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Current and former Modi advisors are calling his new ‘liberalised’ vaccine policy a mistake
A member of the PM’s Economic Advisory Council said the procurement aspect of the new policy would lead to ‘confusion, arbitrage, diversion and leakage’.
In mid-April, as vaccine shortages were starting to become apparent and questions were starting to be raised about the Centre’s management of the inoculation drive, Prime Minister Narendra Modi’s government made an abrupt announcement.
India, which at the time had covered less than 10% of its population with one shot, would be opening up eligibility to all adults starting May 1, while also selling vaccines on the open market and making private manufacturers compete with state governments to procure doses.
Many aspects of the new policy were baffling, with little explanation on offer from the Centre for why it was changing tack.
The new approach has been criticised by many, concerned that it fragments the market, since the Centre is no longer the only procurer, with states and private hospitals also competing for doses, and because it features unfair pricing mechanics while leaving important questions of equity in distribution to manufacturers, who have done more communication about the policy than the Centre.
The Indian Supreme Court has also questioned the government’s choice to let private hospitals charge up to Rs 2,400 for two vaccines, suggesting this may face a constitutional challenge on ground of treating citizens equally during a pandemic.
India’s vaccination rate in the first week of the new “liberalised, accelerated” policy, as Modi’s government titled it, has been anything but. The new policy was announced on April 19, and came into force on May 1.
What’s more the criticism has even come from those who have directly worked with Modi on economics and policy matters in the past.
Take Arvind Panagariya, who was hand-picked by Modi to be the first head of the government think tank, NITI Aayog, in his first term. Here is Panagariya, now a professor of economics at Columbia, calling for a U-turn:
“We need to recognise that the recent decentralisation of purchase and allocation of vaccines has been a mistake. Given that the pandemic constitutes a national public health emergency, optimal response to it requires planning, coordination and prioritisation of vaccine delivery at the national level...
It is likely that the government announced the decentralisation policy as a response to a barrage of ill-informed criticisms. But it is something that requires a rethink once the current crisis abates. As a rule, policy reversals should be avoided to minimise uncertainty but when too much of public interest is at stake, course correction must be done. To blunt potential allegations of politicisation of allocations, the government may delegate the authority to an independent group of professionals.”
Then there is Arvind Subramanian, another economic voice hand-picked by Modi as his chief economic adviser in the first term. Subramanian is now a Senior Fellow at the Watson Institute for International & Public Affairs, Brown University, and has, over the last few years, criticised Modi’s current economics team on a number of issues.
His recommendations are similar to many of the criticisms of the new policy: Vaccines should be free and they should be procured by the Centre.
It isn’t just former advisers either. V Anantha Nageswaran, a member of the Prime Minister’s Economic Advisory Council, has also criticised the decision to fragment procurement between Centre and states.
In an article in Mint, Nageswaran and Rahul Bajoria call some aspects of the new policy welcome, but then argue that,
“the current three-tier pricing of vaccines – one for the Centre, another for states and yet another for the private sector – has the potential to cause confusion, arbitrage, diversion and leakage.
The country could have just two prices: one for the government and another for the private sector. This would allow the Centre to procure and distribute vaccines to states, actively supporting their efforts. It will be a good gesture of federalism in these times. Nationwide vaccination, facilitated and financed by the Union government, would be the equivalent of its stimulatory fiscal response to the first wave. States would continue to be responsible for making sure vaccines are not diverted to the black market.”
In a subsequent blogpost, Nageswaran went further, asking “friends active on social media” to tweet the following while leaving them to “decide whom to tag”:
“The Union Government should procure vaccines on its budget at the agreed price (max. Rs. 300) from both the vaccine manufacturers and distribute to States with the latter responsible for preparing the infrastructure for quick administration.
That is both a response to the ongoing second wave, potential future waves and three, it would forestall a major economic disruption for the second year running.”
One can also point to the opinions of R Jagannathan, a pro-government commentator and editorial director of Swarajya, whose most recent piece on the subject begins with the following line, “That we have got our vaccine strategy all wrong needs no elaboration.”
Though it is not quite the same thing, Ashok Malik, policy advisor to the Ministry of External Affairs had thoughts about the current vaccine policy even before the government had announced it:
Finally, Rathin Roy, Managing Director (Research and Policy) at the Overseas Development Institute and another former member of the Prime Minister’s Economic Advisory Council had a much pithier response to the new policy:
