August 01, 2021

Covid worsened the Precarious Conditions of Urban Dwellers

Tikender Singh Panwar

COVID pandemic has exposed the hollowness of the urban development trajectory in India. Since the last few decades especially after the economic reforms in the 1990s the city development models have been for-profit maximisation through privatisation of utilities, monetisation of land and corporatisation for capital intensive technologies. In this process, the organised strength of the working class has been weakened and more informalisation has crept in.

The first urban commission in 1988 visualised the city’s development linked with manufacturing and industrialisation. The current scenario is more service-driven where the bargaining power of the workers' vis–a–vis the State apparatus has shrunk. The basic necessities that were considered as essential delivery by the State are being privatised. Housing, water, health, education and such other sectors saw massive privatisation, both vertical and horizontal. This has led to a phenomenal gap between the rich and the poor.

Another important feature is massive migration from urban to urban and rural to urban. According to the World Bank, there are nearly 450 million migrants in India, however rural to urban migration is nearly 52 million according to 2011 census which is jump of 6.5 per cent and an equal number migrate from urban to urban. The figures for 2021 census will certainly be far more than this.  There is no concrete policy for migrants. The social security net, though weak is completely missing the migrants and whence the lockdown was announced they could not stay even for 24 hours in the cities as they knew that they will starve to death had they stayed back.

Nearly 21 million salaried jobs were been lost during the lockdown out of a total of 87 million i.e., almost 25 per cent; the worst affected section were white-collar professionals such as engineers, physicians and teachers. Six million such jobs have been lost which is 31 per cent of all white-collar jobs.

The second worst affected category of salaried employees were industrial workers. 26% of their jobs have been lost. This decline is most apparent in small industrial units because the MSME sector was badly affected by the lockdown. The employment rate had come down from 39.5 per cent in 2019-20 to 38 per cent(October 2020). That means 1.5 per cent of a billion people i.e., around 15 million lost their jobs during this period.

Another important feature during the lockdown was a fall in the gross value addition which saw a contraction in various sectors of the economy thus leading to unemployment/ decline in employment: The worst affected were construction (–50%), trade, hotels and other services (–47%), manufacturing (–39%), and mining (–23%). It is important to note that these are the sectors that create the maximum new jobs in the country. In a scenario where each of these sectors is contracting so sharply — that is, their output and incomes are falling — it would lead to more and more people either losing jobs (decline in employment) or failing to get one (rise in unemployment).

The unemployment rate had spiked to 24 per cent in April 2020 soon after the lock down was announced and the urban labour participation rate fell from 40.46 in January 2020 to 32.47 in April 2020. However, for urban male it fell from 65 per cent to near 40 per cent during the same period(Global  LFPR is more than 70 per cent; and this shows the precarious condition in India- there are hardly any jobs).  According to Suresh Babu and Chandan in The Hindu, informality continues to undermine the prospects of reducing working poverty. The pandemic and association policy responses have exposed the vulnerability of these urban jobs.

During this period salaried job holders from sectors like hospitality, real estate, construction, retail, SMEs and ancillary manufacturing units have contributed to unemployment.

The urban employment guarantee scheme must be launched in all the urban centres to arrest rising joblessness. Urban employment continues to be near 10 per cent. There should be an investment in infrastructure and that too not with large capital-intensive technologies but labour-intensive approach for municipal infrastructure.  Some of the work in urban employment can be linked to large scale rejuvenation of water bodies in the urban centres. Most of these water bodies are neglected and the focus happens to be on supplying water from long distances. The capacity of the rural economy to absorb workers who returned from cities is low and the viability of agriculture to provide these workers with a decent living is questionable.

The push is for more market-oriented housing. Since 2014 public housing dropped from six per cent to three per cent. It should not be less than 25 per cent in any given situation for inclusive housing. No wonder that nearly 50 million people are without houses(including those living in dilapidated houses). The proliferation of slums continues unabated. Nearly 40 per cent of the urban population lives in slums in large cities. The 2011 census puts it to near 20 per cent a World Bank estimates nearly 35.2 per cent living in slums.

Nearly 40 per cent live in single room houses and 75 per cent in two rooms, whereas the average size is not more than 25 square metres.  The PMAY scheme for housing fell short of its target. In 2020-21 only 5.4 per cent of the houses were sanctioned. There are four verticals in PMAY. In ARHC i.e., affordable rental housing 80,369 houses were supposed to be built, only 1,703 were constructed.

Interestingly the JLL(commercial real estate company) survey 2020 shows that 0.46 million(4.6 lakh) properties(houses)worth $550 billion( Rs 40 lakh crore) are ready but there are no buyers. In another report, 13 lakh houses worth Rs 9.38 lakh crore, which is about five per cent of India’s GDP are lying unsold. Likewise, the RBI has estimated that 0.95 million( 9.5 lakh) properties(houses) worth Rs 80 lakh crore is stuck in the construction process. This shows the conditions and changes in the housing patterns in India.

According to the Economic Survey, the unorganised sector comprises 93 per cent of the workforce. This sector was most affected during the pandemic as there was hardly any social security net available for these workers.

About 80 per cent of the workforce in the country is in the informal economy. According to government figures, four per cent of these are contract workers. Only one in five has a monthly salary job. Half of the workforce is self-employed. These are shopkeepers, hawkers, salon runners, bicycle repair cobblers, etc. They have been the worst affected once the lockdown was announced. Actually, every sector in the economic system is connected to another.

During this period the state’s social structure was also lacking. According to two primary surveys done by civil society groups, 83 per cent of the total relief camps were run by non-state actors and only 17 per cent by the state governments. In a sample survey of 4,763 migrant workers from Delhi who migrated back during the lockdown; 86 per cent were living in rented JJ(jhughijopdi) colonies-slums. Only four per cent had a place to stay at their worksite. In another large survey of over 11,550 workers across India who migrated back, 80 per cent were wage, factory/construction workers. Daily average wages were between Rs 400-Rs 460; 72 per cent had ration in store for just two days; 89 per cent were not paid wages during the lockdown; 75 per cent lost their livelihoods and 53 per cent were bearing additional debt burden. They hardly had any assets along with them.

Even the middle-class sections were badly hit. In various condominiums in a city like Gurgaon, the maintenance costs per house have gone up to Rs 7,000 from Rs 5,000. Likewise, for electricity, the per-unit cost is charged at Rs 21 which earlier was Rs 17.

There is a huge debt that the urban workforce is caught in. The household debt jumped from 32.5 per cent in 2018 to 38 per cent in 2021.

The XVth Finance Commission has made this amply clear that those cities/town that does not start collecting and incrementally increasing their user charges on properties in the form of property tax will lose their grants. Already Tamil Nadu and Andhra Pradesh are reeling from the pressure of surmounting property tax charges. Along with that, there is a secured incremental increase in utility charges on water, sanitation.

Likewise, the use of capital intensive technologies in urban mobility, sanitation(focus on large STPs & waste to energy plants) is debt on the people. They are forced to pay the enhanced user fees for the operation and maintenance costs in the form of tipping fees to such plants. The water utility is another area after sanitation that is being targeted by the Modi government for abject privatisation. Under the Jal JivanMission(JJM) the target is to provide potable tap water to every house by 2024. Absolutely necessary and fine. But the way this is being done is quite contrary to the intent- the provisions do not match the intent. The model being emulated is Telangana’s Mission Bhagirathamodel, which has spending of over Rs 50,000 crore and 80 per cent of the money is borrowed from the market. The capital investment and operation management are with capital intensive technologies.

The JJM proclaims for equity participation- willingness to pay for services; making water everyone’s business. The transition of water management from the principle of ‘water is a right’ to ‘water is a need’ is evident in JJM and the need can be fulfilled by any service provider-private or public!

Master plans of a few large metros are being updated. Delhi MPD 2041 is in the process. There is a dramatic shift in these master plans. Two states have interesting developments. Delhi where this master plan is a shift from the Nehruvian planning model to corporate-driven planning. In the earlier plans (1961 Delhi) there was ample space for urban social housing( LIG’s, Janta Flats etc.), though never accomplished. However, the new draft plan is more focussed on TOD(Transit Oriented Development). In fact, TOD is going to be the new mantra for urban development. Though it speaks about urban mobility with strong interconnections of housing, again it is focussed on middle-class urban housing and no scope for the poor and the working class. TOD is actually land monetisation and this is what will be witnessed across the urban spectrum in years to come. AIIMS redevelopment, metros, etc., are a little glimpse of this.

Another state that portrays the urban development model with principles laid out by multilateral agencies is Tamil Nadu where the World Bank is instrumental in guiding the urban development trajectory. Water, housing, etc., will be seen through the same prism of monetisation. Street vendors removal, slums eviction, property tax issues are all part and parcel of this design.

Likewise, spending on health, education is squeezing. Venture funds are entering the education sector with more digitalisation. Only 27 per cent of Indian households have access to the internet. For urban households, the percentage is higher but completely inadequate to meet the universalisation of education standards.

The National Health Mission which is insurance-driven faltered badly during the pandemic. With India’s public health spending less than 1.5 per cent of GDP, the Economic Survey recommends a minimum spending of three per cent, however, the government is more interested in the private sector taking over this important sector. Public spending on the health sector is quintessential for the well being of the people. Hence in city planning, not community health centres or primary health centres, but more super speciality hospitals are witnessed, which robs the common people further.

The central vista re-development project is another important project in Delhi that is pushed by the prime minister for a new parliament building and rather a large mansion for himself with nuke bunkers etc. Worth more than Rs 20,000 crore is a complete vanity project which not only shows the abject insensitiveness of the government but also exhibits the sheer despotism of urban governance.

These forms of urban development strategies are unsustainable and will lead towards more alienation of the people and will further enhance their miseries.