The Covid-19 crisis has exposed, not only the weaknesses of the health infrastructure but also the criminal disregard of the current regime to shield India from the tragic fallouts of the second wave. The rot is deeper and severe.
In terms of the public expenditure on health as a percentage of gross domestic product (GDP), India ranks among the lowest in the world. The average public expenditure on health among the lower-middle-income countries is 2.5% of their GDP, while in India it is a paltry 1%. Shamefully, the National Health Policy 2017 promises to increase the public expenditure on health to 2.5% only by 2025. Among the BRICS countries, Brazil spends 3.91%, Russia 3%, China 2.89%, and South Africa 4.36% of the GDP on public health expenditure. In South Asia, Bhutan tops the list with 2.55%, trailing India by a solid 1.55% margin.
The ultimate goal of a strong public health infrastructure is to ensure that no major disease outbreak occurs. And this is ensured through long-term planning. But this is simply not possible in a situation wherein private players become dominant as they are driven by the sole concern of profit.
The Indian government lacks proper vaccine manufacturing facilities—a tragedy that has been in the making for well over a decade now. Recently, the government announced a plan to include three public sector utilities (PSU’s) in the vaccine making process, Haffkine Biopharmaceuticals, Indian Immunologicals Ltd., and Bharat Immunologicals and Biologicals Ltd. Surprisingly, the state-of-the-art integrated vaccine complex-HLL Biotech Ltd., at Chengalpattu, Tamil Nadu, has not been given the permission to start vaccine manufacturing. The facility has been lying idle for around nine years now. In a response to the RTI filed by Anand Raj of Madurai, HLL Biotech has revealed that between 2013-2019, it has generated a revenue of Rs 6.77 crores and incurred a loss of Rs 96.25 crores!
Such criminal negligence by the government has led to a unilateral dependence on private companies for procurement. Catering to the Indian and the global market, Serum Institute of India’s annual revenues are at 59 billion rupees and it plans to become a 100 billion rupees company by 2022. The Government of India has been exceptionally warm to such private players. Some of the concessions given to indigenous manufacturing giants directly threatened public lives on a massive scale and were grossly unethical, to say the least. For instance, on 3 January, Covishield and Covaxin, manufactured by Serum Institute and Bharat Biotech respectively, received the ‘‘permission for restricted use in emergency situations subject to certain regulatory conditions’’. The Drugs Controller General of India (DCGI) gave the permission despite the absence of the crucial phase III trial Indian data. For Serum’s Covishield, phase III data from overseas studies were presented to claim efficacy in India and were accepted by the DCGI. But for Covaxin, the permission was then restricted for ‘use in clinical trial mode’. This allowed the Serum Institute to manufacture 50 million doses before obtaining the due permission.
First of all, the sheer helplessness of the government is due to the fact that it never mulled over entering vaccine production. And this of course has its roots in history wherein public health never seemed to be of ‘national interest’.
Secondly, the Serum Institute’s differential treatment by the Government of India raises concerns of crony capitalism. Few questions immediately emerge. Why is Serum Institute offering differential rates to the central and state governments? Are not the state governments part of India? Does not the first article of our Constitution read that “India that is Bharat, shall be a union of states? Perhaps the Poonawallas have either not read the Indian Constitution or have a callous disregard for it. They have announced Rs 400 per dose for states, Rs 600 for private hospitals, and Rs 150 for the Central government. Bharat Biotech has gone one step further and announced its rates per dose as Rs 600 for states and Rs 1,200 for private hospitals. The rates are biting the poor people of India in their face. What is leading to such high prices if not the lust for super-profits?
In the face of restricted supply, the government is filling the coffers of these monopolies. Both the companies are poised to get 4,500 crore rupees to bolster manufacturing from the Government of India. And after paying such a heavy amount, the government is again obliged to pay for the procurement costs, with states shelling out much more per dose. This is economically insensible. The need of the hour is to procure the vaccines and ramp up production, demand will be at the top since the vaccine is necessary for all--so the question of the forces of supply and demand setting the prices is out of the question. Exports of inputs might just halt the rate of manufacturing.
In this situation, when it is more than clear that government intervention is indispensable, nationalisation would be the best measure to stop the double flow of money i.e. as subsidies and procurement costs, into the coffers of big capital. Nationalisation would ensure that only the costs of production are met with public money. Most importantly, this would also ensure ‘one nation one rate’ for the vaccines because the government would have no reason to offer differential rates to states or private hospitals, simply because it would have no profit motive to fulfil.
Going a step further, the government could well give away the vaccines free of cost. The latter is the most sensible way to go ahead because ultimately it is the public money that the government would use to fund the manufacturing process. Few state governments have decided to provide free of cost vaccination. But here too the procurement costs would be paid out of the public exchequer. Since the Serum Institute has reserved 50% of its output for the central government, the states would have to ultimately purchase from the centre or buy the vaccines at a much higher price from the private players. In either case public money will be drained. This exorbitant and insensible fiscal loop could well be avoided if the central government takes over the production process and distributes vaccines as a matter of immediate public interest.
Nationalisation would also ensure the guarding of the number of vaccines exported to other countries. The government would be in a position to mark states on a priority basis depending on the spread and extent of the pandemic. In other words, geopolitical discrimination that is being rampantly practiced by the United States and European Union could well be averted. Black marketing of the vaccines, which has recently become rampant, could well be curbed by serious government intervention.
The biggest success story of nationalised vaccine manufacturing is that of Russia’s Sputnik V. Produced by the state-owned Gamaleya Research Institute, Sputnik V has shown efficacy of 92%. It has been allowed for use in over fifty countries. The nature of ownership has allowed for free-of-cost vaccination for all Russian citizens. Similarly, Cuba too has a solid public health infrastructure that was created in the face of a crippling economic sanctions imposed by an unrelenting United States. Although a bit late, the indigenous vaccines are currently in the phase III trials and are showing promising results. Instead of procuring available vaccines, Cuba is committed to developing its own vaccine so that it can facilitate its delivery to poorer and underdeveloped countries. Reports suggest that Cuba has already received orders to the tune of 100 million doses and the country is readying up for their production. Countries such as Iran that are hard-pressed to acquire vaccines from the international markets primarily because of the US sanctions are cooperating with Cuba to facilitate diversity in the phase III trials. Regardless is to mention that in Cuba, vaccination would be free of cost for its citizens.
A lot of unjustifiable things have been done in the name of nationalism and national interest by this government. And much of it has least benefitted the common Indian. This is one significant opportunity where nationalism could actually bode well for all of us. The government should waste no time in nationalising vaccine production. But the current regimes’ blind commitment to neo-liberalism and its selling spree of public assets raises a big question mark on its ability to nationalise in national interest. Therefore, it is the time for the nation—the people—to rise, hold the government to account, demand immediate nationalisation, so that the profit motive is nipped in the bud, but this time in true national interest!