‘Our relief package is as large as your country’s GDP,’ India reacts to Imran’s offer to share Ehsaas project

— Islamabad regrets negative remarks by New Delhi regarding goodwill suggestion by PM Imran

In a stinging reply to Prime Minister (PM) Imran Khan’s offer of sharing with India his government’s cash transfer project technology to help the poor amid the coronavirus crisis, New Delhi has said that the size of its economic relief package during the pandemic is as large as Pakistan’s Gross Domestic Product (GDP).

“Pakistan would do well to recall that they have a debt problem which covers 90% of their GDP. As far as India goes, our stimulus package is as large as the GDP of Pakistan,” said Anurag Srivastava, a spokesperson for India’s Ministry of External Affairs (MEA), on Thursday.

Imran had earlier in the day tweeted a news report published in an Indian daily highlighting the suffering of a section among the poor in India due to the economic challenges posed by the COVID-19 outbreak, saying that his government was willing to help with its successful cash transfer programme, which he boasted was recognised internationally.

“I am ready to offer help and share our successful cash transfer programme, lauded internationally for its reach and transparency, with India,” the premier had said while sharing the report as per which 34 per cent households across India will not be able to survive for more than a week without assistance.

He had said his government successfully transferred Rs120 billion in nine weeks to over 10 million families in a transparent manner to deal with the economic fallout of the virus.

ISLAMABAD REACTS TO NEW DELHI’S RESPONSE:

In response to New Delhi’s reaction to the premier’s offer, the Foreign Office (FO) regretted “negative remarks by the MEA spokesperson regarding a goodwill suggestion by the PM to share Pakistan’s successful experience in ameliorating the impact of COVID-19 on the poorest sections of the society”.

“Remarks by the MEA spokesperson reflect an unprofessional attempt at point-scoring over a serious issue that involves the lives of millions of poor people in the subcontinent, worst affected by the COVID-19 pandemic,” read a statement issued by the FO on Friday.

THE REPORT:

A study titled “How are Indian households coping under the COVID-19 lockdown? Eight key findings”, carried out by experts at the University of Pennsylvania, the University of Chicago and the Mumbai-based Centre for Monitoring the Indian Economy (CMIE) reveals that nearly 84 per cent of Indian households are seeing decreases in income since the lockdown began. Nearly a third of all households will not be able to survive beyond a week without additional assistance.

“Direct and immediate transfers of food and cash are a very high priority,” said Heather Schofield, assistant professor of medical ethics and health policy at the Perelman School of Medicine and a Wharton professor of business economics and public policy.

When a nationwide lockdown began in late March, India’s Ministry of Labour and Employment asked private and public organisations not to terminate jobs on the pretext of prevailing conditions. But these pleas hardly made any difference and large-scale retrenchments that took place as cope with the contagion.

However, the study found a “sharp and broad negative impact on household income” as the pandemic diminished their staying capacity, adding that the unemployment rate in the country had crossed 27 percent in early May, up nearly four-fold from levels in January-February.

The fall in incomes affected people in the lower and middle segments of the income distribution most severely, the study found. “Households in the lowest of the five income groups had average monthly per-capital earnings of less than Rs3,800 (about $50), while those at the high end made between Rs12,374 and upwards of Rs100,000 ($167 to $1,370 and more).”

Households in the middle-income groups are hurt disproportionately more perhaps because they are most likely to be dependent on sources of income that are hit due to the lockdown, the study’s authors stated.

Rural households have seen disproportionately more distress than those in urban India during the lockdowns. Incomes have fallen at some 88% of rural households, compared to 75% of urban households, the study found.

Only 30% of households are able to survive one month or more without additional assistance. “Crucially, 14% of the sample is already out of funds and risks immediate and severe deprivation if they are unable to borrow or receive additional benefits,” the report warned.

“Rapid distribution of in-kind or cash transfers is needed to prevent a sharp increase in malnutrition and severe deprivation. Such transfers will also likely promote a more robust recovery as the country is able to reopen.”

The need for additional resources is also affected by where the household is located. “The urban poor have the least time before their resources are depleted,” the study said.

Nearly two-thirds of urban households that earn less than median income households will run out of resources in two weeks. Rural households in similar income groups have relatively more resilience, the study found, as 54% of them have sufficient resources for the same period of time.