In an interview, Finance Minister T.M. Thomas Isaac talks on the lockdown and plans for economic revival.
It is a situation where the supply chains have been severed. Therefore, we are carefully working on a plan and agriculture would be the first sector to be eased from the lockdown. Kerala has relatively small parcels of farmland and we are encouraging kitchen gardens. But that will now have to be expanded to other crops because it is possible to continue social distancing while doing farming except in certain segments.
But to do that, we will have to have a moratorium on farmers’ debt. We may have to subsidise farming to kick-start production. This is also the time for Kerala to bring in agriculture processing industries where we are woefully behind. We could start by asking cooperatives to start procuring coconut and set up processing units. Further, cottage industries such as coir where spinning is done in households can restart.
Then you have sectors such as tourism that will take a long time to be normal. There is no way it can be reopened in the next three or four months. Foreigners should have the confidence to come here. You have to strategise in the long-term. But we intend to start a campaign right away after the lockdown is over, showcasing a resilient Kerala. Showing how we have tackled COVID-19. This is to welcome them when we open up after the rains or during the boat race season.
Taking the lead
The industries that will lead the post-lockdown stage will be those contributing to health care. The public sector Kerala State Drugs and Pharmaceuticals (KSDP) is expanding in terms of infrastructure and capacity. A small company with a turnover of ₹25 crore to ₹20 crore, it will have manufacturing capacity worth ₹250 crore by year end. It is waiting for a licence for mass production of medicines needed by patients going for organ transplant.
If the daily cost of their pills is ₹250 outside, the facility can produce them at ₹30 or ₹40. We intend to form a pharma consortium with private sector participation for production of drugs and medial devices.
The only problem in medicine manufacture now is non-availability of chemicals as pharma companies are all dependent on Chinese supplies. Hopefully, the supply lines will be reactivated.
Debt trap
While the States are on the front line fighting the pandemic, the Centre is pushing them into a debt trap. When the Reserve Bank of India has slashed rates, why should the States be forced to pay higher interest rates for market borrowing? Ideally, the Centre should borrow from the RBI and make money available to States. The suspension of MPLADS funds also signals not just truncated decentralised expenditure. The money taken from this goes to a consolidated fund of India and not to a COVID fund.
Salary challenge
We have no intention of cutting or deferring salaries of employees. We will soon issue a comprehensive order with exemptions granted to certain sectors and may add some incentives to people who are participating in this.
Relief package
Primarily, it is a health crisis with a big economic fallout. We have done well so far to contain the spread of the infection. But we will wait till April 13 to gauge the situation as we do not want to do anything that might undermine our accomplishments in containing the spread.
We do not want to risk a community spread, whose consequences can be terrible. Therefore, it does not matter what is the cost involved in flattening the curve. That said, for a lockdown to be effective, people must comply with it and actively participate in the process. That is why we instilled confidence in them by rolling out a relief package and ensured food and essentials to all.
