Black Economy of Modi Government’s Vaccine Policy

The Modi government’s handling of the Covid-19 epidemic is a continuing disaster for India. Its acts of commission (the lockdown last year) and omission (zero preparation to face the second wave this year) are attributable to its arrogance and incompetence. However, the new vaccination policy announced on 21 April, which puts half of the country’s production in the open market at prices set by manufacturers, falls in a different category. Like the three agricultural laws passed last year, this policy is a systemic response to an opportunity. Hence, the reasons behind it do not all lie in the subjective character of the leadership but the inner workings of India’s policy framework and economic system.

A notable feature of systemic practices is they correspond with ideological forms that help reproduce those very practices by providing them metaphysical significance and moral value. Think of entire cultures and ‘civilisations’ spawned by systems of social life such as casteism, racism and patriarchy. The purpose of such ideological forms is to mould human subjectivity to make people effective practitioners within the system. Critical reflection on systemic practices and exploring their moral underpinnings typically results from two sources: from internal contradictions, when some people living inside the system resolve, enough is enough, and from encounters with alternate systems of social practices.

The past three decades in India have seen a fundamental shift in the moral economy of capitalism. From a semi-feudal, semi-bureaucratic and populist socialist moral economy of the Nehruvian era, the country has been ushered into the neo-liberal era. The morality of the license-permit raj, that gave the state the authority to separate ‘white’ economic activities from ‘black’ and put a veil of petty criminality upon many transactions, has been replaced by the seeming amorality of the market. As Marx explains in the first chapter of Capital, commodity fetishism is the ideological form generated by market transactions. People under its spell notice only the phenomenal form of market transactions as non-coerced free exchanges and fail to pay attention to the underlying social relations of unequal dependences, power play, and subterfuge.

Now, when the neoliberal moral economy makes all of us instinctively believe in the fairness of the market, it is instructive to compare the systemic basis and ideological forms of the Modi government’s vaccination policy with certain economic practices of the Nehruvian era.

Black Marketing at Cinema Gates

Cinema has been the entertainer of Indian masses for more than a century. In diverse contexts, it also ushered in quotidian practices that people learnt to take in their stride. One such practice was the sale and purchase of theatre tickets in ‘black’. The practise was fairly common outside theatres in city centres, particularly for popular films for which the box office would often carry the “House Full” sign. It worked like this: As viewers approached theatres, seemingly aimless men would walk past speaking in hushed tones quoting their asking price for a ticket. Cinema-goers had two options, either join the ticketing queue with no guarantee that they would get any tickets or buy them at the inflated price demanded by the black marketer. The system automatically divided viewers into two categories. Those willing to pay extra for a guaranteed ticket without the hassle of standing in a queue, and all others who would trudge along.

Black marketing of cinema tickets was considered illegal by the state. Yet, in popular culture, these men occupied a liminal position. The very adjective, black, meant that they did not enjoy public approval. Yet, they would not be considered villains. In fact, in films such as Dev Anand’s 1960 Kala Bazar, the male lead starts with this activity and is presented as an endearing ruffian. Their work did not involve overt violence or threat of violence. They did exploit people’s needs, but it was for entertainment, not essentials of life such as food, for which the village money-lender would forever remain a villain in popular culture.

The black marketing of cinema tickets worked through a system. The first step was scarcity. This was helped by the popularity of cinema, but the point was to amplify the perception of scarcity and to sustain it. The collusion of cinema hall owners and functionaries, either voluntary or coerced, was essential. The second requirement was monopoly control over the point of sale. It would not work if ten persons were trying to sell tickets independently and undercutting each other. The young men selling tickets were small fry. The actual levers of the trade were controlled by crime syndicates. And then there was the state. The activity was formally illegal, but that only meant that it became a lucrative source of underhand earnings for the police and through it for other state functionaries. The public performance of petty criminality, hushed tones of young men selling tickets, and the occasional appearance of a beat constable waving his stick, were an essential veil over a system of deals between crime syndicates, cinema hall owners and state functionaries.

Sixty years later, in the era of multiplexes and digital cinema at home, the black marketing of cinema tickets is just one chapter in the social history of Indian cinema. Yet, the three activities that made up the system of selling these tickets—engineered scarcity, market monopoly, and collusion between capital and state—still animate profit-making in India. The Modi government’s vaccination policy is a prime example.

Designed to Deliver Super-Profits, not Vaccines

Given the technical requirements of making a vaccine against the coronavirus, the number of vaccine manufacturers is limited everywhere. This would have ensured monopoly control of manufacturers over any vaccine market, but for the fact that no country has allowed such a market to emerge.

Everywhere, the national government is the sole buyer of vaccines. Prices have been set through one-on-one negotiations and agreements signed with pre-decided tight delivery schedules and stringent penalty clauses. Governments are focused on the pace and universalisation of vaccination, as these are prime requirements to control the epidemic. Yet, the Modi government’s actions have had little place for epidemiological concerns. It made practically no binding agreement to supply vaccines in policy-determined quantities. It placed a measly order of 11 million doses with SII as late as in January, then for 120 million doses in March, just as the second wave was rising. And now, when no extra production capacity exists and the second wave is on, rather than scramble to increase production by de-licensing and letting the seven state-owned vaccine-making enterprises fill the gap, it has gone for the open market in vaccines. The policy is tailormade to maintain monopoly pricing under conditions of scarcity. Even Covaxin, which has been co-developed by Indian state-controlled ICMR, has a single producer.

The third leg of the system, the collusion between private capital and state functionaries, is now direct. There is no need for underhand deals as the policy itself is designed to serve profit-making. By giving the two existing domestic manufacturers rights to set their price for the so-called open market without any negotiations, the government has assured them super-profits. It is not an accident that the open market prices of the vaccine in India are the highest in the world. As the price of cinema tickets bought in black, the open market price of the vaccine is its black market price. The vaccination policy of the Modi regime has divided Indians into two groups; those ready to spend money to get a shot in plush corporate hospitals and others who must await their turn in crowded state facilities.

A Shameful Denouement

The policy is scripted, but some Opposition-ruled state governments and sections of the media are refusing to play ball. Now, even the courts, which enjoy the constitutional authority to arrogate any matter of public interest to themselves, have jumped into the fray. In trying to defend the indefensible, the Modi regime is tying itself up in knots and appearing too clever for its own good. Modi government policy promises super-profits but unless the smog around it clears, it is just a promise.

Sensing a possible derailment from the script, one of the vaccine-makers has left the country for a foreign land where, according to a news report, he is paying about Rs. 2 crores per month as rent for a mansion. He has announced from there that there was just too much pressure on him in India. A few weeks ago, he asked for Rs. 3,000 crores from the government to ramp up production to meet the growing demand for his vaccine in India. This the Modi government released in earnest. The fellow, however, has announced a similar investment of his own (about Rs. 2,400 crores) in the foreign land, even when the vaccine programme in India is floundering. Think of it! Sensing his importance to the vaccination programme in the country, the government had provided him Y level state security with commandos and cops. But good capitalist that he is, he prefers better returns on his investment in another country. That other country happens to be one of the centres of global finance, whose good graces even the Indian government seeks.

Pushing the analogy with the black marketing of cinema tickets further, it is like an area police head believing that with the proper use of carrot and stick, he will get the local don to deliver. But it turns out that the latter has direct access to the city commissioner. The poor SHO cannot do a thing even if the don mocks him from the commissioner’s lap. One can get angry or make fun of the cat and mouse game between the SHO and the don. But unlike a cinema ticket, vaccination is a matter of life and death for Indians. Unless enough vaccines, at an affordable price, are made available at the earliest, thousands are going to perish.

The designs behind the Modi government’s new vaccine policy are obvious, but it is due to the neoliberal moral economy, the ideological prop of current capitalism that all political parties share, the media, and influential Indians, that the economic logic of this policy which assures capital super-profits from a health disaster has escaped public scrutiny. Criticism has centred on the effects of the policy on state government finances and vaccination schedules rather than the system of economic practices that make it what it is.

The Nehruvian moral economy was a farce but still gave people the adjective of ‘black economy’ to show their moral disapproval of certain economic practices. Neoliberal subjects do not even have a name to tag nefarious forms of profit-making encouraged by state policy. Repeat phenomenon in history is said to come first come as tragedy, then as farce. In India, the very first instalment of capitalism after independence was a farce. Its second arrival is beyond farce. The emperor does not even pretend that he is wearing clothes.

Sanjay Kumar teaches Physics at St Stephen’s College, Delhi. The views are personal.