brother who has transport business, provides vehicle to India’s largest eCommerce company and a cash management company. His drivers have migrated back from Delhi and are not ready to return, even after being promised financial benefits, food and shelter. The Corona Virus fear will stay for a considerable amount of time.
They will return, but it will take time. And the way they were being treated will be changed. Society needs act now, collectively.
Urban India has had enough, everything was available to them with a click, they considered themselves superhumans with the ease of availability. The reign has come to an end, I don’t know about the economy but every person, elite or non elite, middle class or not, will have to be AatmaNirbhar. Urban India won’t be the same again, buckle up and become more active. Your privilege was someone’s hardship, that needs to be changed, now and forever.
This isn’t the end though, India on the global map has some of the biggest opportunities ahead, we’ll talk about it some other day.
