Will Covid-19 vaccination roll-out help Indian economy heal?

With International Labour Organization (ILO) projecting that economy of most countries will recover in the second half of 2021, depending on Covid-19 vaccination rollout, India may expect its wrecked economy to heal after kicking off its nationwide Covid-19 immunisation program that completed 10 days on Tuesday.

Health economists believe that India’s vaccination program may help in economic recovery as the situation of women and children expected to improve with health programs resuming after vaccination of health workers and more people joining the workforce.

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According to operational guidelines for vaccination issued by the Union health ministry, the Covid-19 vaccine is being offered first to healthcare workers, frontline workers and to persons above 50 years of age. It will then be offered to persons younger than 50 years of age with associated co-morbidities based on the evolving pandemic situation, and finally to the remaining population based on the disease epidemiology and vaccine availability, the guidelines state.

The priority group of above 50 years may be sub-divided into those above 60 years and those between 50 to 60 years for purposes of phasing of rollout based on the pandemic situation and vaccine availability. “Vaccination will wipe out the fear and help everyone participate and perform their bit in the process of growth and development. However, more important is to initiate proper planning for the informal economy,” said Arup Mitra, professor of economy at the Institute of Economic Growth, University of Delhi.

“The workers engaged in the informal economy are back to earn their livelihoods. However, there has been a huge decline in the effective demand. Alongside vaccination public action will have to be directed to rejuvenate the economy,” he said.

The ILO report has analysed the impact of the pandemic on the global labour market. It finds that 8.8% of global working hours were lost last year, resulting in a decline in global labour income equivalent to US$ 3.7 trillion. With the projections of recovery in the second half of 2021, depending on vaccination rollout, it has also recommended international support for low- and middle-income countries to support vaccine rollout, and to promote economic and employment recovery.

Women and children across the world including India remained the worst affected groups during the Covid-19 pandemic pushing them to hunger, poverty and lack of access to healthcare during lockdown.

“The Indian economy is indeed awaiting a return to normalcy in sectors such as travel, tourism and education. These three are the ones that are now carrying most of the Covid-19 burden and have yet to start operating at anywhere near pre Covid-19 times. They are also the sectors responsible for enormous job losses and consumption declines,” said Amir Ullah Khan, Senior Research Fellow a Rajiv Gandhi Institute for Contemporary Studies (RGICS), a social think tank.

“Targeted vaccination will need continuous and smart tracking, tracing and testing. We will need to do all this to be able to cover two thirds of the more vulnerable population quickly,” he said.

India has granted emergency use authorisation (EUA) to two Covid-19 vaccines -- Pune-based Serum Institute of India’s Covishield and Hyderabad-based Bharat Biotech International Ltd’s Covaxin which are being used in the government’s vaccination drive. The Prime Minister Narendra Modi launched the nationwide Covid-19 vaccination drive virtually on January 16 terming it as the “world’s largest vaccination programme" covering the entire length and breadth of the country.