How India can tackle the approaching storm10 min read . Updated: 02 Mar 2020, 12:57 PM IST
As coronavirus spreads across the world, India has to brace itself for an impact on public health and the economy
As coronavirus spreads across the world, India has to brace itself for an impact on public health and the economy
Hyderabad: The world must quickly prepare itself for a major crisis. The World Health Organisation (WHO) has all but declared the Coronavirus (Covid -19) as an international emergency. At the time of writing, the Lancet’s online dashboard has reported 86,983 cases and 2,978 deaths across more than 60 countries. Looking at the spread and number of fatalities and cases that are being notified globally, Covid-19 is definitely close to being declared a pandemic.
When does an epidemic become a pandemic? An epidemic is the sudden rise in the number of cases of a disease or infection, usually limited in its geographical reach. For instance, the Ebola virus epidemic in 2013 resulted in the death of over 11,000 people, but it was largely restricted to Western Africa. A pandemic, in contrast, is an epidemic that has spread over many continents and countries, and does not rely on local transmission anymore for the spread of the infection.
It is just a matter of time before coronavirus will hit India—it is a matter of where and when. It goes without saying that India needs to be very well prepared. There is no need for alarm, but no need for complacency either. The bad news, according to a senior health expert formerly with the WHO who spoke on the condition of anonymity, is that India seems to be “blissfully unaware and firmly complacent". There is no certainty that the threat will subside in warmer temperatures. For a new pathogen, against which immunity hasn’t yet developed, it is, as always, far better to be safe and well prepared, without creating unnecessary panic.
There are two kinds of impacts that we need to be worried about. There is, of course, the crucial issue of how India’s public health institutions are able to tackle the problem. The second is the obvious impact on India’s economy and global trade. The next few weeks will determine whether all the efforts that are being undertaken can prevent Covid-19 from becoming the “black swan event" that statistician Nicholas Taleb had first used to describe 9/11. Can it derail the global economy?
The economic fallout
Covid-19 will cost the world economy over $280 billion in the first quarter of this year alone, which means that global GDP will not grow from one quarter to the next for the first time since 2009. China’s growth is expected to slow to 4.5% over the same period. Japan is also watching the situation anxiously as the Olympics scheduled this summer can suffer if the threat does not go away quickly.
More than 5 million companies worldwide have Chinese suppliers and all of them are under threat from slashed manufacturing capacity. Supplies from China will stop as soon as the assembly lines cease or decrease production. The impact is now being felt across the world and across various sectors of the economy.
The manufacturing space has been the worst affected. Electronics and furniture are the two sectors that source nearly two-thirds of their imports from China. The auto sector has already been badly hit with Hyundai and Nissan closing down a few of their plants in Korea and Japan, respectively, as supplies from China have stopped. Smartphones, optical fibre cables and integrated chips (the three items that China specializes in) have all been badly hit and downstream industries that depend on Chinese imports across the world will now have disrupted production schedules.
And then, there’s the freeze on the movement of people. With 50 countries banning travel from China, the situation is getting worse by the day. The Chinese are also the world’s most prolific tourists now. Countries like Thailand and Indonesia depend on tourism, with nearly one-fourth of their tourists coming from China. Thailand, therefore, has not restricted Chinese tourists yet and neither has it stopped issuing free visas on arrival to tourists from there. Cambodia too has been careful, and in fact, the President even travelled to China to demonstrate loyalty to a country that is its largest foreign investor.
However, with the fear spreading, this will not continue for long. US firms like Apple have stopped flying their executives to China.
Impact on India
In 2003, when SARS in China caused big disruptions, the impact was substantial enough but nowhere close to where it is now. The world is far more China-dependent with 16% of world GDP coming from there. Firms that saw their supply chains jolted back then have only increased their exposure to China and have not been prepared for such a debacle at all. With logistics and transportation lines improving considerably, most firms did not even imagine such an act of God would disrupt their production schedules.
They did not, therefore, build any cushion, nor did they plan for any such calamity. Today, in India, a number of electronic firms are rushing to the government to come to their rescue. What can the government do in this situation? While the finance ministry is making promises that Indian companies will not face any problems, there are no easy solutions. Supply chains cannot be shifted to other countries quickly.
There is also misplaced joy among those who think India will benefit while China suffers. Such people are simply not aware of what it takes to have the trade advantages that China has developed over the last five decades.
If Indian firms want to develop new hubs in new countries, it will take a long time to take it up to speed. Sectors like electronics and auto spares need large amounts of capital investment and technology upgradation, apart from human resource and technical capacity. The China advantage is huge and other smaller countries will not be able to reach those levels, certainly not in a hurry. It is not possible for new manufacturing zones to re-engineer the complex set up that China has built. Replacing a country that suffers from setbacks like a Tsunami or a virus attack is not as easy as it appears.
There is nothing that the world economy can do except to help China fight the calamity and ensure the virus does not spread and cause mortality and morbidity elsewhere. Going forward, supply chains must be better prepared for pandemics. Over the next few months, all logistics and project managers must rewrite their plans. Over the medium-term, some new hubs will need to be developed and surely China itself will be doing this in order to avoid having a repeat of what it went through in 2003.
India, meanwhile, has to get ready to face supply disruptions in its pharma, electronics and the furniture sectors.
Public health challenges
Any large flare-up of a contagious disease results in a number of externalities and horrors. People become wary, suspicious and then start behaving violently against those who contract the disease. It begins with caretakers simply abandoning infected relatives and then gets worse. According to a former communications specialist in public health, there are plenty of examples of how transgender populations were beaten and lynched during the early days of HIV/AIDS. These are scary indicators of what could come if the fear spreads. Given the climate of hate and fear that exists today, we should be extra alert to safeguard those who fall prey to this virus.
Therefore, it is essential to be prepared, even for a worst-case scenario, wherein, a large number of people get infected. It is when we get ready to handle these large numbers that we will put in place the surveillance and quarantine facilities that India needs. Health officials at all levels must ensure that they don’t cause panic.
At the technical and the political level, we must desist from taking just state-led solution that we seem to be moving towards. Coronavirus is not going to be tackled at the government level alone. If it could be, the infinitely more efficient state in China would have stopped the disease from spreading on day two. This fight has to be fought at the community level. The state must understand this and include civil society. Here’s why: thermal screening—the major tool being used by the state—can only catch between 20%-50% cases. Which means that up to 80% of cases could be missed. Large-scale NGOs need to be involved to do symptomatic surveillance.
It is important to understand that people shouldn’t be forced to go to the nearest hospital just to get tested, which can increase the possibility of hospital-based transmissions. We, unfortunately, don’t have any such facilities, except in the military hospitals that will handle only a very small number of cases. Cases should stay within the community—that is how we will seal transmission. Using NGOs, necessary supplies of food and drugs should be supplied at home.
There is also a disquieting uncertainty about how we will treat the infected and diagnosed patients. The quarantine complacency is dangerous. Where social stigma is involved, and in a country where there is already a prevalent atmosphere of lynching and fake messaging, it is important to get the community aware and prepared to participate.
What India should do
The Covid-19 epidemic is a red flag to the country, highlighting the urgent need to ramp up public healthcare systems and build awareness at the local community level in order to help deal with a potential calamity. At the moment, only Kerala has detected cases, but that is possibly because the state is the one with the best health infrastructure and has been watchful since the Nipah virus attack in 2018. That explains why there are only 3 detected cases so far.
This is not because of a robust health surveillance system but largely due to the low level of substantial movement between those parts of China which are highly infected and India. The number of Chinese tourists who visit India is relatively modest. Also, the lockdown on travel from China immediately as soon as the infection had started has reduced travel significantly between the two countries, further reducing the possibility of its spread.
While India needs to implement robust screening procedures at airports, we have to go beyond merely thermal scans and include checking the travel history of passengers, according to a former Health Secretary of the Government of India. Identifying those who could be potential carriers of the virus from close contact with infected persons at all airports and entry points is absolutely crucial now. Particularly given that a number of new cases are increasingly from outside China.
And this takes on even more serious implications if the current situation takes on the status of a pandemic, where person-to-person transmission can happen independently of any prior connection with an original case from China. That would mean monitoring and restrictions on entry of not just Chinese but also other country’s flights and citizen movement into India.
Clean and safe quarantine facilities have to be maintained, along with carefully-regulated and monitored procedure for health workers who man the frontlines. The availability of drugs and other necessary medical equipment has to be reinforced with protective equipment and laboratory testing facilities. Communication is also a key driver in handling an epidemic situation.
The spread of misinformation should be contained as far as possible. It is the responsibility of the government to ensure that local and national health authorities deliver the correct messaging on risks and infection protocol to the community at large.
India faces numerous challenges when it comes to being prepared for epidemics and outbreaks. Not only do we have a large population which is spread across a very large geographical area, but we also have to deal with a severely hampered public health system with poor infrastructure, extreme shortage of healthcare personnel, limited public funding and a very inadequately functioning primary healthcare structure.
This is further compounded by high rates of internal migration. The assumption that large cities and state capitals are prepared for emergencies can be questioned by the prevailing twin epidemics of Dengue and Chikungunya in most major cities in the country.
What India requires, therefore, is an efficient and effective disease surveillance system which is functional throughout the country and not just in urban areas. For the moment, however, the bottom line is that we must fight the epidemic first, then worry about the economy.
Amir Ullah Khan is Professor of Development Economics at the MCRHRDI and Saleema Razvi is a Senior Research Economist at the Copenhagen Consensus Centre.