Nobel laureate Abhijit Banerjee describes India’s COVID-19 lockdown
Nobel laureate Abhijit Banerjee has said the nationwide lockdown imposed by the Indian government last year to contain the spread of COVID-19 infections, and the resulting migration of poor people from cities to their villages by walking hundreds of miles on foot , was a “pure plumbing company”. failure”.
Banerjee and Esther Duflo, Nobel laureate economist and Banerjee’s wife, have often compared the countries’ economic systems to sanitation systems.
“There may be as many as 50 million… low-income migrants temporarily living in cities. They can’t connect to the social security system. That’s why there were photos in the first lockdown of people walking 1,000 kilometers… there wasn’t any way for them to survive. They just had to go home. That’s pure plumbing failure,” Banerjee said of India’s lockdown in an interview with the Financial Times.
Banejee quoted the migrants in cities as being unable to take advantage of the government’s welfare scheme there, saying India is an example of a country where they had not thought about their sanitation.
The MIT professor said loan default will be a major problem for the countries to deal with after the pandemic, and praised the measures India has taken in this area.
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“Where the countries are obviously going to hurt is dealing with defaults. India – all it did – is in fact allowing some degree of loan restructuring, which was subsidized by the government. Other countries didn’t even have those resources, ” he said.
He also supported the International Monetary Fund’s decision to reallocate special drawing rights (SDRs) and help poor countries raise money to fight the pandemic and cope with its consequences. Banerjee said this could prove to be a very useful tool for bringing liquidity into the economy.
“I would like to reinforce the point about the drawing rights because that is a very important discussion. It would allow the world to do what the rich countries could do for themselves, which is squeeze some liquidity not to fund their long-term development. in the short term, but tackling this crisis in the short term,” said Duflo.
SDRs can also be used to fund emergency money transfers, she added.
On the impact of the COVID-19 pandemic and lockdowns, Duflo said that while its economic impact cannot be predicted, some of the issues, such as pause in child immunization programs in several countries, lack of schooling for children for more than a year and families pushed back down the poverty line can have long-lasting damage.
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