The Exodus of the ‘Invisible’ and ‘Marginal’ Drivers of the Informal Economy

The Exodus of the ‘Invisible’ and ‘Marginal’ Drivers of the Informal Economy

At 8:00 pm on 24th March, 2020, Hon. Prime Minister Narendra Modi announced a nationwide lockdown to combat the deadly COVID-19. All commercial activity was curbed and citizens were ordered to stay at home at all times. It has today been nearly two months since, and life seems to be getting back to normal. But not for everyone.

The migrant exodus – walking through the crisis

Akin to any other disaster or crisis, the pandemic has impacted the poor the hardest in India. With the abrupt shut down in all economic & commercial activity, millions of migrants who migrated to cities from the hinterlands in search of a better life and opportunities – living a hand-to-mouth existence on a daily basis – were caught unawares as they found it impossible to make ends meet. On top of that, their only other option to return home has also been unavailable due to non-availability of air, rail, or road transport.

Desperate and helpless, everybody from the daily wage workers at construction sites, maids, your local chai wala, your driver, the local electrician and many more who form the unorganised sector in India – are today walking, cycling or hitchhiking for thousands of kilometers with kids, pets, luggage in town, some bare-feet and starving, without any amenities or support.

The way ahead

With the migrants completing their journeys and reaching their home states, they will need jobs to earn a living. Anticipating this, as part of the COVID-19 relief package, the government has announced the allocation of an additional Rs 40,000 crore to MGNREGA to provide employment boost. However, mere government support may not be enough to support the country’s 45.36[1] crore migrant population.

Role of the private sector in aiding the migrants

As some of these migrants return from years of living in the cities, they have acquired skills and are capable of being self-reliant rather than looking for jobs. It is likely that these people will put their skills to use and start micro enterprises or something akin, for which they will need access to finance. Being ‘new-to-credit’ and mostly cash-reliant, it is impossible for them to avail credit from banks.

This is where the private sector can lend a hand to the ‘new-to-credit’ population. New-age lending businesses today offer alternative sources of credit and loans to people who may not be eligible for bank loans in any form. Alternative or unsecured lending is expected to see a rise in demand from all strata of the society, especially the migrant population.

The silver lining

In light of a halt in globalisation due to COVID-19, the government is actively propagating the concept of self-reliance via Atmanirbhar Bharat. The idea relies on economic self-sustenance by promoting and utilising local products & services, and industries. In alignment with the government’s vision for a self-reliant economy, starting up of local businesses by migrants may just as well be the silver lining in this dark cloud of reverse migration.

It is therefore the responsibility of both the public and the private sector to support this vision by providing easy access to liquidity via funds and sources of credit to the migrant population. Not only will this help with financial security and relief to the people who are just coming out of the throes of great personal crisis, but also contribute towards economic recovery.


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