Opinion | Fasten your seat belts, get ready to land on Kerala's mountain of socio-economic woes

Opinion | Fasten your seat belts, get ready to land on Kerala's mountain of socio-economic woes
A child wearing mask with her mother at the Cochin International Airport on Monday. Photo: Josekutty Panackal

On January 22, a 24X7 health helpline was launched in Kerala – Disha 1056. That day, the World Health Organisation's (WHO) mission to China hinted at evidence of human-to-human transmission of coronavirus in Wuhan, the epicentre of the global coronavirus outbreak.

The world at large was then in blissful ignorance about a pandemic that would spread its footprint across the globe and wreak havoc. It did and in the process claimed more than 2.5 lakh lives so far.

It was eight days later, on January 30, that Kerala reported its first confirmed case of coronavirus – that of a student from Wuhan.

This indicates an unusual foresight that spurred a massive combat exercise against COVID-19, the disease caused by coronavirus.

Many developed nations did the exact opposite – they gleefully ignored warnings and embraced disaster.

That is why now, four months later, the number of reported cases in Kerala has just crossed 500, active cases are way below the three figure mark at 30 and the number of deaths are just four – which includes a native of Mahe in the Union Territory of Puducherry, geographically sandwiched by Kerala and the sea.

To put that figure in perspective, the death toll in the US is more than 71,000. In India there are 46,000 plus cases and above 1,500 deaths.


To be fair enough, Kerala has done exceedingly well in combating the coronavirus outbreak and the resultant lockdown.

This achievement has been possible also due to the massive social and economic investment in its robust healthcare system as well as the apt handling of a crisis situation by the ruling dispensation.

Agreed, the state had its share of avoidable bickering triggered by partisan politics. But those noises of dissent are unavoidable in a democratic set up.

Daunting task ahead

From May 7, Kerala would start receiving its non-resident population, mostly from the Gulf as India starts the world's largest evacuation process.

Kerala is heavily dependent on its expats numbering around 3.5 million, with the Gulf Cooperation Countries alone accounting for more than 2 million.

As per estimates Kerala expects 3.5 to 5 lakh arrivals from abroad in the first phase.


This poses an economic and social challenge more than the nitty-gritty of the healthcare related anxieties mainly stemming from the fact that death toll of Keralites abroad and in other states is alarmingly high and flirting with the three-figure mark.

Then there is an economic challenge posed by the precarious situation in the oil economies of the Gulf.

Battered by a slump in oil prices, many GCC countries are now staring at, or dealing with, the worst financial crisis ever.

This automatically triggers job losses and would vouch for the World Bank estimate that NRI deposits to Kerala, which is pegged at Rs 1 trillion, would see a downward spiral. That accounts for a third of Kerala's Gross State Domestic Product (GSDP), or the value of its economic activity.

Natural, considering that nearly one in four expats in the Gulf is a Keralite, with the United Arab Emirates accounting for the largest chunk.

Of the approximately 10 lakh Keralites in UAE, nearly 2 lakh – or one out of 5 – have registered their names for returning home, though all of them need not necessarily be tagged jobless.

But that is definitely a grim indicator – economically and sociologically.

Jobs scenario

Economically, because being a consumer state we do not have avenues to accommodate these fellow countrymen. The simple reason is that we do not create jobs.

The state has 37.46 lakh – a tad below four million – job seekers as per the economic review of 2018-19.

Dipping into the data from overseas, which indicate roughly 40 per cent of those who are seeking to return home are blue collar workers, can't we accommodate them?

Perhaps not, because, regardless of inviting the tag of sweeping generalisation, we need to invoke the typical mind set of Keralite blue collar workers – any job is fine anywhere else, but in Kerala, you just can't be 'seen' doing 'odd jobs' – a euphemism for labour intensive work.

Seen is the key word here – you are 'seen' doing odd jobs here but when you are abroad, you are faceless. That is not the case when you cross the seas.

Now, 20 per cent are skilled labourers. They can hope to get employment by creating a pool of their own or via assistance from government – carpenters, masons and electricians can't be done away with.

Then, there are essentially better off employees in the financially upper strata, but again they would struggle to find employment back home due to lack of opportunities and huge income disparity vis-a-vis overseas jobs.

Moreover, they would have made ample investments mostly in real estate. Now, these investments can't be redeemed for the time being because there is not much real estate transaction happening in the entire country post demonetisation.

Reality, real estate and remittances

A comparison of the registration revenue of land deals in Kerala indicate a plunge from Rs 255.35 crore in April 2019 to a measly Rs 4.13 crore in 2020. While lockdown could have had a definite impact, it is another matter that property deals were more or less frozen due to the economic downturn.

And overcoming this difficult scenario, if expats manage to strike a deal that can only be, at best, a distress sale.

Clearly, the options are shrinking because we never had the foresight to visualise a scenario in which our dependence on NRI remittances would take a rear seat.

A sunset clause of sorts, or in this case a policy outline which would have done away with our overwhelming dependence on NRI remittances, was clearly missing. We should have invoked the approach of the UAE, which had gradually embraced diversification and shifted its dependence on the oil bounty.

We never envisaged a scenario in which the dependence on foreign remittances would end or shrink, a phenomenon which we should get used to, soon.

Policy makers would now have to rethink their strategies to first wade out of this crisis and then to open up avenues to create wealth. And jobs.

This is by far the biggest socio-economic challenge the state would have to deal with in its 65 years of existence.

Kerala's health helpline Disha, which means direction, has been clinically effective.

What we now need is an economic helpline, which could spell out a clear direction on the road ahead to building Kerala 2.0. A gigantic task it is, considering that authorities do not have exact data on even NRI numbers, their skill sets and so on.

In a way, the state and central governments are well within their rights to procure such numbers by making expats who seek to return to register on websites of various governmental agencies. A small step en route an absolutely essential giant leap.

Per capita debt of Kerala has crossed the Rs 70,000-mark. This means every child is born with a debt of over Rs 70,000, though this cannot be considered an economic indicator.

Policy wonks say debt is not a sin. Fair enough, but a mountain of debt is a matter of huge concern.

So dear expats, fasten your seat belts, for you are about to land on a mountain of socio-economic woes.

One for the road: A COVID tax on booze will provide the state coffers an instant high, but long term prospects of overindulgence on squeezing cash cows could be disastrous.

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