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Absolute Disaster Averted

Author: Arvind Panagariya
Publication: The Economics Times
Date:  June 11, 2021
URL:    https://twitter.com/APanagariya/status/1403268761101258752 

With vaccine decentralisation junked, Gol has restored normalcy to India's inoculation drive

Critics who consider themselves responsible need to come forward and acknowledge their error in attacking a vaccination policy that had been working smoothly

One of the first lessons drilled into any student of economics is that all economic problems arise because of scarcity of resources in relation to human wants. Therefore, during March-April, when commentator after commentator heaped criticisms in the harshest terms on the government for restricting vaccination to the 45-plus age group — thereby denying Covid protection to those below 45 — I was aghast.

Rather than check readily available data, the commentators had simply assumed that India was sitting on an unlimited supply of vaccines, so that only the 'misguided' government policy was keeping those below 45 from acquiring protection against the dreaded virus.

'Twas a Smooth Sailing
 On April 19. the day GoI capitulated and dropped the age restriction, there were 922 million citizens waiting for their second jab. Under the then-prevailing policy they needed this jab within the following eight weeks. Even counting most generously expected vaccine supply over those eight weeks was no more than 140 million doses. With 92.2 million doses to be administered to those who had already received their first Jab, how far could the remaining 47.8 million doses go? Should these doses not have prioritised the vulnerable who were disproportionately among those above 45?

Similarly, critics are now questioning GoI's decision to lengthen the gap between the first and second jabs to 12- 16 weeks. They argue that one dose of Covishield provides only 33% protection against Infection. But they neglect the fact that even with one dose, protection against serious complications and death is far higher than33%. With limited vaccine supply in the short run, the choice is between saving lives of many versus minimising the prospects of even mild infection among a few.

By all accounts, ft was also a barrage of criticisms and pressure from state governments that forced the hand of the central government on decentralisation of vaccination. But as I pointed out in an article (bit.ly/3x7EQ79) soon after the new policy was announced in mid-April, this change, too, was unfortunate.

Vaccination against the coronavirus is a national public good and necessarily requires coordination at the national level. Given the scarcity of vaccines, not everyone can be vaccinated at once. Therefore, vaccination must be carried out in phases to minimise infections, hospitalizations and deaths from future waves. This requires setting priorities across geographical regions and age groups based on vulnerability to the virus.

The original policy had been broadly right for precisely these reasons. Indeed, the centralised allocation-based system had worked smoothly from January to April. In March, I checked with a dozen friends in Jaipur Kolkata, Mumbai and Delhi who had received Jabs. They uniformly praised the service they received in all Its aspects. Vaccination rate at three million a day in April was also close to average daily vaccine availability.

But post-decentralisation, a dysfunctional system came to rule. Though daily production rate during May was nearly three million doses, vaccination toll to half of it. Beneficiary satisfaction dipped dramatically as well.

Oddly but predictably critics took no time in taking a U-turn. Without even so much as acknowledging that It is they who had probably forced the government's hand, they now accused the latter for abdicating its responsibility and passing the buck to the states.

Mind It, It's a You Turn

Thankfully the prime minister has acted in national interest and returned the country to the original policy, with some improvements. It will once again centrally negotiate prices for 75% of all vaccines manufactured and allocate them to states at no cost based on criteria such as population, disease burden and progress on vaccination. States that waste vaccine doses at high rates would see their supplies reduced. Furthermore, the policy would prioritise frontline workers, above-45 population and citizens due for their second dose.

Private hospitals would be free to procure the remaining 25% of the doses manufactured. The maximum price per dose they may charge vaccine recipients is Rs.780 for Covishield. Rs.1,410 for Covaxin and Rs.1,145 for Sputnik V. Walk-in registration would be available at government as well as private facllities.

Vaccination is going to be a multiyear project. Back-of the-envelope calculations suggest that covering the entire above-18 population alone would require more than eight million jabs a day during the second half of 2021. If the policy were extended to those below 18, more jabs would be required.

Though GoI has finally mobilised to scale up production in a major way, it remains to be seen whether output would rise to eight million plus doses a day during July-December 2021. Even if it does, the vaccination drive will have to continue to administer booster doses once the protection from initial two doses dissipates.

Finally critics who consider themselves responsible need to do some soul searching of their own. Minimally they need to come forward and acknowledge their error in attacking a policy that had been working smoothly. For they bear part of the responsibility for the misery inflicted on citizens by the earlier derailment. Those who have chastised the government for its failure to massively invest in vaccine production early on must answer whether they themselves had offered such advice even as late as January 2021 when the government approved the first two vaccines for emergency use

The writer is professor, Columbia University, US

 
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