Adapting to a Post-Covid World

Categories
Yojana/Kurukshetra
Published
24th Dec, 2020

The post-Covid world that emerges from this crisis will not be a mildly-altered version of pre-Covid world.
This new world will have its own geo-politics, supply chains, technological innovations, institutional structures, consumer preferences and so on.
All of these factors will interact in multiple, unpredictable ways.
So, how can one prepare for an uncertain new world? Rather than invest in a rigidly master-planned response, it is better to invest in two things: flexibility and resilience. This is the context in which recent supply-side reforms need to be seen.
The agriculture sector reforms frees up farmers to sell their produce as they wish while those involved in the supply chain can invest in storage without fear of being labelled "hoarders".
This will allow the farm sector and farm-related industries to adapt their activities to changes in demographics, climate change, consumer tastes and so on.
India has the world's second largest stock of cultivable land and there is no reason it shouldn't be an export powerhouse in agriculture.
Similarly, dozens of central labour laws have been reduced to four internally consistent codes. On one hand they strengthen laws related to safety and working conditions, on the other hand they allow employers greater flexibility.
Again, this is important for an unpredictable, evolving post-Covid world where the economy needs to be able to efficiently redeploy the workforce according to changing conditions.
Other recently announced reforms related to bilateral netting, and trade finance factoring are also directly aimed at improving the flexibility of the financial system.
The other ingredient of the longer term post Covid framework is the emphasis on resilience.
Vision includes increased participation in global supply chains as well as a greater encouragement of FDI.
India’s globally competitive pharmaceuticals industry was found to be too dependent on critical imported inputs with supply lines that can be easily disrupted. Hence, an effort is being made to bring some of the input production back to India.
A big effort is being made on digitisation of records, the use of online applications and the rationalisation of defunct government bodies.