Prevention is better economics than responding to the post-pandemic outbreak

By Prof Santosh Kumar, NIDM

China, seeing the need has doubled the production of items leading to prevention of corona virus. On the other hand, India is facing shortages of each item. The needs of the service providers (doctors, nurse, health workers) are the first to be provided all these items. Govt of India can encourage start-ups to produce these along with the medicine under the make in India project of the Prime Minister.

I had written an article on 24th of February (Corona Disaster: Lessons from China India Can’t Afford to Do Business As usual https://bit.ly/38Vkhil) on the coronavirus when the number of countries reported hit by coronavirus was 29.

Today, if we take the global status the number has gone up to 85 almost 200 percent increase. It is getting doubled almost every week.

As per the ‘Economist’ over 95000 cases and 3200 deaths have been recorded. Now it has started pinching economy globally. It has also said that the global economy growth in the year 2020 will not be more than 2.9 % due to Covide-92. This week, The World Bank has made US $ 12 billion and the IMF $50 billion for Covid-19.

The US Congress is allocating $8.3 billion in funding for fighting Covid-19. Many advisories are coming from across the globe such as the closure of big gathering and avoidance of mass congregation.

Travel cut, Flights are getting grounded, people are avoiding going to malls, market, restaurants, closure of workshops and seminars, closure of import/export will have a multiplier effect and it would create a serious impact on the economy. China could contain the outbreak by strict enforcement of preventive care.

If citizen has been advised to wear mask they do not have any choice but follow the direction given by the state. WHO team visited and reviewed the implementation.

The top-down approach of the implementation of stringent measures taken have worked well. Iran is totally opposite in controlling or taking stringent measures as number of affected are increasing on a daily basis.

India has a large number of poor population. Economics of prevention is not in their favour. Poorest of the poor are highly exposed and they cannot afford prevention. One that they are bound to go out every day for earning their livelihood hence voluntary confinement will not work. Secondly, suggested preventive measure N95 mask cost is INR 500-2500 in the market.

Sanitizer now scarce in the market is costing more than INR 200. If we assume, average family size is 5 then preventive cost of an individual family will be more than INR 6-8 thousand per week. Hence the probability of getting affected, in the absence of quarantine, is very high.

Ministry of Health guidelines released last week also do not provide any strategy for providing preventive financial support system to the weaker sections. So, if it breaks out it would be difficult to stop.

Better economics is needed. Hence disaster preparedness measures should focus on them who have the high probability of getting affected.

State exchequer should also be planned to be spent more on quarantining them and their surroundings as they also do not have enough money or resources. The Sensex, share market, trade-in India has already started crashing. Thailand, Singapore, South and North Korea have stopped export of mask, sanitizers.

China, seeing the need has doubled the production of items leading to prevention. On the other hand, India is facing shortages of each item. The needs of the service providers (doctors, nurse, health workers) are the first to be provided all these items. Govt can encourage start-ups to produce these along with the medicine under the make in India project of the Prime Minister.

Currently, as per the NITI AYOG Report 2019, the majority of the health expenditure is going in the hands of the private health care system which is expensive and unaffordable to the poor people. Poor people will land up in a debt trap or in poverty. Severe fragmentation, compounded by market failures and governance challenges; act as a vicious circle driving low health sector performance.

The Govt of India is taking initiative for strengthening the health system by taking a comprehensive view.

Under the National Health Mission (NHM), the recent roll-out of Ayushman Bharat — with its twin components of the Health and Wellness Centres to provide comprehensive primary and preventive care at the community level; and the PM Jan Arogya Yojana (PM-JAY) with its Rupee 5 lakh health cover to the bottom 40 per cent of the population for secondary and tertiary care against 1350 odd disease conditions — has laid down a solid foundation on which a good health system can be crafted.

This could be very effective in fighting both preventive as well as post corona impacts on the poor. Health insurance has been taken by not more than 35% of the population. 

So, we need to look at some innovative way and financial mechanism of quarantine the poor. If it is neglected or overlooked, result could be devastating. China enforcement for contacting the pandemic worked well. Same is true with Singapore who could plug it.

Whereas the US and Iran and other affected countries are not adequately equipped and stringent enforcement. As The economist, quote China has given new curriculum to the World that pandemic could be prevented.

In September 2017 Mexico’s was hit by a severe earthquake killing a large no of people and damaged huge property. The quake also affected the “catastrophe bond” holders issued by the World Bank almost a month before the quake.

The money was paid to the government of Mexico to help to rebuild, after it got established as catastrophic earthquake. Similar attempts could also be tried in case of pandemic too. The World Bank sold $320 million worth pandemic bonds on behalf of the 77 poor countries that it serves.

The other issue is of funding corona disaster response in case of prevention and its outbreak.

As US Govt has activated its disaster relief funds and allocated billion as its contingent liability, Govt of India and the state government may think of activating it for the prevention.

The economics of prevention will be much benefitting than waiting for the response. National Disaster Response Fund and State Disaster Response Force (now NDRMF & SDRMF) could also be activated for supporting and enforcing prevention to avoid catastrophic situation.

Prime Minister is himself monitoring the situation on a daily basis. Such high-level intervention is the need of the hour for building the confidence of the people in governance and also preventing the outbreak.  Prevention is better economics than responding to post-pandemic outbreak.

To conclude, I would like to underline the following points.

First India’s efforts should be applauded that all precautions have been taken for contacting the spread.

Secondly, it is being monitored at the highest level (PMO) on a daily basis.

Thirdly, despite of being complacent, India should enforce stringent measures for preventing the pandemic.

Fourthly, Protection of poor people should be kept on priority as they are highly exposed to open environment.

Fifthly, avoidance or complete ban for at least one month from now of mass congregation – Temple, Mosque, Gurudwara, churches etc., workshops, seminars. 

Sixthly, preference should be given for work from home or paid leave in the affected areas.

Seventh, activation of disaster response funds for preventing a pandemic.

Eighth, maintaining the supply chain to avoid scarcity of items helping prevention to treat manpower and citizens and lastly, for the future, insurance products could also be thought of as a risk transfer mechanism for pandemic too as it is being done in agriculture and earthquake etc. 

(Note: Views expressed in this article are personal views of the author and it doesn’t reflect his official views.)

(Prof. Santosh Kumar, Ph.D. Professor & Head of Governance, Policy Planning & Inclusive DRR, National Institute of Disaster Management( Ministry of Home Affairs, Govt. of India) Formerly, he was the Director, SAARC Disaster Management Centre; Executive Director, (I/C) NIDM, Disaster Management Specialist, The World Bank. He has also worked as Professor & Head, Centre for Disaster Management, HCM RIPA, Jaipur, and Deputy Director, Research, UP Academy of Administration, Nainital. https://bit.ly/2KRPQRd Contact- profsantosh@gmail.com, Twitter; @NdmProfsantosh)

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