As expected, the international community is mobilizing to assist India, where COVID cases have spiraled out of control, threatening to derail not just the domestic economy, but the global recovery more generally.
Reports of widespread undercounting suggest the death toll from the country’s new wave may be orders of magnitude higher than official tallies.
An acute oxygen shortage means people are dying who otherwise may have survived, and there are mounting concerns that the variant spreading in India could present a new challenge for scientists desperately trying to stay ahead of the virus.
Read more: India Needs Help. Now
US National Security Adviser Jake Sullivan spoke to his counterpart in India over the weekend. The US will provide vaccine materials and additional financial assistance. The European powers are likewise poised to deliver aid.
On Sunday, India logged almost 350,000 new cases and more than 2,750 deaths. Modi’s express desire to avoid a strict national lockdown seems increasingly untenable.
Speaking of untenable, growth estimates for India made prior to the current surge may soon be out of reach, even as forecasters aren’t yet ready to throw in the towel. The IMF’s latest World Economic Outlook put growth at more than 12% this year, the most among major economies (figure below).
Janez Lenarcic, the European Commissioner for Crisis Management, tweeted Sunday that the EU has activated the Civil Protection Mechanism. Europe “is already coordinating and is seeking to send oxygen and medicine to India after receiving a request from Delhi,” he said.
Ursula von der Leyen called the situation “alarming” and said the EU “is pooling resources to respond rapidly to India’s request for assistance.”
“Just as India sent assistance to the United States as our hospitals were strained early in the pandemic, the US is determined to help India in its time of need,” the White House wrote, in a statement, adding that,
To this end, the US is working around the clock to deploy available resources and supplies. The US has identified sources of specific raw material urgently required for Indian manufacture of the Covishield vaccine that will immediately be made available for India. To help treat COVID-19 patients and protect front-line health workers in India, the US has identified supplies of therapeutics, rapid diagnostic test kits, ventilators, and Personal Protective Equipment that will immediately be made available for India. The US also is pursuing options to provide oxygen generation and related supplies on an urgent basis.
In case the message isn’t clear enough: This is rapidly becoming an international emergency. And it if isn’t dealt with accordingly, it could become an international crisis. At that point, markets would find it exceedingly difficult to ignore.
Also on Sunday, Anthony Fauci told ABC that sending India unapproved doses of the Astra vaccine from America’s stockpile is on the table. “We have about 30 million doses of that AstraZeneca vaccine that aren’t approved for use here. Shouldn’t we just be sending that over?,” George Stephanopoulos wondered. “I think that’s going to be something that’s up for active consideration, George, certainly,” Fauci responded.
Meanwhile, Japan’s latest state of emergency is now in effect. It covers Tokyo, Osaka, Kyoto and Hyogo, and will last for 17 days. “The scheduled end, ahead of an expected visit to Japan of International Olympic Committee President Thomas Bach in mid-May, has led to criticism that the government is putting the Olympic schedule over people’s health,” the AP noted. Japanese shares are coming off their worst week since February despite the BoJ returning to the market. The central bank meets this week.
Oh, and if you were wondering whether Senate Republicans are more concerned about the deficit or staying in the good graces of corporate America at a time when the C-Suite is increasingly inclined to distance itself from the party, Lindsey Graham told Fox that in his view, “there’s a deal to be done on infrastructure” and all of the cost needn’t be funded, especially not if funding it means raising corporate taxes.
Instead of raising the corporate tax rate, Graham said it might be preferable to spend between $800 billion and $900 billion and “not pay for it.”
What’s that you say? Unfunded spending? And Lindsey Graham is suggesting it? On Fox?
“I’m not going to raise corporate taxes to 28%. At the end of the day, I’m willing to not pay for some of the infrastructure spending because I think it pays for itself over time,” he explained, adding that Americans should “watch Joe Manchin.”
If India reaches 1/2 million new cases a day (and they already be there), i doubt that any amount of aid will quell the pandemic, especially if they refuse to implement even the basic health measures available to them now. Those who can isolate at home, who have the necessities of life stored away, may survive until they run out, but what then? There are certainly untold millions who need to go into the streets every day if they are to eat. And those who have the means to escape will certainly try. It is what we would do ourselves.
“Speaking of untenable, growth estimates for India made prior to the current surge may soon be out of reach, even as forecasters aren’t yet ready to throw in the towel. The IMF’s latest World Economic Outlook put growth at more than 12% this year, the most among major economies (figure below).”
Indeed. It’s completely deluded to think growth won’t be adversely impact by this, yet economists overall seem fairly sanguine about the whole situation.
Check out the price action on EPI, HDB and IBN this morning. Investors clearly see no reason to worry about the Indian economy. It’s beyond logical.
All three are higher again this morning!
Why do we all even bother discussing “herd immunity” or economic fundamentals?
But … speaking of herd immunity, there is a worrisome rise in the numbers of people not showing up for their second Pfizer or Moderna shots. Does this call into question the herd immunity this quarter narrative from the two Morgans?