As the world continues to be ravaged by the covid pandemic, more than a year on, it is becoming increasingly evident that the greatest burden has fallen on the global poor.
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Even the poor in rich countries, which have relatively secure social safety nets and well developed public health systems, have seen a sharp drop in incomes and suffered the hardest impact of the virus itself, since they are not in occupations in which work-from-home is feasible.
While an investment banker, a senior civil servant or university professor can safely work remotely, this is obviously not an option for a food-delivery worker, a store clerk, or a front line medical worker.
If the impact on the poor in rich countries has been severe, in lower and lower middle income countries, it has been nothing short of devastating. A recent study by Pew Research Center compares the impact in China and India.
While China’s gross domestic product (GDP) rebounded in 2020, after an initial drop on account of the pandemic, India’s GDP collapsed last fiscal year, but is projected to revive in 2021-22. This difference helps account for the big difference in impact on the poor in the two countries.
Pew’s methodology is a counterfactual one—that is, it computes the change in the number of poor and those in other income strata as compared to a scenario of normal GDP growth in the absence of the pandemic and subsequent lockdowns.
In other words, this is a conceptually clean methodology for determining the pandemic’s impact on poverty. The survey’s definition of those in poverty is the standard international definition of a daily income (actual or imputed) of $2 or less.
For China, the study shows a very modest increase in the number of people in absolute poverty—only a million or so—whereas 30 million more people were pushed into the low-income (but not absolutely poor) category. Meanwhile, 10 million people fell out of the Chinese middle class, 18 million from the upper middle class, and 3 million from the high-income category.
By contrast, for India, a staggering 75 million people were pushed back into poverty by the covid crisis—this is almost 60% of the global total increase in poverty caused by the pandemic. India’s lower middle income category lost 35 million people, and the country’s middle class shrank by 32 million, many of these, evidently, accounting for those who slipped back into poverty.
Additionally, there was a loss of 7 million people from the upper middle class, and a drop of 1 million from the count of high-income earners.
The covid crisis in India has undone years of progress in combating poverty and also reversed several years of gains in drawing those in lower and lower middle income groups into the country’s middle class.
If these statistics are not grim enough, there is now added concern globally of a looming sovereign debt crisis, especially in middle- income emerging countries. In a 29 March interview with the Financial Times, United Nations secretary-general António Guterres pointed to the fact that large, middle-income countries such as Brazil and South Africa have borrowed heavily in domestic bond markets.
There is little danger of an external debt crisis, but there is a danger all the same, as maturities are coming down in many large middle-income countries such as Brazil and South Africa.
Shortened maturities may reduce the interest service cost of debt, given how low short rates are, but they mean that borrowings must be rolled over more frequently, which can heighten the possibility of a crisis in a context of greater macroeconomic instability.
While India is not in such crisis territory, unrestrained fiscal profligacy and an increasing debt-to-GDP ratio can add to macroeconomic pressures in the not-so-distant future, especially if rising retail inflation forces the Reserve Bank of India to raise its policy rate to damp it down, thus raising borrowing costs.
Taking a longer view, the global crisis and its aftermath have impeded the process of economic convergence between richer and poorer economies, a beneficial impact of globalization that had been in train, at least in fits and starts, since the 1990s.
India, in particular, suffered a serious GDP contraction last year, and even the prospect of higher growth this year, which could give India back its crown as the world’s fastest growing major economy, has reduced the chances of achieving the government’s putative goal of making India a $5 trillion economy anytime soon.
Even a month or so ago, there was somewhat greater optimism, thanks to vaccine rollouts around the world, over a reduction in the covid infection rate in many countries and the easing of pandemic restrictions. However, cases are again on the rise in many places, and new variants and mutations of the virus appear to be more resistant than earlier thought to our existing vaccines.
India, in particular, is seeing an alarming increase in cases and increased stress on its healthcare system. If this necessitates renewed curbs and lockdowns, as have been imposed partially in some states, it will almost certainly lead to a significant downward revision in India’s growth forecast for the current fiscal year.
Lower growth, in turn, foretells a rather grim year ahead for India’s poor.
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- Lowering Emissions by Accelerating Forest Finance (LEAF) Coalition, a collective of the United States, United Kingdom and Norway governments, came up with a $1 billion fund.
- LEAF is supported by transnational corporations (TNCs) like Unilever plc, Amazon.com, Inc, Nestle, Airbnb, Inc as well as Emergent, a US-based non-profit.
- The world lost more than 10 million hectares of primary tropical forest cover last year, an area roughly the size of Switzerland.
- Ending tropical and subtropical forest loss by 2030 is a crucial part of meeting global climate, biodiversity and sustainable development goals. Protecting tropical forests offers one of the biggest opportunities for climate action in the coming decade.
- Tropical forests are massive carbon sinks and by investing in their protection, public and private players are likely to stock up on their carbon credits.
- The LEAF coalition initiative is a step towards concretising the aims and objectives of the Reducing Emissions from Deforestation and Forest Degradation (REDD+) mechanism.
- REDD+ was created by the United Nations Framework Convention on Climate Change (UNFCCC). It monetised the value of carbon locked up in the tropical forests of most developing countries, thereby propelling these countries to help mitigate climate change.
- It is a unique initiative as it seeks to help developing countries in battling the double-edged sword of development versus ecological commitment.
- The initiative comes at a crucial time. The tropics have lost close to 12.2 million hectares (mha) of tree cover last year according to global estimates released by Global Forest Watch.
- Of this, a loss of 4.2 mha occurred within humid tropical primary forests alone. It should come as no surprise that most of these lost forests were located in the developing countries of Latin America, Africa and South Asia.
- Brazil has fared dismally on the parameter of ‘annual primary forest loss’ among all countries. It has lost 1.7 mha of primary forests that are rich storehouse of carbon. India’s estimated loss in 2020 stands at 20.8 kilo hectares.
- Between 2002-2020, Brazil’s total area of humid primary forest reduced by 7.7 per cent while India’s reduced by 3.4 per cent.
- Although the loss in India is not as drastic as in Brazil, its position is nevertheless precarious. For India, this loss is equivalent to 951 metric tonnes worth carbon dioxide emissions released in the atmosphere.
- It is important to draw comparisons between Brazil and India as both countries have adopted a rather lackadaisical attitude towards deforestation-induced climate change. The Brazilian government hardly did anything to control the massive fires that gutted the Amazon rainforest in 2019.
- It is mostly around May that forest fires peak in India. However, this year India, witnessed massive forest fires in early March in states like Odisha, Uttarakhand, Madhya Pradesh and Mizoram among others.
- The European Union’s Copernicus Atmospheric Monitoring Service claimed that 0.2 metric tonnes of carbon was emitted in the Uttarakhand forest fires.
- Implementation of the LEAF Coalition plan will help pump in fresh rigour among developing countries like India, that are reluctant to recognise the contributions of their forest dwelling populations in mitigating climate change.
- With the deadline for proposal submission fast approaching, India needs to act swiftly on a revised strategy.
- Although India has pledged to carry out its REDD+ commitments, it is impossible to do so without seeking knowledge from its forest dwelling population.
Context:-
At the recently concluded Leaders’ Summit on Climate in April 2021, Lowering Emissions by Accelerating Forest Finance (LEAF) Coalition, a collective of the United States, United Kingdom and Norway governments, came up with a $1 billion fund plan that shall be offered to countries committed to arrest the decline of their tropical forests by 2030.
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Why LEAF Coalition?
Brazil & India
According to the UN-REDD programme, after the energy sector, deforestation accounts for massive carbon emissions — close to 11 per cent — in the atmosphere. Rapid urbanisation and commercialisation of forest produce are the main causes behind rampant deforestation across tropical forests.
Tribes, Forests and Government
Disregarding climate change as a valid excuse for the fires, Indian government officials were quick to lay the blame for deforestation on activities of forest dwellers and even labelled them “mischievous elements” and “unwanted elements”.
Policy makers around the world have emphasised the role of indigenous tribes and local communities in checking deforestation. These communities depend on forests for their survival as well as livelihood. Hence, they understand the need to protect forests. However, by posing legitimate environmental concerns as obstacles to real development, governments of developing countries swiftly avoid protection of forests and rights of forest dwellers.
For instance, the Government of India has not been forthcoming in recognising the socio-economic, civil, political or even cultural rights of forest dwellers. According to data from the Union Ministry of Tribal Affairs in December, 2020 over 55 per cent of this population has still not been granted either individual or community ownership of their lands.
To make matters worse, the government has undertaken systematic and sustained measures to render the landmark Scheduled Tribes and Other Traditional Forest Dwellers (Recognition of Forest Rights) Act, 2006 ineffective in its implementation. The Act had sought to legitimise claims of forest dwellers on occupied forest land.
Various government decisions have seriously undermined the position of indigenous people within India. These include proposing amendments to the obsolete Indian Forest Act, 1927 that give forest officials the power to take away forest dwellers’ rights and to even use firearms with impunity.
There is also the Supreme Court’s order of February, 2019 directing state governments to evict illegal encroachers of forest land or millions of forest dwellers inhabiting forests since generations as a measure to conserve wildlife. Finally, there is the lack of data on novel coronavirus disease (COVID-19) deaths among the forest dwelling population;
Tardy administration, insufficient supervision, apathetic attitude and a lack of political intent defeat the cause of forest dwelling populations in India, thereby directly affecting efforts at arresting deforestation.
Way Forward
Tuntiak Katan, a global indigenous leader from Ecuador and general coordinator of the Global Alliance of Territorial Communities, aptly indicated the next steps at the Climate Summit:
“The first step is recognition of land rights. The second step is the recognition of the contributions of local communities and indigenous communities, meaning the contributions of indigenous peoples.We also need recognition of traditional knowledge practices in order to fight climate change”
Perhaps India can begin by taking the first step.