A recent report, the Inequality Virus Report, by Oxfam International has discovered that the Covid-19 pandemic has exacerbated existing inequalities both in India and globally. This significant determination indicates that Covid-19 could increase economic inequality in nearly every nation, a event unprecedented since record keeping began over a hundred years ago.
Impact of the Pandemic on the Wealthy vs. the Poor
With the implementation of one of the earliest and strictest lockdowns, India’s economy came to a standstill. This lockdown led to widespread unemployment, distress migration, hunger, and pervasive hardship. The economically privileged population was largely insulated from the pandemic’s harshest effects as white-collar workers transitioned to remote work. However, a majority of less fortunate Indians lost their livelihoods as Indian billionaires’ wealth soared by 35% during the lockdown and 90% since 2009 to $422.9 billion. This wealth gain placed India sixth globally for wealth accumulation, following the USA, China, Germany, Russia, and France.
The Toll on the Informal Sector
The Indian informal sector, which accounted for about 75% of the 122 million job losses, was particularly affected. These informal workers had fewer opportunities to work remotely and experienced more significant job loss compared to the formal sector. Especially affected were the 40-50 million seasonal migrant workers employed on construction sites, factories, etc.
Educational Impact
As education turned increasingly digital over the past year, inequalities deepened due to the digital divide in India. Although private service providers saw exponential growth, only 3% of India’s poorest 20% of households had computer access, and just 9% had internet access. A prolonged disruption of schooling could potentially double the rate of out-of-school children, primarily impacting poverty-stricken households.
Health Inequalities
Absence of socioeconomic or social category data in India’s Covid-19 case records makes it challenging to assess disease distribution among various communities. However, with the world’s second-largest cumulative number of Covid-19 positive cases, poor, marginalized, and vulnerable communities are observed to have higher rates of Covid-19 prevalence. The spread of the disease was accelerated in these impoverished communities living in overcrowded conditions with inadequate sanitation and shared common facilities.
Sanitation Discrepancies
Only 6% of the poorest 20% of households had access to non-shared sources of improved sanitation, compared to 93% of the top 20% households. Regarding caste, just 37.2% of Scheduled Castes (SCs) households and 25.9% of Scheduled Tribes (STs) households had access to non-shared sanitation facilities, compared to 65.7% for the general population.
Gender Disparities: Employment and Health
The unemployment rate among women rose from 15% pre-Covid to 18%. This rise could lead to an 8% loss to India’s Gross Domestic Product (GDP), or around $218 billion. Furthermore, 83% of women retaining their jobs experienced a reduction in income. Women also suffered health-wise due to disrupted regular health services and closed Anganwadi centres, predicting 2.95 million unintended pregnancies, 1.80 million abortions (including 1.04 million unsafe abortions), and 2,165 maternal deaths.
Domestic Violence Increase
The pandemic has also seen an alarming increase in domestic violence against women. Cases rose by nearly 60% over the last 12 months, as of November 2020.
Proposed Remedies
To address these disparities, Oxfam advises an urgent need for policymakers to tax wealthy individuals and corporations, using that revenue to invest in free quality public services and social protection. While reducing inequalities is a crucial medium-term target, India needs to prioritize growth before distribution to avoid a low-income equilibrium trap.
About Oxfam International
Oxfam International, established in 1995, is a group of independent non-governmental organizations. It originated from the Oxford Committee for Famine Relief, founded during World War II to provide food supplies to starving women and children in enemy-occupied Greece. The organization aims to maximize efficiency and reduce global poverty and injustice. The Oxfam International Secretariat is headquartered in Nairobi, Kenya.
