CORONA: LIKELY POLITICAL FALLOUT

by April 27, 2020 0 comments

GOVT FALLS..?

NATIONAL EMERGENCY?

Sounds hilarious to me too..!!

TEN COMMANDMENTS: 2020

  1. Corona is here to stay 
  2. Lockdown will be kind of “new” normal way of life. 
  3. Blue collar work force will now be scarce and at premium and there may be situations where new theme would be localisation than globalisation. 
  4. White collar work force may be at, steep discount, creating a divide among salary class. 
  5. Casualty percentage of COVID, to remain in the region of 4 to 5%
  6. Govt. would expect banks to cooperate and help almost all sectors whereas RBI and investors would expect banks to have necessary compliances and even heightened disclosures. Once a complimentary measure will have contradictory consequences. 
  7. Big will become bigger. Big fish will be gobble up the ailing fish. It would not be sectors but only “bankable” and equity market friendly group, would flourish 
  8. In 2021, it would be almost impossible to justify and convince people at large of the various action Govt. has taken to tackle the crisis. Present problem and in retrospect, would appear too miniscule, vis a vis various action Govt. has taken or not taken.  Such will be perfect breeding ground of lot many convincing theories. Blame game would be at its best.
  9. One can’t rule out vast population will see exodus towards villages, including upper middle class of the society. 
  10. It is impossible that under such pandemic, for any incumbent Govt. to keep majority of the population happy and satisfied. 

In recent times we have been hammered with the popular quote Extraordinary situation demands extraordinary measures”  but this quote is half the truth, the full truth is, that extra ordinary measures leads to extra ordinary consequences. 

Lockdown, was the most important extraordinary measure the Govt. could have taken. Lockdown was certainly not imposed to flatten the curve but tactically intended to delay the curve, to gain time, to enable the Govt. for preparation of such impending disaster. Thali and tali was tactically aimed to christen health workers as warriors with nationalist spirits and passion.  This strategy worth a salutation. A great psychological move . Govt. needed health “warriors” to work on infrastructure it developed.  Anti India forces could recognize this Govt. move and first attacked those warriors to flatten the morale. 

Govt. has done, so far, a fabulous and commendable job with the support from health workers and police department across the India to an extent most of the citizen believed that 

Politicians work too and Police are honest too.”

Pramod Jain

Now coming to the Consequences part, for any incumbent government, in such situation, will definitely fail to satisfy the aspiration and expectation of the people. There will be a strong anti incumbency wave backed by disparity in society, Big- Becomes- bigger, situation will run the risk of igniting into a civil unrest. Flame of dissatisfaction, already though, slowly simmering and brewing in the political pot and then at the right time a skillful trigger will this turn into a  fully blown explosion. Social media will come handy for this “cause” to do the final act. Once Corona tamed, in retrospective situation, it would be impossible for the government to convince and convey the people the logic of lock down, when death percentage is merely 3-5% and even in absolute terms even if it is 1 lac casualty. Opposition would then ask if the lock down was worth for mere 1 lac casualty and lot many theories would come on play, in retrospect. 

Initial response to the lockdown of the Govt. was by and large, well received and accepted by General public and will continue to get the support for some time,  may be even till 30th May. But thereafter how long, no one has answer and no one seems to have any clue. Goal post would keep changing and keep people confused, guessing and era of uncertainty sets in. 

We must accept that Corona is here to stay till we don’t get anti -dote or vaccine which is still, at least, 9 months away

In such situation, Govt. has two option either to lift the lock down preceded by formulation of strategy with the death percentage as acceptable devil and make this ratio as threshold reference to issue general health compliance and regulation and open the lock down and or leave it on the respective state government. 

Lifting lockdown at this stage, may have its own fall out, even though it may look economically responsible and attractive:

  1. There will still be a situation of self imposed lock down, workers would still wary to return from the villages to the cities and they would feel happy in their own shell back at home, even if they return workforce, for sure, will come at huge premium. Era of body shopper may set in, in lines of IT industry.
  2. Govt. would find itself in difficult situation to politically convince the masses of the logic of imposition of lockdown when infected person were not even 500 and lifting of lockdown now, when infected person is more than 40000 (a likely figure on 3rd may).  A Sitting duck opportunity for opposition parties. 
  3. Any explosion of number of cases will crumble, under pressure, the two most vital pillars of the society health workers and enforcement institutions such as Police. This is what the opposition parties waiting for. It is a catch 22 situation. 

Now the other options Govt. has, is to continue the lock down for indefinite period. Continuing the lockdown, is like riding the lion. If you get down from. Lions back, lion will suck u but then how long u can ride on lion back.

There are so many likely socio economic fall outs of continued lock down situation, some of them are:

  • Civil unrest 
  • Civil disobedience (like Shaheen Bagh)
  • Run on banks
  • Communal tension
  • Breakdown of law and order 
  • Collapse of health infrastructure 

So what Govt. at present strength and might may consider to impose national emergency and nationalise all banks as it’s instant measure and reset the entire economy. 

And why not, it is

Extraordinary time…

Extraordinary measures…

Extraordinary consequence …!!!

Created & Written by Pramod Jain ( He is an ex merchant banker. He is the chairman of Plus Group Venture capitalist, angel investor and investors )

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