What Kerala’s Covid-19 Strategy Can Teach The Centre

Kerala has only 34 active cases and no new Covid-19 patient reported in two days now. Yet, as per the central government’s zoning plan, social and commercial activity remains restricted across most of the state as 12 of 14 districts are either red or orange, only two are green. “We have been trying to tell Delhi that there is a lot of flexibility required,” Thomas Isaac, Kerala’s finance minister said even as he described the flexbility the state has given to local governments in managing health and social services. “We cannot be micromanaged from Delhi,” he told BloombergQuint when asked how states would administer the centre’s new zoning policy.On May 4, India began a gradual exit from the over 40-day nationwide lockdown imposed by Prime Minister Narendra Modi’s government. The exit comes with a central zoning plan (red, orange, green) based on the number of Covid-19 patients in each district, and a central activity sheet. So for instance, while all social, commercial activity can resume in green zones, public transport buses can seat only at 50 percent capacity. In orange zones, cabs can run with one passenger only. In red zones only essential activities have been permitted.While the circulars do afford states some flexibility they come with warnings. “State/UT governments shall not dilute these guidelines issued under the Disaster Management Act, 2005, in any manner, and shall strictly enforce the same.” Hence, restrictions can be enhanced not relaxed.Kerala may be an outlier, given its higher literacy levels and sustained investment in local healthcare infrastructure, its success in containing the virus spread, as narrated by Isaac below, underscores the one critical thing needed to win the battle — devolution of power.....what I would argue is that the central government should have only a broad framework within which the exit plan should be framed by the local government, state governments.Thomas Isaac, Finance Minister, Kerala.In this interview Isaac discusses Kerala’s exit strategy in contrast to the central one.Preventive and containment approachReverse quarantiningPreparing for a second waveResumption of commercial and industrial activityWhy Kerala has not yet opened liquor storesThe state’s industrial and economic revival plan.Listen to the full conversation here.Edited excerpts.How Kerala Contained The Virus, And Will The Centre’s Exit Strategy Work?.What you make of this red, orange, green zone strategy and how easy or difficult it is for states to coordinate with the centre in being able to administer it..I think there are several features of the strategy we deployed which needs to be discussed. I don't think it has adequately been discussed.One, of course, like the rest of the country, we are focusing upon a preventive approach, containment strategy. Now there are a whole lot of debates going on regarding the level of testing. Now, it is circumscribed by the number of kits that they can have which are scarce and so on..Therefore, while in Kerala the number of tests are significantly above national average, the way we administered the tests is very important. .We have been focusing on quarantining; any positive case you trace all the contacts, have them all quarantined, either in the house or institutional, and keep them under strict observation. We don't immediately test them all because the results of the test can be known only after a few days, after the incubation period. Therefore, testing negative doesn't mean that you are not infected. Therefore, our focus has been on quarantining them, under strict observations and if there are symptoms, then you immediately test them. Otherwise we have been keeping many people, if there are no symptoms, we quarantine them for 28 days. So even an asymptomatic case is staying in for 28 days, they would be clean by the time they come out. So we know the number of tests is above national average, that has been done with care and focus. Therefore, the number of cases in Kerala, secondary infection is very low - 0.4 percent, while national average I guess would be 2. The R0 is also very low. Therefore, I think this has played a very important role.Now, second, we have been also taking care of the general population- via income transfer to them. We have transferred, income transfer itself, as a small state, something like Rs 8,000 crore. This process is going on. Now, every family in Kerala will have received some support. This is very important to keep up the morale.And, to keep up the morale, we have been encouraging them to read, online festivals and quizzes home for children, etc. In fact, in my constituency even the aged grannies they come for competitions, festivals, everything online - you have to record it, share on Whatsapp with jury/judges etc. We have been encouraging everybody to take up cultivation, a kitchen garden. Not in the field as such. In Kerala, the settlement pattern is very peculiar. Every house is not clustered together, but spread out. Everybody has at 10 or 20 or 25 cents of land and there's a house in the middle. Everybody has a little bit of homestead land. So we have been encouraging them to take to cultivation and it's very important to keep people engaged. You cannot just shut people in the house and say they will take care of themselves. So, this has also been done.If there is lack of food in the house, there are community kitchens who supply the food to them. So this is also very important to create an environment where people are in the battle and they feel they're also in the struggle against the epidemic.All this has been made possible via two agencies. One is the health department. The public health system in Kerala is very strong. It is in the public health system that this present government has made the biggest investment. Say, our investment in the last four years would have been something of the order of Rs 6,000 crore. I mean not just any expenditure, this is for buildings, equipment and so on. We have appointed, just check now, more than 5,000-5,500 doctors, nurses and paramedical staff.Because we have the experience of Nipah virus, we have a committee which looks out for even pathogen X - unknown viruses, anywhere, we track it. So the moment Wuhan came into the newspapers, immediately all our systems got activated. Control rooms, people to study that, time to see how many Malayalis are there. There was a group of Malayali students in Wuhan so we were ready. The preparedness of this health department has been amazing.Then there is another agency, there is the local government and they are very powerful. In fact, I would say I envy them they're much more comfortable in money things than me in the state government. Because no governments- either left or right would ever dare to touch the devolution to local governments. That is not acceptable. They have money, there have resources and personnel, and they manage it at the local level..How can a government sitting in the capital plan something in the distant corner? .So, this is it. These are the broadly the factors that enabled us today to just 34 cases only. It has come down from confirmed cases of 500, it comes to 34. I'm looking forward to seeing in a day or two Kerala sliding down to single digits. I think that would be a very creditable achievement. So we are doing that.We know the worst is going to come. That's when all the migrant Malayalis all over the world- there are more than 100 Malayalis that have died in the Gulf, Europe and the States. Death toll in Kerala is three. Therefore, everybody thinks it is a safe haven they want to come back and we can’t say no, we have to get accept them. But it has also implications, huge implications for the epidemic. So, well, this is it now. This is our moment now, we are preparing for the second wave..You’ve described Kerala’s efforts in detail. Do you think, from a broader national perspective, this red, orange and green zone approach, is a reasonably realistic administrable effort?So, personally, I think we have got to learn to live with Covid virus. It is going to be a part of our lives for some time to come, maybe a year? I can’t say. Therefore, that's my first statement.But the spread should be unrolled in manageable limits. See, you can have a pandemic spread where your hospital facilities cannot treat those who are ill. So definitely, the opening up would have to be limited by the number of health facilities you have, number of patients you can treat. You have to keep to that. That’s to say, if it goes near to that level then you have to clamp down. Now, in Kerala, our confidence is there is no community spread. That is because people are quite aware of it; anybody gets a fever, they immediately report to the Public Health Centre. You cough loudly in the house, somebody will phone up the PHC. So that's the kind of health awareness. Therefore, we think we can do that..What we are planning therefore is a process of reverse quarantining. .There would be some cases going on, we are not going to eradicate it. The virus is out there. So what do you do? You protect the vulnerable. For Keralites that would be a very large number, some 30 lakh minimum. We are preparing the list; everything, every house. I can speak because I work at the micro level also in my constituency. We have the health record of all the citizens digitalised- blood pressure, sugar level, cholesterol level, height and weight. We have screened them for various illnesses and so on. Therefore the panchayats are going to deliver a notice to every household - that these people are vulnerable and they should stay in the house.Once they stay in the house, it means there should be facility for tele-medicine. Medicines should be delivered to their house. If there is no food you provide the food for them. There may be counselling required, palliative care required. The local governments would take initiative for that. So, reverse quarantining of all the vulnerable section is the most important. We will ensure that even when we open up, we are not going to give our vulnerable sections to the disease. No, we will not.Second, these people who come from outside, they will have to stay quarantined. Not just 14 days. Normally we keep them for 21 days, for 28 days and see if any symptom is there and then test them. This is going to be a huge thing. We have prepared about 2.5 lakh accommodations in various hotels - under Disaster Management Act we’re taking them over, even houseboats. So that’s second, that these people will be kept under strict observation.Third is, able bodied should go out and work while keeping social distance. We call it physical distance, we don't call it social distance because when this pandemic started, some people were using it to justify the age old custom relating to upper system keeping a certain distance from lower castes. Therefore we call it, physical distancing and social unity. That's the slogan of Kerala.Now, people are using so many innovative ways. I have got a panchayat in my area, where they have decreed that everybody going out to the house has to carry an umbrella. If you don't have an umbrella, then you can get it for a concessional rate and they have installed this through self-help groups. So, if everybody carries an umbrella, even while walking in the night, then you will ensure everybody really keeps a distance of one foot or one metre from each other. And there are masks, sanitiser.Also, within the workshops and the factories, it is a relay of production systems that you keep distance from each other. Even protocols for employment guarantee programmes that you keep distance from each other. So this also has to be done very systematicallyNow, with this you will go back to not a full level but 30-50 percent of the normal types of economic activity, this is our exit plan.Kerala has 2 red zones, 10 orange zones and 2 green zones, which indicates that a full resumption of activity can happen only in two of the 14 zones, according to the central guidelines. There are also all these DOs and DON’Ts - for instance, the number of passengers that can ply in buses in green zones, the number of passengers that can ply in cabs in orange zones, and of course the clamp down on activity in red zones. Can you give us a sense from a state administration point of view on how easy or difficult it is to comply with any of these things?You see, green, red, orange is not a permanent status. This will rapidly change. You have two, three cases appearing then you go to the red zone and lockdown. But the green zone can continue (activity). Once the recovery takes place, and you move them to orange and out. So, you have to follow a very flexible policy. That's what I'd say. Be vigilant and have a protocol that everyone accepts. A hotspot means total lockdown, but the rest of the district can have certain concessions and so on. So, we have nowprotocols made for that, taking into account what central government has permitted, so people know what is to be done, what cannot be done. So that's very important to have these protocols and advertise them well so that people know it. I'm certain, there is an element of fear that has come, and therefore they would comply with it..So, we have been trying to tell Delhi that there is a lot of flexibility required. We cannot be micromanaged from Delhi. Like in Kerala as I told you, the local governments- we allow them to innovate various things. They have a lot of degrees of freedom on what to do. .For example, community kitchens- we have left to them to decide when to exit from the community kitchen. We had 1,400 community kitchens, of which 400 were closed down yesterday. All these 400 we are converting into budget hotels, run by women group, to get a 20 rupee meal. If you're very hungry and don’t have money still a certain number of meals would be free, subsidised by the government, the rest is Rs 20 per meal. So it is left to the local government to decide how to make this transition..Therefore, what I would argue is that the central government should have only a broad framework within which the exit plan should be framed by the local government, state governments..Post-Covid Industrial Priorities And Why Kerala Hasn’t Reopened Its Liquor Stores.What do you make of the exit strategy from an economic point of view? To augment resources some states have today raised taxes on liquor and fuels.The opening has to be very carefully calibrated taking into account not just government revenue, that's not the primary concern. The kind of impact it will have on the possibility of spread, difficulty of keeping the physical distancing and so on.So, in our state agriculture is permitted, yes, cottage industries and so on.When it comes to construction, we don't encourage a huge massing of people. So construction companies would have to have their workforce spread while undertaking different activities. Normally you have sequential activity going, but that will have to be changed; the normal sequence.Coming specifically to shops, that’s where this problem crops up. We are not going to permit malls or multi-storied shopping malls etc. to be opened. But all the small, petty shops they're open, and with strict times other shops too..We are not opening beverage (liquor) shops for example. Though Kerala as a state doesn’t have prohibition. The simple reason is that we find it really difficult to control the crowd, just as you saw on the television..Of course there will be good money as revenue for the government, but (states have) to ensure a system by which the crowds can be controlled.We want to do that also because there's a cost to have the shops closed. In the first week, there were five to six suicides in Kerala because of withdrawal symptoms. Now we don't hear about it and I am afraid that’s because they might have found alternative sources and that is bad because that creates law and order problems later. Then you can have a hooch tragedy. Therefore there is a social cost to keeping these things closed. At the same time, we have to devise a system which will ensure crowds won’t be there. People are putting their heads together on how to do that. At the same time you don't want to deliver it to the house because there are many people who are concerned about alcoholism in society, genuinely concerned. They would be very critical about it. We don't want to create unnecessary quarrels. So we thought for the time being let them be closed, then we will work it out. Let other things open, then we will open them. So that's the approach that we are adopting.And we are going to put certain priority areas, because now we have a lot of money going into health, preventive and corrective activities. We have to cut expenditure also. There are certain sectors which will be our growth engines in the post pandemic time.Now, Kerala’s healthcare background is very good. Therefore we thought, okay, here's a potential for us, the pharmaceutical industry and medical devices’ industry. Medical devices park in Trivandrum with the help of medical devices Institute, and so on. That is on track. We have already acquired land for a pharmaceutical park in Cochin. We are going to try to bring our public sector, pharmaceutical and others to the consortium so that Kerala produces generic medicine. That's what we want to do. Generic medicine but with a Kerala brand. So, this is a priority area, we are going to put more money, attract private capital, etc.Second, in the post-Covid situation, even after Covid-19 disappears from the face of the earth, information technology’s importance in the production system is going to increase - robots and IT and so on. That's how the production system is going to reorganise- working in the house and so on therefore this is another priority area. We are trying to attract investment from outside. I think there are some people, we have contacts in China and so who want to shift and come to Kerala- it is a safe place..That is one attraction that we are going to put up. That, Kerala is safe; Kerala will take care of you if you come to Kerala. .Third is tourism. Once again building on, riding on our new brand image. Tourism you will start marketing now, it won’t restart till (after) summer, but we are going to start marketing now. So these are our immediate priority areas that we'll be looking for investments.On Kerala - commercial agriculture. We produce only 15 percent of grains and 20 percent of the total food requirements in Kerala. Now, people have moved from agriculture. We used to have homesteads and multiple cropping. Now all labour intensive crops have disappeared. So we are thinking that this is an opportune moment, to bring back Kerala agriculture, homestead cultivation and revive our paddy fields. These are very important ecologically. So, agriculture is going to be a major concern. Already the campaign has started, this is not a bureaucratic exercise. This will be a big campaign and the local governments will also be involved. They are the fulcrum around which this agriculture revival is going to take placeFinally, I cannot explain why, I think the whole consumption pattern in Kerala has been changed and this is generating a lot of waste. But, Covid is bringing in good habits. So, our entire NREGA (rural employment scheme) is going to be focused upon cleaning of our 80,000 kilometre of canals. Kerala is crisscrossed with canals, they are going to be cleaned, that we are going to start immediately. And ensure that all this organic waste is treated and composted in your house. Yeah, it can be done, it is simple. Of course in the cities there are plants where it is being done but the rest of the country, you don't burn up your organic waste. The earth needs it back. Therefore, there's going to be a big sanitation campaign.These are the things from the post- Covid world, so that we exit from this pandemic and be a better Kerala.These are long term plans. My question to you is the exit from the pandemic, also needs be aligned with enhancing the financial ability of states to fight any resurgence in cases, etc. The center has yet to announce any help. Some states have chosen to increase taxes on alcohol and fuel. Is there an interim solution for states that are facing a financial crunch?These are not long term ideas- agriculture sanitation, medical devices, marketing of tourism all starts now with a longer vision.Now, how do you finance this? How do you finance a war? I think one should read what Keynes wrote - How To Pay For The War..You can raise new sources by tweaking that rate or this rate, it can be that. But fundamentally, at least 10 percent of GDP, additional money has to be created; 5-10 percent. I am saying increase the fiscal deficit to 15 percent, nothing happens. The rest of the world is doing that. .So don't ever think of financing this pandemic war by raising that tax and this tax. That may help a bit, I don’t rule it out. But now, what has to be done has got to be done.Therefore, my demand isincrease fiscal deficit ceiling for states to 5 percent,provide guarantee and give compensation cess for GSTadditional Covid grants to statesand states on their own should try to raise the money.At this time with the lockdown everything is closed. So, what other states have done is have a special tax on liquor. That demand is inelastic and that's true, but Kerala already has done it. We have a tax rate of more than 200 percent- which is the highest in the country. So, you cannot repeat what Delhi has done. That will be actually driving everybody into hooch. So, one has to carefully calibrate it. Other commodities - I am against any increase in GST rates.But I am for what the IRS officers, such a maligned set of people, have done..I agree with them fully - you need a super rich tax. They have to contribute to the war. The burden of the compression, squeeze on expenditure and lack of money is borne entirely by the people. Not the super-rich. So therefore it is only justice and equity. Have an inheritance tax and have a wealth tax. I don’t want to say what I will be trying to do in Kerala but there are some things that the states can do. .What we have done is that we have appointed two committees one to study the impact on the economy and the other to study the state finances. So, a team of experts is working on this and they are not going to take it for granted. There will be a plan for that.

What Kerala’s Covid-19 Strategy Can Teach The Centre

Kerala’s success underscores the one critical thing needed to win the battle — devolution of power.

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