COVID - 19 Second Wave In India – The Solutions

The first wave of COVID - 19 started receding around Oct 2020, in India, & Health Minister, Harshvardhan, in the 1^st week of Mar 2021, declared, “We are in the end game of the COVID – 19” – a premature victory announcement revealed in hindsight. Complacency could partially explain why the National Covid Task Force went into hibernation then but woken from its stupor, now, is warning of a likely 3^rd wave. Preparations for tackling a 2^nd wave, apparently, were non-existent & the lowering of guard was visible vide violation of social distancing norms during the just concluded “super spreader” events - state elections & preponed Kumbh Mela celebrations. No wonder the respected international Medical Journal, The Lancet, called it a “self-inflicted national catastrophe”. Regrettably, the 4^th Estate, was busy peddling the narrative of either “Vaccine Nationalism” or “Vaccine Diplomacy” & the whatsapp university played amplifier, instead of warning the powers of the impending crisis 

History often repeats itself first as a tragedy & then as a farce. Lessons ought to have been drawn from the Spanish flu, of 1918, that boasted of a more virulent 2^nd wave & a milder 3^rd wave; similarly, assuming that India shall remain untouched even as western nations were hit by a 2^nd & 3^rd wave, a few months back, is nothing short of delusion.

As expected, the blame game has begun with supporters of the Central govt. blaming the states for reneging on their responsibility on “Health”  - a “state subject” while those supporting states blaming the Centre for not accelerating “vaccine production”- & opacity on the usage of the PM Cares fund. The loser, in either case, unfortunately, is the Indian citizen.

What Should Have Been The Indian Strategy?

The Global average is about 3 hospital beds per 1000 population while India, with a population of 138 crores (Cr.) about 16 Lakh beds, against  41 Lakh beds as per Sumeet Aggarwal, in a 2017 ET Healthworld interview. About 60% of these are contributed by private hospitals. Assuming an average of Rs 1 cr. investment, per hospital bed, requires an outlay of Rs 25 Lakh cr. (~ 13 % of GDP), impossible to achieve during a pandemic year, as this is about 70% of the combined state budgets of about 35 lakh cr. per annum. Even if states did divert resources towards healthcare, clogging of hospitals, as witnessed in many western countries, with impeccable infra, during the peak of the pandemic, was inevitable as hospital bed capacity is not designed for peak load; states cannot be condoned, though, for failing to put up oxygen plants, at each public hospital, when the cost is about Rs 1 cr. per unit only. The solution thus lay in fast vaccination of the 94 cr. adult (>18 years old) population, costing about Rs 28400 cr. (94 cr. x Rs. 150 per dose x 2 doses) or about 0.15 % of GDP. Paying double the price at Rs 300 per dose too was cheap at 0.3% of GDP.

India could have wisely learned from Israel which secured Pfizer vaccines at $30 apiece, double the, prices paid by its western counterparts, for early delivery, which its Prime Minister Benjamin Netanyahu, reasoned was cheaper than the economic losses accrued due to lockdowns; of course, this was linked to sweeten his re-election bid too. Western Nations, including the US, UK etc. paid & blocked vaccine supplies, from multiple vendors - Pfizer, Moderna, J&J, Astra Zeneca etc.-  enough to vaccinate their population many times over, inviting criticism of “Vaccine Hoarding” & hence discrimination by the Global South. Obviously, India, a Middle Income country, with high population, cannot afford to block supplies, of costlier vaccines like Pfizer, costing $15-30 apiece, which requires a robust cold chain infra too, to store vaccines at -70 degrees, which India lacks; but blocking supplies of Covishied & Covaxin costing $2 apiece was always possible. Furthermore, this crisis presented an opportunity for India to buttress its claims as the “pharmacy capital of the world” by helping the global South.

India, therefore, should have decided on vaccinating 94 cr. (>18 age) population, in 6 months, needing 188 cr. doses. Funding capacity expansion could have happened either vide a subsidy, higher price of procurement or paying an advance for the entire supply, in 3-4 tranches – the last option, obviously, was the cheapest & hence recommended. It should have paid advances for procuring Serum Institute’s Covishield & Bharat Biotech’s Covaxin, to up capacity to 30 – 40 cr. per month. Post domestic inoculation, supplies should have been made to the rest of the world, to enhance its soft power. Instead, we are now at the mercy of other countries begging for supplies.

Why Is the Private Sector Loath to Invest?

Return on Investment (ROI) for private hospitals is in low single digits - since it faces a nutcracker case of rising costs, courtesy inflation & war for talent & greater govt. controls on prices of consumables - drugs, stents, implants -  which bring 2/3^rd of their profit margins apart from treatment procedures & medical devises; paradoxically, increased insurance penetration & hence greater bargaining power gained by institutional customers – insured patients, corporates & govt. funded patients – has also capped healthcare prices. While the govt. is right in creating a regulatory framework of “affordable healthcare” it must accelerate public investments into healthcare in the light of waning private investments – inferred vide many promoter sell offs in corporate hospitals.

Against this background, policy wonks would have expected a joint declaration last year, by the Centre & State governments, to spend 2 lakh cr. each, in capital investments yearly, for the next 5 years, to improve health infra. Meanwhile the Private sector could adopt digital models of faster & cheaper service delivery & tap more international business – to attract cash patients to achieve cross subsidy – & enhance margins.

Way Forward:

(1)Increase investment in healthcare: History of Nipah Virus, in Kerala, in May 2018, or the multiple waves of Corona, since Mar 2020, proposes the likelihood of similar pandemic waves, in the years to come,either due to virus transmission across species or due to bio-warfare. Increasing hospital beds to WHO norms, along with the attendant increase in manpower – doctors, nurses & paramedics - & a proportionate increase in primary & secondary healthcare centres is thus essential, all under the regulatory norm of “affordable healthcare”. While the public: private sector contribution, in tertiary healthcare can be 50:50, heavy lifting of primary healthcare has to be predominantly led by the govt.

Standardization of protocols is also essential to ensure speedy response, in the light of shortage of trained manpower.

(2)Replicate the successful template of Dr Rajendra Bharud, IAS, District Collector, Nandurbar, a tribal district of Maharashtra

·         Instead of dismantling temporary COVID - 19 facilities, post decline in cases, at the end of the first wave, Bharud, took signals from the surging case load in Brazil & America & prepared for the 2^nd wave by strengthening infra, creatively, putting to use district planning & development funds, state disaster relief funds & CSR (Corporate Social Responsibility).

·         Schools & community halls were converted into COVID - 19 centres – creating 7000 beds for isolation & 1300 ICU beds with ventilators; 27 ambulances were procured to bring patients to the hospital & 2 to move dead bodies. Today despite the 2^nd wave the district boasts of spare capacity of beds providing succour even to patients from neighbouring states.

·         Learning from the 1^st wave experience of shortage of frontline doctors & experts due to lack of medical colleges in the region, he roped in all local doctors & trained them to perform all vital procedures like intubation & monitoring of oxygen levels.

·         As a preventive measure, he initiated rapid vaccination of the 3 lakh, above 45 years old people, of the 16 lakh population, of the district. 1 lakh people have already received the 1st dose, administered vide 16 vehicles, to avoid citizens travelling in the hilly terrains, using teachers & sarpanches as "influencers", to spread word regarding the seriousness of the situation.

·         In Sept 2020, he installed the first oxygen plant in the district, with a capacity of 600 litres per min, even though the highest single day spike was 190 cases only. In Mar 2021 he installed the 2^nd Oxygen plant & in April, when cases started touching 1200, he started preparing to install a 3rd plant, with a combined capacity of 3000 litres per min. Thus while the rest of the country is gasping for oxygen, now transported, in cryogenic containers, from the steel plants, largely concentrated in India’s East, Nandurbar is self sufficient. He reasoned that directly extracting oxygen, from the air, is a cheaper alternative, to shifting oxygen from elsewhere, considering that cylinders are manufactured only in certain states.

·         Oxygen pipes were given as soon as saturation levels start dropping, instead of waiting for the critical stage, as patients use only 30% of oxygen in the first case against 90% in the latter case; it also directly affects the brain & kidney making it harder for patients to recover fast.

·         He created a website & control room to help control panic & guide the citizens to avoid citizens running from pillar to post in search of beds.

(3)Handle Manpower shortage: Dr Devi Shetty, Founder Narayana Health, has highlighted the likelihood of shortage of nurses & doctors, in ICUs, being the next headline, post shortage of Oxygen & Remdesivir is addressed & suggested the following interventions to tide over the crisis:

·         Statistically per every patient tested positive, there are 5 patients positive but untested. Thus 3 lakh per day of positives implies 15 lakh actual positive cases.

·         Assuming 5% of them to need ICU beds means an additional requirement of 75000 beds per day; each patient needs to stay in the hospital for about 10 days. Total ICU beds in India are 75000 -95000 & hence already full. Any bed in a hospital with central oxygen can be converted into an ICU with a few accessories which can be easily procured; doctors, nurses & paramedics are in short supply though.

·         Frontline workers who did a phenomenal job during the first wave are tired & exhausted.

·         Therefore

o   Exemption to the 2.2 lakh nursing students who finished GNM or BSc Training from appearing for the examinations & given preference in a future govt. jobs provided they work in a COVID - 19 ICU for 1 year.

o   NBE & NSE to exempt 25000 specialist doctors & offer a degree if they work in a COVID - 19 ICU for 1 year

o   NMC to recognize medical diplomas in intensive care cardiology or emergency medicine currently unrecognized by the Medical Council to gain access to a few thousand additional resources

o   1.3 lakh doctors are preparing for the 35000 seat NEET examination; attract the 1 lakh unsuccessful ones by offering grace marks for the exam next year provided they work in the COVID - 19 ICU for 1 year

(4)Accelerate Vaccine production:

The US has announced support for “temporary waiver” of Intellectual Property (IP) Rights, for COVID -19 vaccines – not diagnostic kits, therapeutics like Remdesivir & related technologies – unlike the resolution proposed by India & South Africa, in Oct 2020, at the World Trade Organization (WTO), that enjoys the support of over 100 countries. EU, UK, Japan & Switzerland oppose the move though. While this “limited waiver’ is a step forward, the “consensus based” approach, of all 164 members, at the WTO, shall delay the conclusion of the text based negotiations. India & other nations can break the patents anyway under the “compulsory License’ rules. But waiver of IP alone is insufficient, if technology is not transferred to accelerate production; problems of trade barriers & shortages of ingredients remain. “Voluntary licensing” by pharmaceutical majors, of the Serum Institute of India (SII) - Astra Zeneca kind – hopefully at reduced charges– is perhaps the compromise formula that shall be agreed. Since negotiations shall take time, India shall be better advised in accelerating production of SII’s Covishield & Bharat Biotech’s Covaxin.

The govt. has announced Rs 3000 cr. to The Serum Institute & Rs 1500 cr. to Bharat Biotech as a credit advance.

Covishield is expanding capacity from about 7 cr. per month to 10 cr. per month (120 cr. per annum) by July 2021. SII shall also produce 100 cr of Novovax per annum.

Covaxin has expanded capacity from 0.5 lakhs per month to 1.2 cr. per month (14.4 cr. per annum) with plans to expand it further. Since Indian Council of Medical Research (ICMR) holds patent rights along with Bharat Biotech, for Covaxin, the process should be shared with other vaccine manufacturers, in the country to ramp up production. India has a vaccine capacity of 8.2 billion per annum & ideally 50% of the capacity could be diverted to produce Covaxin.

Dr Reddy shall import 12.5 cr. vaccines starting May 2021 while Gland Pharma, Hetero Biopharma, Panacea Biotech, Stelis Biopharma & Virchow Biotech shall produce 85 cr doses per annum starting Q2 21(June-Sept 2021)

Biological E shall produce 60 cr. of Johnson & Johnson’s vaccine as part of a QUAD deal - vaccine funded by the US & Japan, produced in India & distributed by Australia. However, India's aspiration to be a lynchpin of the Quad, stands diminished, struggling as it is to produce vaccines for its own citizens. China, meanwhile, is making inroads into South Asia & beyond at India's expense.

While Pfizer & Moderna have been approved & imports are likely, they shall be constrained by the lack of a cold storage chain & high prices (~$20) & could serve only the creamy layer of the population. Sputnik is sold uniformly at $10 across the world & would have found few takers when Covaxin & Covishield were being sold for $2 apiece; that could explain the govt. allowing Covaxin & Covishied to up prices.

Prudent however for the Central govt. to book 188 cr. Covaxin & Covishield upfront, issue credit for stock to ramp up capacity & continue to offer the jabs at Rs 150 to continue gaining goodwill of the population. 

Conclusion:

Lack of commensurate investments in healthcare, over the last 70 years, is now coming home to roost; focusing on an insurance led model & expecting the private sector to carry the entire burden of upping investments, in tertiary care, is unfair & unattractive when price controls restrict ROI to single digits. Govt. should continue with price controls under the “affordable care” regulatory framework & up public investments, into tertiary care, to be at least an equal partner to the private sector from current 40%. State governments should take the entire load on setting up Primary Health Centres (PHCs) & share burden with the private sector in strengthening Secondary Health care.

While the aforementioned recommendation is a medium term goal replicating the successful template of Dr Rajendra Bharud, District Collector, of Nandurbar, Maharashtra & implementing Dr Devi Shetty’s recommendations on ramping up manpower shortages could help India emerge from the health crisis. Accelerated vaccine production & inoculation, though, remains the key to redemption

How To Satisfactorily End the Indian Government - Farmer Confrontation?

 

The govt. passed 3 farm laws in Sept 2020 & likened it to the 1965 “Green Revolution” in agriculture with a potential to improve farmer incomes while farmers - at least in some parts of the country like Punjab & Haryana – contest the claim & have risen in protest which has since crossed the 100 day mark. A solution to the confrontation is thus called for.

Since Agriculture Pricing Marketing Committee (APMC) was abolished, in Bihar, in 2006, doing away with a comparative price discovery mechanism, leading to a further drop in farm food prices accruing to farmers; the central government, rightly, has only abolished the monopoly of the APMCs by throwing it open to private competition. The model contract farming Act, perhaps, passed with an intention to encourage larger land holdings & hence to attract private investment suffers from certain flaws though; as per Agricultural Scientist Devinder Sharma, the size of an average land holding in US is over 160 hectares & in Australia more than 4000 hectares. If open agricultural markets in US & Europe – in existence for 6- 7 decades had been so benevolent the crisis would not have been so severe as to demand an annual subsidy of $100 billion in Europe & an average US farmer annual subsidy of $60,000 against $200 in India. The new legislation strangely “arranges for a bureaucratic dispute resolution mechanism to the exclusion of civil courts” as per the former Finance Minister P Chidambaram.

Facts on the ground:

(1)Agriculture supports the largest chunk of the workforce at 43%: Agriculture accounted for 69.7% of Indian workforce, of 29.8 cr. in 1951 which dropped to 54.6%, of 48.1 cr., by 2011 & at 43% now substantial to demand attention.  Their precarious position can be gauged from the fact that about 12000 farmers commit suicide every year (As per govt. data 12360 in 2014, 12602 in 2015, 11379 in 2016); loan waivers announced by all parties is a temporary band aid that does not address the root causes.

(2)Low Farm Gate to Consumer Plate Prices: As per a 2019 RBI report the farm gate prices vary between 28% -78%of the retail prices, accentuating a demand for disintermediation to improve farmer incomes. Traders & Retailers mark-up is higher for perishables indicating the urgent need for improving cold storage facilities to reduce waste. As per the Central Institute of Post-Harvest Engineering & Technology (CIPHET), 18% of fruits & vegetables in India rot due to unavailability of storage while there are other studies that peg the fig. closer to 40%. The sector is clearly crying out for investment.

(3)Predominance of small farmers impedes price negotiation: 86% of Indian farmers have less than 2 hectares of land that accounts for 47% of total cultivable area (Agricultural Census 2015-16), indicating limited negotiation capacity, for small & medium farmers,  in the absence of Farmer Producer co-operative structures (FPO) that build successes in the milk movement, under brand Amul . But political capture of the co-operative movement for sugar, milk & financial services does not inspire confidence.

	Total Holdings
Area in Hectares	Number		Area
Below 0.5	70468756	48.1%	16472957	10.4%
0.5-1.0	29782553	20.3%	21450395	13.6%
1.0-2.0	25809332	17.6%	36150710	22.9%
2.0-3.0	9827676	6.7%	23374741	14.8%
3.0-4.0	4165538	2.8%	14244565	9.0%
4.0-5.0	2366241	1.6%	10457933	6.6%
5.0-7.5	2352020	1.6%	14146575	9.0%
7.5-10.0	843219	0.6%	7205918	4.6%
10.0-20.0	693375	0.5%	9066527	5.7%
20.0 & ABOVE	145031	0.1%	5247011	3.3%
ALL CLASSES	146453741	100%	157817336	100%

 

As per the agricultural census 2015-16, the average size of operational land holdings reduced from 1.15 hectares in 2011-12 to 1.08 hectares in 2015-16; sane to presume that it has reduced further to about 1 hectare (~2.5 acres in 2020-21). Therefore, with an average profit of Rs 15,000 per acre (Rs 30,000 across 2 crops of Kharif & Rabi) an average farmer makes Rs 75,000 per annum barely sustainable for an average family of 5.

Since Income under 5 lakhs, attracts no tax farmers upto a land holding of 16.66 acres are protected. While there have been demands to tax farming, pertinent to note that only 1.2% of farmers have land holdings in excess of 7.5 hectares (~18.75 acres) & that explains why no governments has tried to tax the ~ 15 lakh “rich farmers” since it is a political hot potato; they have instead rightly tried to tax them by tracking sale of premium cars & gold purchases.

(5)India offers low MSP & no produrement support for about 20 products: India offers lower MSP than comparable contries except Vietnam & hence there is scope for enhancing same even while working at disintermediation.

GOI releases MSP for 23 products – 7 cereals (Paddy, wheat, Maize, Sorghum, Pearl Millets, Barley & Ragi)  5 pulses (Grams, Tur, Moong, Urad, Masoor) 7 oilseeds (groundnut, Rapeseed & mustard soyabeen sesamum sunflower seeds, , nigerseed, , safflower) & 4 cash crops – cotton, jute, sugarcane, copra & de-husked coconut) but procurement by FCI is done only for rice, wheat & partially for cotton & some pulses. Bereft of a procurement mechanism, MSP on the remaining products is a farce allowing private players do secure products at 15-20% lesser than the MSP announced.

Lured by procurement support farmers have overproduced water guzzling crops like rice & wheat unlike millets & sorghum depleting the water table demanding a correction to be effected in cropping patterns. As per the PRS Legislative Research data India consumes about twice the water to produce a unit of output demanding the use of drip & sprinkler system.

As per capita incomes of societies increase, the consumption of proteins – pulses, eggs, milk, meat etc. – increases & Indian food inflation during the last 2 decades was on account of such shortages indicating the need to demarket cereal production & incentivize pulses & oilseeds production

(6)Agricultural Trade Disputes on the rise: Countries like US & Canada have dragged India to the dispute resolution mechanism under the World Trade Organization (WTO) on subsidies on rice & wheat; likewise, Brazil, Australia & Guatemala on sugar subsidies. As per WTO mandate, agricultural subsidy cannot exceed 10% of the value.  Input subsidies like free water, electricity, subsidized fertilizers & MSP have been cited as the villains by the complainants who are demanding reduction of the same & opening up of agricultural markets & India might have to opt for some compromise as way forward if it wants a rules based international trade order - that has served it well - to prosper. This shall impact farmers.

As per the Food & Agricultural Organization of the United Nations, India is the 2^nd largest producer of rice in the world,  but the largest exporter with over 25%% market share (Global Market of 40MT) & growing share further might not be easy.  Increase in production worldwide led to price pressures because of which 2018 prices were nearly equivalent to those in 2009 indicating the urgent need for India to change cropping pattern away from rice.

On wheat India faces quality issues & lack of competitive advantage due to relatively higher MSP as compared to formidable competition from Australia, Ukraine, Russian Federation & US. While global wheat trade is 170 MT per annum, India exported about 5 lakh tonnes in 2019-20 largely to Nepal (~2 L tonnes)

As per US FA during the year 2019-20 India is expected to produce 112 MT of Rice & consumes 102 MT while producing 100MT of wheat consuming 91.5Mt & using 5.5MT as feed.  Thus India can afford to increase wheat production, but by rationalizing MSP, to help export competitiveness while there is a need to shift away from rice production. Incidentally, rice is produced across the country while wheat is produced predominantly in the North & Central region. Productivity of wheat in Punjab/Haryana is comparable to the global figs. while lower irrigation facilities impedes production in the drier central region; need for producing region specific seeds to enhance productivity.

Need for Rationalizing subsidy: Fertilizer subsidy of about Rs 75000 cr per annum on nitrogenous (N) fertilizers – urea - & none on phosphorous(P) & Potassium(K) has led to excessive usage of N shifting N:P:K ratio to 6.1:2.46:1 in 2017-18 against an ideal 4:2:1. The Shanta Kumar Committee therefore, recommends removal of subsidy & direct benefits transfer (DBT) at the rate of about Rs 7000/ hectare.

Understanding the interests of the 4 stakeholders - the government, Farmers, Consumers & the private sector -  in this policy document shall help chalk out an agreeable compromise.

(a)The govt. spends more than 2 Lakh cr. every year in Food Subsidy – to provide food to 66% of Indian population under the Food Safety Act 2013. Rice & Wheat are procured by the Food Corporation of India (FCI) & sold at a subsidized rate to the beneficiaries; the difference is the subsidy, which the govt. passes to the FCI albeit with a huge delay, consequent to its weak finances, pushing the organization into the Red. Furthermore, while the buffer stock required is 41.1 million tonnes on 1^st July every year to cater to any famine/drought situations & targeted Public Distribution System (PDS) needs, FCI godowns are overflowing with stocks, more than 50% of those set limits,  due to the political pressure on procurement. Short of space, FCI has been stocking up in the open, exposing stocks to rain gods & consequently selling rotten stock to breweries at a huge discount. Govt. thus is right in exploring ways to rationalize subsidies & making FCI operations efficient.

(b)Farmers accounted for 43% of the Indian workforce but contribute only about 15% of GDP (Gross Domestic Product); clearly, most of them are poor & would do well with a hike in the Minimum Support Price MSP). If the govt. genuinely wants the improvement in farmer’s incomes why are they loathe to make MSP a “legal right” i.e. even private sector cannot procure at less than MSP?

(c)Consumers want an anaemic increase in MSP so that inflation is kept in check & savings thereof can fund their other consumption splurges.

(d)The private sector, answerable rightly to their shareholders, would not want MSP as a legal right, as it is an impediment to maximize profits.

The interests of the farmers are thus is opposition to the govt., consumers & the private sector & that explains the conflict. But mere slogans of “Jai Jaiwan, Jai Kisan” do not help when budgets for both are either slashed or experience a yearly increase that barely covers inflation.

The Way forward:

The govt. needs to improve farmer incomes through concrete action rather than assuming that the entry of the private sector shall automatically usher in prosperity. The policy however should be WTO compliant that mandates that agricultural subsidy cannot exceed 10% of the value. Reduction of procurement by FCI is necessary to pull the organization out of the red. With per capita incomes under pressure, an increase in agriculture production cannot be absorbed in India & export markets, since 2012, have experienced anaemic growth. India became the largest producer of sugar in the world, last year but found it difficult to sell the excess production despite the loss of crop in Brazil. 

Therefore:

(1) Replace MSP with Input subsidy so that farmers produce what the market can absorb:

(a)Direct benefits transfer of the Rs75000 cr. fertilizer subsidy at Rs 7000/ hectare (Rs 2800 per acre)

(b)Since FSA mandates 75% of rural & 50% of urban population as beneficiaries, sane to assume that most of the land owning farmers & agricultural labourers, in rural shall fall into the beneficiary’s category. DBT of the food subsidy at about Rs 7500 per family (Rs 25/Kg X 5 Kgs/Month X 5 persons/Family X 12 months) which translated into ~Rs 3000 per acre - assuming an average holding of 1 hectare per family.

This is borne out vide the Shanta Kumar Committee recommendations; In 2013 cost of rice procured was Rs 20 & sold at Rs 3 to the beneficiaries of the Food bill incurring a subsidy of Rs 17/Kg. The logistics & storage costs were Rs 10 extra & hence the resultant subsidy was Rs 27/ Kg (Rs 30 – Rs 3). DBT of Rs 22/Kg - as part of the food bill - to the bottom 40% of the population, instead of 67% of the population (75% of rural & 50% of urban); issue wheat & rice at 50% of MSP for non-Antyodya households.

(c)Continue PM KIsan of Rs 6000/- (Rs 2400 per acre)

(d)States to replicate the Telangana Ryutu Bandhu scheme of providing an input subsidy of Rs 10,000 per acre.

These figures add up to Rs 17200 (Rs 8,200/- per acre by the central govt. & Rs 10,000 per acre by the state govt.)- about 60% of the current profit of about Rs 30,000 per acre secured by the farmer annually across 2 crops.  

(2)Launch Farmer Markets in Urban centres to reduce intermediation to enhance farmer incomes: There are some best practices of states worth a national replication. Ryathu Bazaar of undivided AP or Uzhavar Sandhai of TN – where farmers sell directly to consumers in designated spots at urban centres - have found that farmers secure 15-40 % more than wholesale prices & consumers pay 15-30% less (GOI 2011 RBI report 2019)

(3)Launch Farmer Co-operatives to help in collective bargaining: The govt. wants the creation of 10,000 farmer co-operatives & promised credit of Rs 1lakh cr. vide National Bank for Agriculture & Rural Development (NABARD) to build agricultural infrastructure; Intent is welcome but challenges in execution persist

(4)Nudge farmers to diversify Income streams: Ultimately, doubling of farmer incomes needs diversification of farmers into horticulture, poultry & animal husbandry.

(5)Need to shift workforce from agriculture to manufacturing & services:  Agriculture accounts for 15% of GDP but employs 43% of the workforce alluding to low productivity. Govt. should accelerate efforts at shifting at least 15 cr. farmers into manufacturing – especially labour intensive leather, footwear, toys, textile etc. - & service sector jobs. Landless labourers should perhaps be the first focussed group.

Conclusion

Protecting 43% of workforce, surviving on agriculture, is a must without sacrificing the inflation concerns of 100% of the consuming population & the necessity of pulling the FCI out of the red. Replacing MSP with input subsidy, disintermediation by launching farmer markets in urban areas, nudging farmers towards sustainable agricultural practices away from producing water guzzling crops like rice, wheat, sugar, etc. in favour of oilseeds, pulses, fruits & vegetables etc. - currently in short supply - & incentivizing farmers vide banking loans into diversifying income streams by starting horticulture, animal husbandry, poultry etc. is a beneficial way forward. Finally, India has no option but to arrange for shifting a majority of the farmers into manufacturing & services or else stare at a demographic nightmare. Since agriculture is a “state” subject, a consensus driven equal contribution approach by both the centre & the states can help execute the aforementioned solution. The clock is ticking.

The India, China & Pakistan Bilateral Peace Overtures – the Crux

The Feb 10^th 2021 announcement on “synchronized & organized “Indo-China disengagement, from the North & South banks of the   Pangong Pso - in line with the consensus reached, during the 9^th Corp commander level talks, on Jan 24^th, with the region between Finger 3 & 8 temporarily becoming a no patrolling zone & removal of all constructions, since April 2020 – potentially, brings to an end a 9 month standoff.  Indians holding the commanding heights on the south bank of the lake, threatening the Chinese Moldo garrison, facilitated a compromise while the lack of a similar bargaining chip prevents Indians for effecting a similar Chinese withdrawal at the other friction points – Gogra, Hot Springs & Depsang. Chinese advantage at these points  threaten the DSDBO Road (Darbuk Shyok Daulet Beg Oldie Road) the lifeline to the critical Indian SSN (Sub sector North). Status quo ante, at these locations, is thus a mirage & likely loss of territory & “trust deficit” permanent. Sino-Indian relations, inevitably, shift from an era of “strategic competition” to “strategic rivalry”- the contours of which shall become more visible in the 2^nd half of the 21^st century.

Soon enough, on Feb 24^th, 2 days before the 2^nd anniversary of the Indian Balakot attack, a Joint statement was released by the Indo-Pak DGMOs (Director General of Military Operations). Such bonhomie, in quick succession, did evoke a considerable surprise. This statement alludes to respecting the Vajpayee-Musharraf LOC (line of Control) & IB (International Border) agreement, of 2003, & addressing “each other’s core concerns which have the propensity to disturb peace & lead to violence”. The “core concern” of Pakistan (Pak) is “Kashmir” while for India is “terror” & obviously, it is unlikely to find common ground.

Subramanian Swamy, the BJP’s rebel with a cause, has a point, when he tweeted: “Now you know the catch in the agreement.  Will we give up POK? Help Baluchis? Give autonomy to J&K? Scrap CAA? Or Pak will say we have broken the agreement” On the contrary, Swarajya, with its right wing slant opined that Pak facing the prospects of the likely drying up of  US aid - as the Afghanistan war nears conclusion - & the bitter experience of not finding support from the Gulf countries, on Kashmir, must have decided to follow a non-zero sum game. It is, however, more likely that the US forced the hand of both nations.

The Indo-Pak Detente

Avinash Mohananey, Ex Intelligence Bureau (IB), in his Economic Times article, suspects that the first policy statement of the US Joe Biden administration released on 4^th Feb 2021, on countering the growing ambitions of China to rival the US” & “determination of Russia to damage & disrupt our democracy” & keenness to restore the habits of rebuilding the muscle of democratic alliances, that had atrophied, heralds the genesis of a new cold war. While the Indian tilt towards the US is visible, the US must have initiated steps to woo Pak out of a tight China embrace, to aid its troop withdrawal from Afghanistan with the promise of Kashmir on the table when talks resume.

 The following sequence of events justifies the interpretation:

2^nd Feb 2020: Gen Bajwa’s calls for a “dignified & respectable solution as per the aspirations of the people of J&K” 

5^th Feb 2020: Imran Khan says that Pak is ready for taking 2 steps forward if India takes one. On the same day India restores 4G telecom connectivity in entire J&K – frozen since Article 370, was written down, in Aug 2019.

11^th Feb 2020:  Statement by Moeed Yusuf, special advisor on National security & strategic policy planning to Pak PM: “If we want peace, we have to move forward;” & “everybody has to be rational not ideological”.

25^th Feb 2020: US spokesperson Jen Psaki welcomed the agreement “which is in our shared interest & we encourage both countries to keep building upon this progress”.

Musharraf Zaidi, a Pak commentator, too, subscribes to the view that this deal has the blessings of the Western powers.

The immediate “tactical” advantages on offer:

(a)Afford Pakistan leeway to partially redeploy its forces back to FATA from the Indian borders as per Michael Kugelman- Deputy Director of the Asia Program at the Wilson Centre.

(b)Help the BJP concentrate its efforts on the impending state elections at Bengal, Tamil Nadu, Kerala, Pondicherry & Assam.

As per Ambassador Vivek Katju, an opening to normalize relations with India has eluded General Bajwa till date. The FATF (Financial Action task Force) pressures, crippling the Pak economy & the advantage of cooling the Indian borders, to play an end game, in Afghanistan, post the US withdrawal may have influenced his thinking. Just as India is not keen on a “hot border” with China as the latter is 5 times its economic size, Pak too could have calculated the costs of fighting India 10 times its economic size. Prof Happymon Jacob, of the JNU (Jawaharlal Nehru University) says that the Indian govt. too must have realized that a state cannot be run on escalatory rhetoric alone.

“History repeats itself, first as a tragedy, & then as a farce” said Karl Marx & the Indo-Pak relations have followed that template dutifully. The DGMOs, of both nations, made a similar promise, in May 2018, to respect the 2003 ceasefire pact in “letter & spirit” only to witness its violation immediately thereafter. Furthermore, Imran Khan, since the last 1 year, has been accusing Prime Minister Modi of fascism & the latter who takes his international image too seriously would not have taken it kindly. Similarly, as per the Indian Home Ministry, Pak ceasefire violations increased from 2140 in 2018, 3479, in 2019 to 5133 incidents in 2020; considering the huge upside, in 2020, it is safe to interpret that the increase, coinciding with the Indo-China Ladakh skirmish, proves yet again that Pak is a satellite state of China, more so after CPEC (China Pak Economic Corridor). Therefore, it is reasonable to factor in a ‘trust deficit” & the unlikelihood of the resumption of people to people contacts or trade – which anyway is meager, & gets, largely, routed through the UAE otherwise. India must, therefore, forever, be ready for a 2.5 front war - first enunciated by CDS (Chief of Defence Services) Gen. Bipin Rawat. The 2 fronts are China & Pak while the half refers to the internal secessionist forces operating within the Indian borders.

Takeaways from the Indo-China conflict

(a) The Indian side was led by Lt. Gen PGK Menon, Commander XIV corps – responsible for the LAC in Eastern Ladakh & Navin Srivastava, Additional Secretary (East Asia), Ministry of External Affairs, while the Chinese side was led by Major General Liu Lin – Commander of the South Xinjiang Military region. A Major General is one level below a Lt. General & hence a protocol violation, implying that China do not consider India an equal. India, prudently, should have downgraded the level of talks to that of a Major General & absence of such an action is perhaps, a quiet acceptance of the power differential.

(b)The Indians lack a bargaining chip to force a compromise from the Chinese in Gogra, Hot Spring & Depsang plains. Why did the Indians not occupy similar strategic areas - as they did in Pangong along the aforementioned areas, or elsewhere, along the 3488 Kms border- to force a Chinese compromise; is the power differential inducing caution?

(c)The DSDBO road took 20 years to complete & now India has to invest on an alternate route since this road is within the shelling range of the Chinese artillery.

 (d)The raw courage displayed by the Indian soldiers at Galwan, on June 15^th 2020, which led to the death of 20 Indian & 45 Chinese soldiers– as per the Russian agency Tass, even as the Chinese claim only 4 casualties – implies that the Chinese, going forward, are more likely to avoid a physical confrontation, but could employ use of either

(1)their technological superiority in the Cyber, space & electromagnetic domains to force Indian compromises OR

(2)Use the clause VIII in the 2005 agreement on the “guiding principles for the settlement of the India-China boundary question” which reads thus: “in reaching a boundary settlement, the two sides shall safeguard due interests of their settled populations in the border areas.”  China shall build new civilian settlements, in disputed border areas, as they have done at the Tsari Chu basin, Arunachal Pradesh & in Bhutan, recently, to achieve a fait accompli. 

(e)China share borders with 14 countries & they have settled them, largely, with 12 countries except India & Bhutan. Sun Yun, of the Stimson Centre, predicted that China is unlikely to settle the border with India since an Indian promise of neutrality in the emerging Sino-US conflict - even if made as part of a grand bargain on border settlement - can be violated by India while the boundary line, once marked, shall remain permanent. Expect China, therefore, to continue needling India to

(1)Force Indian troop concentration away from the Indian western border to protect “iron brother” Pakistan

(2)Weaken the emerging QUAD – the US-Australia-Japan-India – alliance, that largely is maritime focused.  Pressure on Indian land borders shall force India to spend more on the Army & less on the Navy – offering China space to strengthen itself even in the Indian Ocean, helping it expand beyond its traditional area of dominance in the Western Pacific.

Conclusion:

China, Pak & India entered into ,bilateral agreements aimed at cooling tensions, at the borders. While China now wants to focus its energies on the likely moves of the new Joe Biden US administration, either the US or China must have forced the Indo-Pak reconciliation.

While China has extended its control onto territory coinciding with its 1959 claim line & signaled to India to defer to its power superiority & put on notice, other nations, who wanted to prop India up either as a countervailing force to China or were hedging their bets. Having achieved both the objectives they have acceded to the disengagement in Pangong Pso – to eliminate the threat to their Moldo garrison even as they hold sway over Depsang, Hot Spring & Gogra. India is forced to pay the cost of creating an alternative to the DSDBO road - that now stands compromised. Shifting of resources to the Army would reduce the Navy's outlay & the effectiveness of the QUAD – which has more of a maritime significance - thereof. China now gets ready to engage the Joe Biden administration, perhaps, cooperate on climate change in lieu of reduced trade tensions - to prevent the success of the China+1 corporate strategy, of de-risking concentration of supply chains in China - which otherwise has the potential of strengthening countries in its neighborhood  like India, Vietnam, Indonesia etc. They shall be ready with a counter to the likely nit-pricks on human rights violations & suppression in Tibet, Xinjiang, Hong Kong & Inner Mongolia & further arms sales to Taiwan.

Pakistan would use the deal to partially shift forces from the Indian border to FATA to suppress internal revolts & play the end game, in Afghanistan, coinciding with the US troop withdrawal, to prop up the Taliban to power. They would be keen that US & China pressurize India, to resume the comprehensive dialogue – that puts Kashmir on the table; resumption of  people to people contacts or trade are less likely & even if agreed to only add up to signalling alone. Supplies of Covishield, from India, supplementing Sinopharm, from China, could help with their vaccination efforts; India could acquiesce to such a request.

India could be relieved with the reduction of tensions with China even as the BJP sparks a counter narrative to the opposition accusation on loss of territory- a likely issue in the impending elections across 5 states. Thaw in relations with Pakistan for the govt., though, could be a temporary tactical retreat as escalatory rhetoric with its western neighbor has yielded impressive electoral dividends. Despite the new administration identifying both China & Russia as enemies, India could be keen to continue engagements with Russia – despite it being in a Chinese embrace – as over 60% of Indian military equipment is of Russian vintage needing spares & supplies as well as to prevent Russian equipment from being supplied to arch rival Pak. She would relish a situation where the Sino-US cold war escalates & accords India an opportunity to play a “swing power” – securing concessions from both sides in lieu of neutrality thereby ring-fencing “strategic autonomy”. But it is easier said than done; patient building of economic & military muscle over the next 15 years is the key to Indian strategic ambitions.