New Delhi: In November 2020, a survey carried out by Local Circles, a community social media platform revealed that Indians are likely to be hesitant of a COVID-19 vaccine. In the survey, 59% of all respondents (8,936 total respondents) said they will not rush to get the vaccine even if it is available by February 2021. Similarly, Accredited Social Health Activist (ASHA) workers conducting door to door survey about the vaccine in Gujrat earlier this month, said people are sceptical about being first in line for an “unknown vaccine”.
However, as per a global survey conducted by the World Economic Forum/IPSOS, 87% of Indians said they would get a vaccine for COVID-19. This figure was much higher than the global average, where overall, 73% of respondents said they would get a COVID-19 vaccine if available.
The intent of vaccination amongst Indians has remained unchanged in 2 rounds of the surveys (August and November 2020). However, for 10 countries, including China, Australia, Spain, and Brazil, the intent of getting a vaccine amongst respondents has reduced.
What are the main reasons for not wanting to get a COVID-19 vaccine? Globally, the side effects are the highest cited concern (34%), followed about concerns about clinical trials moving too fast (33%). Similarly, 34% of Indians also said they are worried about the side-effects, while 16% said they are concerned about the fast-moving trials.
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SHIV SENA’S POLITICAL IMBROGLIO
On 21 June 2022, Maharashtra Urban Affairs minister and senior Shiv Sena leader Eknath Shinde launched a rebellion against Chief Minister and Shiv Sena President Uddhav Thackeray. Shinde, along with 11 other Sena lawmakers, left for Surat in the neighbouring Bharatiya Janata Party (BJP)-ruled Gujarat. As the political crisis unfolded over the next few days, the roster of rebel Members of Legislative Assembly (MLAs) following Shinde allegedly jumped above 50 (as this goes to print), with 39 belonging to the Shiv Sena from its tally of 55 in the state assembly and rest either independent or coming from smaller parties. As the number of rebel MLAs increased, the Shinde camp shifted base to the north-eastern state of Assam, also ruled by the BJP, with families of some MLAs claiming they were held against their will. Interestingly, of the 39 rebel MLAs, nine are ministers in the Maha Vikas Aghadi (MVA) government, holding key portfolios of agriculture, urban development, finance and public health, amongst others.
The crises in India’s politically crucial and wealthiest state have escalated in less than a week as the fight has now reached the Supreme Court of India (SC). The rebel MLAs form a comfortable majority over the two-thirds, or 37, Sena MLAs required to bypass the anti-defection law and lay claim as a separate faction of the party. The Thackeray-led Shiv Sena has reached out to the Deputy Speaker of the Maharashtra Assembly to expel the rebel MLAs and prevent them from claiming Bal Thackeray’s legacy.
The Maha Vikas Aghadi (MVA) alliance is in turmoil as Eknath Shinde, a Cabinet Minister from Maharashtra and veteran Shiv Sena leader, rebelled against the party leadership after the recently concluded MLC elections.
During the 2019 Maharashtra Assembly elections, BJP and Shiv-Sena contested as alliance partners.
Source: Tv9 Marathi
GENESIS OF THE POLITICAL CRISIS
The political crisis unfolding in Maharashtra has its roots partly in the MVA coalition formed after the 2019 Maharashtra Assembly elections. While the elections gave a clear majority to the incumbent BJP-Shiv Sena alliance with 105 and 56 seats, respectively, seat-sharing agreement fell through as the alliance partners failed to reach an agreement over the ministerial berths and the chief minister’s post. The following days witnessed a curious turn of events from the implementation of President’s rule in the state to Nationalist Congress Party (NCP) leader Ajit Pawar’s failed rebellion to support the BJP under Devendra Fadnavis’ leadership. The BJP-Ajit Pawar government led by Fadnavis was sworn in with Pawar as the deputy CM but fell in less than three days as rebel NCP MLAs abandoned him. In an interesting turn of events, also involving the SC’s intervention to hold a floor test, NCP’s Sharad Pawar cobbled up an unusual coalition of parties with diametrically opposite ideologies as Uddhav Thackeray was sworn in as the 19th Chief Minister of the state. The MVA government comprising Shiv Sena, NCP, and the Congress had the backing of 163 MLAs, including independents and lawmakers from smaller parties.
Over the past two and a half years, the alliance has sailed through shaky waters with several within and outside the MVA also doubting the likelihood of the alliance completing a five-year term. Discordant MLAs across the three parties have shown unwillingness to support alliance partners and work together in ministries and departments apart from allegations of cross-voting in the Rajya Sabha and MLC elections. The recently concluded MLC and Rajya Sabha elections laid bare the deep fissures in the MVA with the Shiv Sena’s inability to transfer votes to the Congress MLC candidate. Subsequent cross-voting helped the BJP gain one extra MLC seat at the cost of the Congress. Adding to that, the Shiv Sena’s recent back and forth to fight the local body polls alone or in an alliance with the MVA partners has signalled the party leadership’s lack of faith in transferring its political coalition at the top to a social coalition and vote transfer to alliance candidates on the ground.
DISCONTENTMENT WITH INCUMBENT CHIEF MINISTER
Shiv Sena had formed an alliance with Congress, NCP and independent MLAs with Uddhav Thackeray as Chief Minister.
Source: India Today
Rebel leader Eknath Shinde has called the ruling MVA government an “unnatural alliance” and has referred to the rebellion as a desperate attempt to reinvigorate Balasaheb’s ideals and a critical step for the benefit of the Shiv Sainiks on the ground. What’s more, several key leaders were unhappy from the beginning as the Shiv Sena broke ties with the BJP, nurtured by Shiv Sena founder and party supremo Balasaheb Thackeray, after the 2019 elections. Many also felt that in spite of being the largest party in the coalition, two of the key portfolios- home (which is with NCP) and revenue (which is with Congress) remained elusive for the Sena MLAs. However, the Shiv Sena’s recent troubles are not simply a result of a poorly planned electoral coalition.
While Eknath Shinde and the rebel MLAs have expressed discontent in allying with the Congress, having vehemently fought over the years, Shiv Sena MLAs have also expressed their resentment with Chief Minister Uddhav Thackeray. Several MLAs have complained of the unavailability and inaccessibility of the Chief Minister to party MLAs, his biased favour of the alliance MLAs in the allocation of developmental funds, and their inability to meet him at the Chief Minister’s office. Senior leaders have expressed dissatisfaction at the rising clout of young leaders led by Chief Minister’s son and cabinet Minister Aaditya Thackeray and the consequent sidelining of seasoned leadership. Local leaders and MLAs such as Sanjay Shirsat also indicate the cadre’s unhappiness with the party’s move away from its core Hindu ideology, an unavoidable result of the party’s alliance with centrist NCP and Congress.
THACKERAY’S FIGHT FOR THE SENA
Shiv Sena MLAs have filed disqualification resolutions against rebels and counter resolutions have been filed by the rebels to quash the Deputy Speaker’s authority in the wake of the assumed loss of majority in the Maharashtra Assembly. The political crises may also jeopardise Uddhav Thackeray’s control over Shiv Sena and Bal Thackeray’s legacy. The rebel faction, in a direct attack on Thackeray’s leadership of the party, named their group Shiv Sena Balasaheb and has called out Uddhav Thackeray for his alleged inability to uphold Balasaheb’s ideals and ideology.
The rebel faction received a shot in the arm as the Supreme Court virtually put the disqualification proceedings initiated against 16 rebel Shiv Sena MLAs in abeyance. The court has extended the time for them to file their response to the notice issued by the Deputy Speaker of the Maharashtra Assembly till 12th July 2022. It has also questioned the legality of the Deputy Speaker to decide on its own removal.
Eknath Shinde along with other rebel MLAs are demanding withdrawal of Shiv Sena from the MVA alliance with Congress and NCP.
FUTURE OF SHIV SENA AND MVA
The MVA’s numbers appear to have fallen from 163 in the 288 seat Maharashtra Assembly as Shinde claims the support of 39 Sena lawmakers and six independents. The regime’s future looks bleak with its reduced numbers and is unlikely to prove its majority in the assembly. If the Shinde faction is able to hold fort and get a clean chit from the SC it could eventually back or even merge with the BJP and lead to a regime change, embarrassing the incumbent MVA government. It may give way to the formation of a new BJP government in the state, most likely under former chief minister Devendra Fadnavis’ leadership and with support from Shinde’s 45 plus MLAs. The BJP is the single largest party in the state assembly, holding 106 MLAs and, combined with 45 rebels, has the ability to cross the halfway mark of 144. However, not all rebel MLAs are willing to support the merger with the BJP.
While the BJP is coming across as a mute spectator and has called the crises an ‘internal matter’ of the Shiv Sena, purported meetings between Shinde, Fadnavis, and Union Home Minister Amit Shah cast aspersions on the party’s role in the crises or its final outcome. The next few days will be crucial not only for Eknath Shinde and his ability to lead one of the largest ever rebel factions that the state has witnessed, but also for Uddhav Thackeray, who is fighting to retain control of the Shiv Sena and the legacy of his father Balasaheb Thackeray.
Contributing reports by Arin Prabhat, Ashita Koul, Kaustav Dass, and Nehla Salil, Interns at Polstrat.
INDIAN PRESIDENTIAL ELECTION 2022
17 major opposition parties held a second meeting yesterday in New Delhi to discuss their candidates for the 2022 Presidential polls that are scheduled to be held on 18th July. The meeting was hosted by West Bengal Chief Minister and Trinamool Congress president Mamata Banerjee. Major parties in attendance included the Indian National Congress (INC), Communist Party of India (CPI), Communist Party of India (Marxist) (CPIM), Indian Union Muslim League (IUML), and regional parties such as Nationalist Congress Party (NCP), Rashtriya Janata Dal (RJD), Samajwadi Party (SP), and Janata Dal-Secular (JDS), amongst others. Some notable names missing from the meeting were the Aam Aadmi Party (AAP) and the Telangana Rashtra Samithi (TRS), which is led by Telangana Chief Minister K Chandrashekhar Rao. Industry experts wonder if the meeting is testing opposition unity ahead of the 2024 national elections. While the opposition parties came up with a list of candidates, the first three choices in their list, including NCP supremo Sharad Pawar, have so far declined the offer. Former Union minister Yashwant Sinha finally accepted the opposition’s offer as its joint candidate for the presidential polls. On the other hand, the Bharatiya Janata Party (BJP), which is in majority in the Lok Sabha and close to a majority with its allies in the Rajya Sabha, has an edge in the upcoming presidential polls. However, the party has not yet announced a candidate for the upcoming polls.
The Presidential elections are crucial as the opposition wants to put the BJP in a difficult situation, while the BJP wants to retain its dominant position.
HOW IS THE PRESIDENT OF INDIA CHOSEN?
The President of India is indirectly elected by an electoral college consisting of the elected members of both the houses of Parliament, the elected members of the Legislative Assemblies of the 28 states, and the elected members of the legislative assemblies of the Union Territories of Delhi, Puducherry, and Jammu and Kashmir. The 12 nominated members of the Rajya Sabha are not allowed to vote in the Presidential elections. This means that 4,120 members of legislative assemblies and 776 Members of Parliament (MPs) elect the President. As per the electoral college system, the value of votes that each Member of Legislative Assembly (MLA) and Member of Parliament has varies as per the population of the state. This means that the value of an MLA’s vote will vary from state to state in order to reflect the population of each state. A simple formula is used to calculate this. The total population of the state (as per the 1971 census) is divided by the total number of MLAs in the state, which is then multiplied by 1,000.
The BJP has to rely on parties like the Biju Janata Dal (BJD) led by Odisha’s Chief Minister Naveen Patnaik which has over 31,000 votes in the upcoming presidential elections.
A secret ballot under the transferable vote system is used to elect the President of India. Each MLA and MP ranks the presidential candidates in their order of preference, and the candidate with the lowest number of votes will drop out. Votes given to this candidate are then redistributed based on the next preference, and this goes on until one candidate secures the needed majority. In order to win, a candidate must have more than 50 per cent of the votes.
The election commission of India has scheduled the date for the presidential elections on 18th July, with the counting of votes to be held on 21st July. 4,809 electors comprising MPs and MLAs will vote to elect current President Ram Nath Kovind’s successor. Despite the BJP’s majority in the Lok Sabha and almost-majority in the Rajya Sabha, with an electoral college of around 10.86 lakh voters, the BJP-led National Democratic Alliance (NDA) is slated to have around 48 per cent of the total votes, and is expected to be able to win the support of non-aligned regional parties such as the Yuvajana Sramika Rythu Congress Party. Though the BJP’s equation with some of its allies has changed after the 2022 Assembly elections, it is still extremely likely that the BJP-led NDA will win the Presidential polls.
So far 15 candidates have filed their nominations for the Presidential polls since the process began on 16th June. As per the Election Commission of India (ECI), the last day to file nominations is 29th June. Even though 15 candidates have already filed their nominations, arguably, the two most important contenders will be the candidate of the ruling party (NDA) and the candidate supported by the opposition parties. Among the nominations, some candidates have contested the Presidential polls several times.
WHO ARE THE PROBABLE CANDIDATES?17 Opposition parties met on 15 June in New Delhi to decide on a joint candidate for the presidential election so that the votes are not divided amongst the opposition. Source: Wikimedia Commons
The BJP has not announced its presidential candidate yet. While it has the option of reaching a consensus with the opposition, it can also spring a surprise by fielding a random candidate like it did in 2017 with President Ramnath Kovind. Source: NDTV.com
Analysts and industry experts have suggested that the BJP-led NDA’s candidate is likely to be a surprise in line with its past patterns. As reported by OneIndia, the party is likely to meet on 21st June to discuss its Presidential candidate. This decision is being taken by a 14-member management committee comprising several Union ministers, the party’s three general secretaries, and other leaders.
Industry analysts have been talking about a few major probable candidates. One of the first names on this list is Kerala governor Arif Mohammad Khan. Khan, who has been a Union Minister, started his career as a student leader and later joined the Congress. Since then he has shifted between multiple parties, including the Janata Dal and BSP, until he finally joined the BJP in 2004, and successfully contested the Lok Sabha elections from Kaiserganj constituency. He has had a long political career and held several portfolios, ranging from energy to civil aviation.
Another major candidate from the BJP could be Draupadi Murmu, the Governor of Jharkhand. A tribal leader from Odisha, she is the only governor of Jharkhand to successfully complete a five-year term in the state. In the past, she has served as an MLA and as Minister of State for Commerce and Transport, as well as Fisheries and Animal Resources Development. Murmu is one of the first female tribal leaders to be elected as Governor of an Indian state and has championed the cause of working for the rights of the tribal population.
Senior BJP leader and former Lok Sabha Speaker Sumitra Mahajan’s name is also making rounds in the political corridor. Mahajan was only the second woman after Meira Kumar to be elected as the Lok Sabha speaker and was the longest-serving MP from the Indore constituency of Madhya Pradesh after she won elections consecutively from 1989 to 2019. Other major names include Chhattisgarh governor Anusulya Uikey, Karnataka Governor Thawar Chand Gehlot, Telangana governor Tamilisai Soundararajan, and Jual Oram – a tribal leader from Odisha – amongst many others.
The first and one of the most prominent names on the opposition’s list was that of Nationalist Congress Party (NCP) Chief and former Union Defence Minister Sharad Pawar. However, Pawar declined the nomination in a tweet. Following this, the opposition parties suggested the name of former Jammu and Kashmir Chief Minister, Dr Farooq Abdullah. However, he also said he wanted to “respectfully” withdraw his name from consideration as he wants to continue being involved in active politics and make a “positive contribution in the service of J&K and the country.” Following this, former West Bengal Governor Gopalkrishna Gandhi turned down the opposition’s offer to be the candidate for the polls. Major opposition parties met again in the capital on 21st June to discuss other probable candidates for the polls. After the second round of discussions, the opposition parties announced former Union minister Yashwant Sinha as its joint candidate. He has held important portfolios including Finance and External Affairs. Sinha was a member of the BJP till 2018, when he quit the party to join the TMC.
Contributing reports by Damini Mehta, Senior Research Associate at Polstrat and Arin Prabhat, Ashita Koul, Kaustav Dass, Nehla Salil, Pavitra Mohan Singh, Interns at Polstrat.
REPO RATE TAKES A HIKE
On 8 June 2022, the Reserve Bank of India (RBI)’s Monetary Policy Committee (MPC) increased the policy repo rate under the liquidity adjustment facility (LAF) to 4.90 per cent, a hike of 50 basis points from the previous revision in May 2022. The move follows a sudden off-cycle revision in the repo rate in the month of May when the MPC increased the repo rate by 40 basis points to 4.40 per cent. Both moves aimed at curbing the heightened inflation levels caused by various domestic and international factors, including but not limited to the Russia-Ukraine conflict and the COVID-19 pandemic.
The Organisation for Economic Co-operation and Development (OECD) has cut down India’s GDP forecast from 8.1% to 6.9%.
The 08th June revision is the second consecutive hike in the benchmark repo rate after a year-long consistency by the RBI in an attempt to boost economic growth. The MPC at its meetings in April, June, August, October, and December of 2021 had kept the policy repo rate consistent at 4 per cent for the Financial Year 2021-22. RBI, in its Monetary Policy Statement of 08th June, emphasised that the current hike was ‘in consonance with the objective of achieving the medium-term target for consumer price index (CPI) inflation of 4 per cent within a band of +/- 2 per cent, while supporting growth’.
The RBI uses the benchmark repo rate as one of the main tools to regulate the monetary situation in the Indian economy. Repo rate is the rate at which the central bank of a country lends money to commercial banks in the event of any shortfall of funds. A hike in repo rate increases the cost of borrowing in the economy for domestic consumers and businesses. It reduces their purchasing power and investment capacity thereby helping bring down inflation. However, a lower repo rate often helps in giving a push to economic activity by promoting lending by the banks (a fall in repo rate is an incentive for banks to reduce their Rate of Interest on loans).
The past two years witnessed a slowing down of economic activity owing to COVID-19-induced curbs and a global economic downturn. The Indian economy contracted by 23.8 per cent in the starting months of the COVID-19 pandemic from April to June 2020 and 6.6 per cent in the July to September quarter of 2020. Overall, according to the National Statistical Office (NSO), GDP contraction for the financial year 2020-21 was 6.6 per cent. In the financial year of 2021-22, according to NSO’s February estimates, GDP growth stood at 20.3 per cent in the April to June quarter and 8.5 per cent in the July to September period.
During this period, the RBI focused on promoting economic activity and lending in the economy through its monetary policy. To stave off the reduced economic activity, the MPC dropped its repo rate by 75 basis points in a month from 5.15 per cent in February 2020 to 4.40 per cent in March 2020. After reducing it further by 40 basis points, the repo rate remained consistent at 4 per cent for nearly two years from May 2020 to May 2022. According to the Ministry of Statistics and Programme Implementation (MOSPI) numbers, Consumer Price Index (CPI) general or headline inflation in India fell from a high of 6.73 per cent in July 2020 to to 4.06 per cent in January 2021 before rising back to 7.79 per cent in April 2022 (nearly an eight-year high). According to the most recent MOSPI figures, inflation for the month of May 2022 has eased to 7.04 per cent. However the falling inflation is unlikely to contribute much to slowing down the recent RBI rate hike cycle.
BROAD-BASED PRICE RISE
In its June report, the RBI highlighted the broad-based nature of inflation which was showing up in rising prices of services and was no longer limited to goods inflation. Notably, between February and April of 2022, the headline inflation has risen by about 170 basis points. The wholesale price inflation, a measure of price rise at the level of producers, has consistently been in double digits for 12 consecutive months between April 2021 and April 2022. In November 2021, it touched a high of 14.87 per cent driven largely by the rise in crude oil prices in the international market. On the other hand, retail inflation, which directly impacts the local consumer, has been on a constant uptick since September last year, touching 6.07 per cent in February 2022. Retail inflation witnessed a rise mainly owing to rising prices of essentials like oils and fats, vegetables, and protein-rich items such as ‘meat and fish’.
The Russia-Ukraine conflict and the COVID-19 pandemic have disrupted supply chains and led to a shortage of various goods globally, resulting in inflation and economic distress in several countries. Moreover, sanctions on Russia have impacted the supply of crude oil and pumped up prices in international markets. The rise in fuel prices has a direct impact on transportation costs thereby pushing the prices of all other commodities.
The current repo rate hike of 50 basis points aims to deal with the impact of the above developments on the Indian economy. It is coupled with the MPC’s changed stance from May 2022 onwards from a ‘commitment to remain accommodative’ to ‘withdrawal of accommodation’. It reflects the RBI’s decision to shift its focus from giving a thrust to economic growth through reduced rates to controlling the rising inflationary trends through costly lending. While the repo rate remains below the pre-pandemic level of 5.15 per cent, this recent hike is a desperate attempt to bring prices of goods and commodities down and reel in inflationary pressures.
STATE OF INDIAN ECONOMY: PROJECTIONS
RBI Governor Shaktikanta Das has predicted that an increase in contact-intensive services is expected to lead to a rise in urban consumption and rural demand will increase with the onset of monsoon.Despite all the projections, India’s exports grew by 24% in just the first week of June and the Indian economy is still projected to be the fastest growing economy for a second year in a row.
RBI Governor Shaktikanta Das has predicted that an increase in contact-intensive services is expected to lead to a rise in urban consumption and rural demand will increase with the onset of monsoon.
Despite all the projections, India’s exports grew by 24% in just the first week of June and the Indian economy is still projected to be the fastest growing economy for a second year in a row.
According to the MPC’s June meeting, the Indian economy is expected to broaden its recovery going forward owing to several positive developments. Contact-intensive services are likely to bolster urban consumption, investment is expected to receive a boost through improved capacity utilisation, the government’s capex push, and strengthening of bank credit and rural demand, which is gradually improving from a normal south-west monsoon. However, several international organisations have cut down their projections for India’s GDP growth for the ongoing fiscal year. The Organisation for Economic Cooperation and Development (OECD) warns that the Indian economy is losing its growth momentum because of inflationary pressures from rising global energy and food prices even as monetary policy normalises and global conditions deteriorate. It has cut down its growth forecasts for India from 8.1 per cent predicted in March to 6.9 per cent in June 2022.
The World Bank has also cut down its GDP growth forecast for India for this fiscal thrice from the previous 8.7 per cent to 8 per cent in April and 7.5 percent in June 2022. The International Monetary Fund which, in January 2022, predicted a much higher growth rate for India this fiscal at 9 per cent has brought down its estimates too but remains positive that the country will clock a growth rate of 8.2 per cent (June estimates). The RBI’s real GDP growth projection for 2022-23 is retained at 7.2 per cent. According to the projections, the first quarter will record a growth rate of 16.2 per cent, declining significantly to 6.2 per cent, 4.1 per cent, and 4.0 per cent in quarters two, three, and four, respectively.
Persistent geopolitical tensions, sanctions on Russia, a resultant rise in crude oil prices and the lingering supply chain bottlenecks due to the COVID-19 restrictions have contributed to inflationary trends in India and abroad. Moreover, while the domestic restrictions on wheat export are expected to augment supply at home and ease off food inflation, heatwave-induced shortfall in rabi crops’ production may be a contributing factor to high food inflation in the country. The change in the RBI’s policy and a hike in repo rate is driven largely by the intent to deal with the impact of the above factors on the Indian economy and is likely to lead to a further hike in the coming fiscal year.
Contributing reports by Arin Prabhat, Ashita Koul, Kaustav Dass, Nehla Salil, and Pavitra Mohan Singh, Interns at Polstrat.
WHY MILLIONS OF INDIAN WOMEN ARE LEAVING THE WORKFORCE
Alarming figures about the impact of the COVID-19 pandemic on India’s gendered labour force participation rate published in the past week have raised alarm bells amongst economists and policymakers. As per data collected by the World Bank, between 2010 and 2020, women working in India declined from 26% to 19%. Following the onset of the COVID-19 pandemic, as per an article published by Bloomberg, the figure has declined to 9% in 2022. The female labour force participation rate is defined as the proportion of women above the age of 15 who are economically active, and that are currently employed or seeking employment. People who are still undergoing studies, housewives and persons above the age of 64 are not counted in the labour force. The labour force participation rate for females in India had already been declining before the pandemic, due to a combination of social, cultural and economic factors, which had led to an overall decrease in the availability of jobs for women. However, even 2 years after the onset of the COVID-19 pandemic, the recovery in the labour force participation rate of women has been incredibly slow, pointing to the fact that millions of Indian women have left the labour force permanently.
Women’s share in the workforce has been falling rapidly since the 2000s and has been further reduced by the pandemic
WHAT IS HAPPENING?
As per data by the Centre for Monitoring Indian Economy (CMIE), almost 17 million Indian women lost their jobs in the first month of the lockdown. It brought down the female labour force participation rate of the country to a four year low of 11%. This figure becomes even starker when you compare it to the male labour force participation rate of 71%. As the pandemic continued, the urban female labour force participation rate declined, reaching an all-time low of 15.5% in April-June, the first quarter of the lockdown, although it improved marginally to 16.1% in the September quarter. While overall India’s labour force participation rate has been improving since October 2020, the recovery has been incredibly unequal when you look at the gender division in the same.
However, it is important to note that the labour force participation rate of women in India was already struggling before the onset of the pandemic as well. As per World Bank estimates, India’s female labour force participation rate, defined as women 15 years or older, working or actively looking for a job, was amongst one of the lowest in the world. In 2020, it was estimated to be around 19%, which was significantly lower than that of its neighbours Bangladesh (35%) and Sri Lanka (31%).
During any major economic shock, such as the COVID-19 pandemic, women tend to pay the highest price. Managing director and CEO of the Centre for Monitoring Indian Economy (CMIE), Mahesh Vyas said in an interview while speaking to IndiaSpend, that even in the aftermath of demonetization, 2.4 million women disappeared from India’s economy, while 0.9 million men gained jobs during the same time. Women bore the entire economic brunt of the impact of demonetization, and a very similar trend has been observed due to the impact of the COVID-19 pandemic.
WHY ARE FEWER WOMEN BEING EMPLOYED IN THE LABOUR FORCE?
The reasons behind this sharp decline in the female labour force participation rate are a complex set of social and cultural barriers, which have continued to exist in the Indian economy for decades, and have been accentuated by the pandemic. These include household expectations from women, lack of access to education, lack of safe and affordable public transportation, rise in rates of underage marriages and the invisible role of women in the economy.
One of the key reasons for the persistent decline in female labour force participation is the social structure and role of women as caretakers in Indian families (rural as well as urban). Before the pandemic, Indian women already performed about 10 times more care work than men, around three times the global average. As per the Organisation for Economic Co-operation and Development women in India spend up to 352 minutes per day on domestic work, which is around 57 per cent more than men in any household. Another key reason is marriage. According to studies, married women also have lower labour force participation rates, and amongst rural women, the largest declines in the same were observed in the below 34-year, child-bearing age categories. Over 90 per cent of women who did not work reported that they were primarily engaged in domestic duties, as per National Sample Surveys. The COVID-19 pandemic certainly accentuated this, with an increase in the number of unplanned pregnancies for younger women, more marriages of younger women and an overall increase in the number of women giving up work to take up domestic responsibilities.
Apart from the societal and cultural norms which force women into domestic roles instead of taking up work, the lack of opportunities available to women even with moderate education/skill levels is another major contributing factor to the gender gap in employment. As per data, despite increases in both primary and secondary education levels overall, women have been continuing to lose out on opportunities in sectors which are fast-growing, such as services and manufacturing as these require technically skilled labour, and prefer men, who tend to have higher tertiary and vocational training qualifications. Automation in traditionally labour-intensive industries such as agriculture, manufacturing, and mining, has also had a disproportionate impact on women’s employment. It is estimated that around 12 million women are likely to lose their jobs due to automation in agriculture, forestry, and other allied sectors in India by 2030.
WHAT ARE THE IMPLICATIONS OF THE INCREASING GENDER GAP IN EMPLOYMENT?
A report released by UN Women, entitled “COVID-19 and its economic toll on women: The story behind the numbers” paints a grim picture of the impact of the pandemic on poverty and income inequality globally. The report highlights that the pandemic-induced poverty will widen the gender gap in poverty, which means more women will be pushed into extreme poverty as compared to men. This is particularly valid for young women in the age group of 25-34. It is estimated that in 2021, globally, there will be 118 women for every 100 men in extreme poverty, and this figure could rise to 121 poor women for 100 poor men by 2030. Being unable to address this rising gender gap in employment and labour force participation in India, will continue to impact all spheres of women’s development and the overall economic and social health of the country.
Estimates suggest that closing the employment gap between women and men in India (which is around 58%) could help increase India’s GDP by close to a third by 2050 (nearly $6 trillion as per Bloomberg Economics data).
In India, although women comprise 48% of the population, they only contribute around 17% of the GDP of the country, as compared to China, where they contribute around 40%. While across the world, women have lost more jobs than men as a result of the COVID-19 pandemic, the impact in India has been much higher and the recovery has been much lower. In fact, as per a study conducted by the International Monetary Fund (IMF), macroeconomic data reveals that adding more women to the workforce results in additional benefits for economic growth and production as women and men complement each other in the production process. As per the study, closing the gender gap could increase the GDP of countries by an average of 35 per cent (for countries in the sample). While four-fifths of these gains come from adding workers to the labour force, about one-fifth of the gains are due to the gender diversity effect on productivity.
It is very important to note that economic insecurity and loss of jobs and incomes are not the only impacts of the increasing gender gap in labour force participation rates. The loss of jobs and income and push of more and more women into extreme poverty has a multiplier effect on the quality of life of women and girls for years to come and could reverse all the gains made globally to help improve overall gender equality. It is important to develop specific policy changes which will address the root of the problem of gender disparity and boost the number of working women in the economy. Creating new jobs, along with encouraging upskilling of women thus allowing them access to pre-existing opportunities will help females gain more employment. Economists suggest adopting a female intensive growth strategy which will help increase employment opportunities for women in the middle of the education distribution. Implementation of policies that aim to promote employment of women beyond the “traditional sectors” that employ women such as education and an overall push to upskill, re-skill and increase educational opportunities are also needed.
Contributing reports by Arin Prabhat, Ashita Kaul, Kaustav Dass, Nehla Salil, and Pavitra Mohan Singh, Interns at Polstrat.
RAJYA SABHA ELECTIONS: POWER PLAY
There has been an ongoing muted tussle between National Democratic Alliance (NDA) allies in Bihar, the Bharatiya Janata Party (BJP) and the Janata Dal (United) (JD(U)) over the nomination of a candidate for one of the five Rajya Sabha seats due to go to polls on 10th June. Although the BJP is the senior partner in the alliance, Bihar CM Nitish Kumar has been calling the shots on several key issues, at times risking the alliance government in the state. On 29th May, Nitish Kumar, entrusted with selecting the nominee by the JD(U), decided in favour of sending its Jharkhand state president and former MLA Khiru Mahto to the upper house of the Parliament against the BJP’s desire to renominate incumbent Member of Parliament (MP) and Union Minister RCP Singh to the Rajya Sabha. The standoff is a quintessential example of the significance of Rajya Sabha elections in Indian politics impacting not only individual candidates but political parties and coalitions at the national and state level.\
On 12th May, the Election Commission of India announced the elections for 57 Rajya Sabha seats on 10th June, spanning 15 states and UTs. The seats will fall vacant as members retire from different state quotas between June and August 2022. Of the 59 members retiring, 25 belong to the BJP, two are from JD(U) and three are from All India Anna Dravida Munnetra Kazhagam (AIADMK). Nine of the 29 current Indian National Congress (INC) Rajya Sabha MPs will be retiring with the tenures of senior leaders like P Chidambaram and Jairam Ramesh coming to an end. The elections to the Rajya Sabha this year also hold importance as they come in the backdrop of the Presidential elections due in July 2022 and are likely to impact the Presidential electoral college.
COMPOSITION OF THE RAJYA SABHA AFTER THE MARCH 2022 ELECTION
Rajya Sabha MPs have a term of six years and a third of them retire once in two years. Members are elected biennially through proportional representation by elected members of a state legislative assembly. Since the strength of each party in a state assembly is known, a near-accurate estimation of the number of seats a party is likely to win in the Rajya Sabha poll is possible. Owing to this, Rajya Sabha elections are often a political tussle between different parties in a state, as in the case of Bihar, with alliance partners often contesting over the support for their choice of the candidate. Moreover, these elections are decisive for the party in power at the centre, as a weaker Rajya Sabha dampens its chances to clear crucial bills in the upper house.
A total of 70 Rajya Sabha Members retire over the course of 2022 and elections for 13 seats from six states were held on 31st March in Assam, Tripura, Nagaland, Himachal Pradesh, Kerala, and Punjab. Of the 13, BJP won one seat each in Assam, Tripura, Nagaland, and Himachal Pradesh. The Aam Aadmi Party (AAP) won five seats in Punjab and the Communist Party of India (CPI), the Communist Party of India (Marxist) (CPI(M)), and INC won one each in Kerala. After the elections, the BJP became the first party to cross the 100 seat mark since 1988-90 as its tally stood at 101 seats. The NDA had a total of 117 members in the 245 member of Rajya Sabha.
After the retirement of several members in April 2022, the BJP has 95 seats in the Rajya Sabha and is the single largest party in the upper house of the Parliament holding 41.13 per cent of the total seats. The INC’s tally reduced to a new low of 29 members or 12.55 per cent, a result of its back to back losses in the state assembly elections over the years. According to the Rajya Sabha website, the INC is followed by the Trinamool Congress (TMC) with 13 MPs (5.63 per cent of the total seats) and the Dravida Munnetra Kazhagam (DMK) with ten MPs (4.33 per cent). The AAP and the Biju Janata Dal (BJD) have eight MPs or 3.46 per cent seats each in the upper house with the remaining seats held by parties such as Telangana Rashtra Samithi (TRS), Yuvajana Sramika Rythu Congress Party (YSRCP), AIADMK, and the CPI(M).\
IMPACT OF ASSEMBLY ELECTIONS ON RAJYA SABHA SEATS: UTTAR PRADESH & TAMIL NADU
UP sends the largest share of MPs (31) to the Rajya Sabha and 11 seats will go to the polls on 10th June. While the BJP’s victory in the 2022 UP assembly elections was a game-changer, the party’s reduced tally and change in alliances will impact its position in the Rajya Sabha tally. Between 2017 and 2022, the BJP’s seat share has reduced from 312 to 255 in the state legislature while the NDA’s has declined to 273 seats from 323 in 2017. Based on this, the BJP and its allies are well placed to win at least seven Rajya Sabha seats marking an increase by two and leaving SP and its allies with the remaining three.
The resignation of former senior Congress leader Kapil Sibal from the party and his decision to contest the Rajya Sabha elections as an independent candidate with the SP’s support have weakened the INC’s negligible presence in the state and its tally in the Rajya Sabha. Continuing its 2022 assembly election pitch to extend support to farmers and Jats, the SP and Rashtriya Lok Dal have nominated Jayant Chaudhary for one seat. Among the 11 retiring MPs from the state, five are from the BJP, three from SP, two from the BSP, and one from INC.
Assembly elections held in Tamil Nadu in May 2021 saw the M.K. Stalin-led DMK return to power after a hiatus of 10 years. The party formed a government in alliance with the Congress and is likely to hold an edge in the upcoming Rajya Sabha elections when six of the state’s quota of 18 seats will go to poll. The current breakup of the state assembly will help the opposition AIADMK win two out of the six vacant seats with the remaining three seats to be divided between DMK and INC as per their pact. The Dravidian state has 18 allotted Rajya Sabha seats of which ten are occupied by DMK, five by AIADMK and one each by the Tamil Maanila Congress, Pattali Makkal Katchi (PMK), and Marumalarchi Dravida Munnetra Kazhagam (MDMK).
MAHARASHTRA, ANDHRA PRADESH, KARNATAKA: LIKELY CHANGE IN PARTY POSITIONS
The Rajya Sabha elections are especially important for the Congress since it needs a stronghold in the Upper House before the Presidential election in July 2022. Source: indiatoday.in
In Maharashtra, which sends the second largest number of MPs to the Rajya Sabha at 19, six seats will be up for grabs on 10th June. The tenures of Union Minister Piyush Goel, INC leader P. Chidambaram, NCP leader Prafulla Patel, Sanjay Raut of Shiv Sena, and BJP leaders Vikas Mahatme and Vinay Sahasrdebude will end, giving way to the election of new members. While the BJP is the single largest party in the state assembly with the incumbent MVA government and its constituents INC, NCP, and the Shiv Sena, the former will be able to elect only two members as opposed to its earlier strength of three. While the Shiv Sena has announced candidates for two seats— Sanjay Raut and Sanjay Pawar—the Congress unit of the state has suggested for the Congress High Command to select a local candidate from Maharashtra. The BJP has fielded Piyush Goyal, Dr Anil Bonde, and Dhananjay Mahadik for three Rajya Sabha seats. Currently, of Maharashtra’s 19 Rajya Sabha seats, eight are occupied by the BJP, four by the Nationalist Congress Party, three each by INC and Shiv Sena, and one seat by the Republican Party of India.
In Andhra Pradesh, all four vacant seats are likely to be occupied by the incumbent YSRCP led by Chief Minister Y S Jagan Mohan Reddy. Of AP’s 11 Rajya Sabha seats, five are currently held by YSRCP and by nominating four members, the party will increase its tally to nine seats with the remaining two seats occupied by C.M. Ramesh from BJP and K.R. Kumar from Telugu Desam Party (TDP). According to the current break up of the parties in the state assembly, no other political party is in a position to win any Rajya Sabha seats from the state. On the other hand, Karnataka which sends 12 MPs to Rajya Sabha, will witness elections for four seats as Nirmala Sitharaman (BJP), K.C. Ramamurthy (BJP), and Jairam Ramesh (INC) retire from the upper house on 30th June, and Oscar Fernandes’ (INC) demise created a vacancy. Party positions in the state legislative assembly will likely help the BJP win two seats (it currently holds six) with the INC positioned to secure victory on one (current tally- five). The JD(S) leader Kupendra Reddy is speculated to win a Rajya Sabha seat through BJP’s support. Moreover, the incumbent BJP is also attempting to field candidates from within the state to stave off criticism it faced last time when it was accused of bringing candidates from the outside.
OTHER STATES AND IMPACT ON PRESIDENTIAL ELECTIONS
The Rajya Sabha elections are decisive for the party in power at the Centre, as a weaker Rajya Sabha dampens its chances to clear crucial bills in the Upper House. Source: NDTV
Rajasthan will also witness elections on four of the 10 Rajya Sabha seats from its share whereas elected legislatures of Madhya Pradesh and Odisha will vote for three MP seats each. MLAs from Punjab, Telangana, Jharkhand, Chhattisgarh, Bihar, and Haryana will also vote on 10th June 10 to elect two MPs each. Lastly, of the three MPs from Uttarakhand, one will retire paving the way for fresh elections on 10th June.
The elections to the 57 Rajya Sabha seats will be pivotal for the 16th Presidential Election in the following month. While the recently concluded assembly elections in five states, especially Uttar Pradesh and Punjab, have altered the strength of the BJP and the NDA in the Presidential electoral college, the party is still well-positioned to elect its candidate as the President with support likely from non-NDA and non-UPA allies such as BJD and YSRCP.
Even as the vote value of each MLA varies from state to state, the value of each MP vote from the Rajya Sabha and the Lok Sabha is fixed at 708. A greater number of MPs elected through the Rajya Sabha will safely situate the BJP to elect its choice of Presidential candidate—most likely Vice-President Venkaiah Naidu—unless a second term ticket is given to incumbent President Ram Nath Kovind. Moreover, opposition parties from across the political spectrum are coming together to leave no stone unturned and jointly put up an opposition candidate for the Presidential race. The Rajya Sabha elections will be decisive in determining the ability of opposition parties to mount a considerable challenge to the BJP.
Contributing reports by Arin Prabhat, Ashita Koul, Kaustav Dass, Nehla Salil, and Pavitra Mohan Singh, Interns at Polstrat.
EXTREME HEATWAVES RAISING ALARMS IN INDIA
Large parts of India and its neighbouring countries, including Pakistan, have been experiencing record high temperatures as a heatwave continues to engulf the subcontinent. The heatwave began in early March and continues to aggravate millions across the country. Major cities, including the national capital, recorded temperatures as high as 49.2 Celsius, which is the highest in 122 years (since records began). Heat warnings and advisories have been issued in many cities and states, with many schools changing school timings to accommodate for the impact such severe weather could have on young chldren.
As per the Indian Meteorological Department (IMD), a region is said to be experiencing a heatwave if maximum temperatures continue to exceed 40 Celsius in lowland regions, or at least 30 Celsius in the highlands, for at least two consecutive days. A heatwave is also declared if temperatures are 4.5-6.4 degrees above average, with temperatures 6.4 degrees above normal being classified as a “severe heatwave”. The heatwave has already claimed many lives across the country, apart from having a direct impact on the livelihood of those engaging in the informal economy and agricultural activities. The heatwave is also having an ecological impact, with reports in some cities of dehydrated birds falling from the sky. Additionally, it has exacerbated India’s power crisis, created by a short supply of coal and excess demand from industries. Amidst reports of the impact of the heatwave, studies produced by scientists at the World Weather Attribution initiative and the United Kingdom Met’s office revealed that extreme weather events such as the ongoing heatwave in India have been made more likely due to human-caused climate change, raising alarms across the globe.
WHAT ARE THE KEY FINDINGS OF THE STUDY?
An international team of climate scientists at the World Weather Attribution initiative published a study last week examining the role of climate change in earlier extreme heatwaves in the Indian subcontinent. 29 researchers, as part of the World Weather Attribution group, including scientists from universities and meteorological agencies in India, Pakistan, Denmark, France, the Netherlands, New Zealand, Switzerland, the United Kingdom, and the United States, participated in conducting the study. They analysed records of maximum daily temperatures in north-western India and south-eastern Pakistan to compare how they have changed with global temperature rise. The month of March this year was the hottest in India since records of the weather began 122 years ago. Pakistan also saw record high temperatures. In an attempt to quantify the changes in the weather, scientists analysed weather data using computer simulations, to compare the climate as it is today, after temperatures rising approximately 1.2 degrees because of global warming since the late 1800s, with the climate of the past.
It was found out that at present the chances of such a heatwave happening are once every 100 years. However, in a world without climate change, such an event would only happen once every 3,000 years, implying that climate change has led to extreme weather events becoming 30 times more likely. The team also used the same climate models to make projections about how the probability of such events could change in the future. The results revealed that if the rise in global temperatures continues to be 2 degrees above pre-industrial levels, such heatwaves could become two to 20 times more likely and could be up to 0.5 to 1.5 Celsius warmer.
In a similar manner, a group of scientists from the United Kingdom’s MET office also conducted a study, published earlier in May, which found that the record-breaking heatwave in India and Pakistan had been made 100 times more likely due to climate change. Scientists explained that the main reason for the difference in findings between the two studies was the different parameters used by the researchers. The Met office focused on a 2010 heatwave that affected different parts of India and Pakistan from May to June and instead imagined this heatwave had occurred in 2022. “Spells of heat have always been a feature of the region’s pre-monsoon climate during April and May,” said Scientist Nikolaos Christidis from the UK Met Office in a press release. “However, our study shows that climate change is driving the heat intensity of these spells making record-breaking temperatures 100 times more likely.” Both studies concluded that due to human-caused climate change, it’s now “common” to find such record-breaking heatwaves and that such “extreme weather events” are no longer “extreme” or “rare”.
HOW HAS THE HEATWAVE IN THE INDIAN SUBCONTINENT AFFECTED LIFE?
On 28 April this year, heat-related watches were in effect in almost all Indian states, covering millions of people and affecting all major cities. As per estimates, 90 people have already died in the subcontinent as a result of the heatwave this year. However, the real figure is likely to be much higher, as India counts ‘heatstroke deaths’ as only those deaths medically certified as having been caused by direct exposure to the sun, thereby capturing only 10 per cent of the real figure, leaving out deaths due to high ambient temperature. A major economic impact of a heatwave is on productivity and working hours for millions of people, especially those who work outdoors. According to an International Labour Organisation (ILO) report from 2019, India lost around 4.3 per cent of working hours due to heat stress in 1995 and is expected to lose 5.8 per cent of working hours in 2030. In absolute terms, India will lose the equivalent of 34 million full-time jobs in 2030 as a result of heat stress.
For the Indian subcontinent, where a large cross-section of workers engages in either the informal economy or in agricultural production, intolerable heat has a dire impact on productivity as it reduces the hours available for workers to work outdoors. Chandni Singh, an environmental social scientist at the Indian Institute for Human Settlements, said people working in informal settlements or those working in labour-intensive outdoor jobs are most affected. The heatwave also has an unequal impact on poor women, who are particularly vulnerable to heat stress as they tend to work inside homes without air conditioning. In rural parts of the country, women’s roles primarily include household work such as cooking and gathering provisions and water from outside their homes, all of which are labour intensive jobs. Daily wage workers, who work in construction not only bear the brunt of the heatwave, working extensively outdoors but also suffer greater heat exposure as they live in overcrowded spaces with little ventilation or air conditioning.
Due to the changes in average weather, overall living standards in India are expected to decline. A report by the World Bank titled “South Asia’s Hotspots—The Impact of Temperature and Precipitation Changes on Living Standards” showcased that when converted to GDP per capita, changes in average weather are predicted to reduce income in severe hotspots by 9.8 per cent in India by 2050.
The early onset of the heatwave impacts agricultural production, which is the primary source of income for millions in the country, especially those living in rural areas. As a result of the combination of the heatwave and the lack of rainfall, thousands of acres of agricultural produce and yield have been destroyed. As a result, the government announced a temporary ban on wheat exports, pushing up global prices further. As per an analysis published by the Economic and Political Weekly (EPW), extreme temperature shocks reduce yields for kharif crop (sown in monsoon) by 4 per cent and for rabi crops (sown in winter) by 4.7 per cent.
Such extreme weather events also cause a rise in spontaneous combustion. In April in New Delhi, a rash of landfill fires was caused due to spontaneous combustion. While in general calls to fire departments typically increase this time of year, Atul Garg, director of fire services in New Delhi, said that this time, the numbers have been a lot more. Typically 60 to 70 calls are recorded per day during this time of year, and this year it has been up to 160 per day.
The National Disaster Management Act, 2005, and the National Policy on Disaster Management, 2009, do not include heat waves in their list of natural calamities. As a result, financial and infrastructural resources are also not diverted towards the problem. Around 100 cities and 23 state governments have partnered with the NDMA to develop Heat Action Plans (HAP) as adaptation measures for extreme heat events. However, these action plans and warning systems are not resilient or effective against heat waves as they are not recognised under the National Disaster Management Act, 2005, making them ineligible for money from national or state disaster response funds.
ALARM BELLS RING AGAIN, BUT WILL WE LISTEN?
Undoubtedly, the scorching heatwaves in the Indian subcontinent have been enough cause for alarm that they have occupied national and international headlines for the past few days. Scientists, civic society organisations and environmentalists have pointed out that extreme temperatures are a sign of the direct impact of climate change and the lack of putting climate change friendly policies at the forefront of decision making. At the beginning of the COP26 conference on climate change in Glasgow in November last year, India announced that it aimed to achieve net-zero emissions by 2070. It also announced ambitious targets for 2030, including quadrupling its clean energy capacity to 500 GW, sourcing 50 per cent of its electricity from renewables, and reducing the emissions intensity—the number of greenhouse gases released per unit of economic activity—by 45 per cent compared to the 2005 baseline. While India has added renewable energy at a faster clip than any other large country in the world, including an 11-fold increase in solar-generating capacity over the last five years, scientists argue that the country is not even close to playing catch-up when it comes to mitigating climate change.
State governments started to formulate targets to combat climate change by designing State Action plans prior to the Paris Agreement on Climate Change, which was signed in 2015. While some incremental steps are being taken by the state governments, these are nowhere near the scope or the scale required to contribute effectively to the national goal of carbon neutrality. Many states have realised the challenges in implementing these climate action plans, with the most prominent being the lack of climate finance along with limited scientific knowledge, and technical and institutional capacity constraints. The lack of coordination between institutions, departments, and stakeholders at various levels has also severely undermined collaborative climate action in the past. Action against climate change continues to be on the backburner for organisations and governments despite alarm bells.
Contributing reports by Damini Mehta, Senior Research Associate at Polstrat and Kaustav Dass, Nehla Salil, Pavitra Mohan Singh, Interns at Polstrat.
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