Modi government backtracks on payments to families of Covid victims

Narendra Modi's government will not be able to pay the Rs 400,000 (£3,892) it promised to the families of those who died of Covid as the country's finances are "under severe strain".

In an affidavit filed before the supreme court, the Ministry of Home Affairs said it had taken several measures for "substantial and speedy" relief for every citizen but claimed it could not afford to meet financial payments which prime minister Modi's government had first mooted back in March.

“The prayer of the petitioner for payment of ex-gratia to all deceased persons due to Covid-19 is beyond the fiscal affordability of the state governments," the affidavit stated.

“Already the finances of state governments and the central government are under severe strain due to the reduction in tax revenues and increase in health expenses on account of the pandemic. Thus, utilisation of scarce resources for giving ex-gratia may have unfortunate consequences of affecting the pandemic response and health expenditure in other aspects and hence cause more damage than good.

“It is an unfortunate but important fact that the resources of the governments have limits and any additional burden through ex-gratia will reduce the funds available for other health and welfare schemes.”

On June 11, the central government had told the supreme court that seeking directions for ex-gratia compensation of Rs 400,000 (£3,892) to the families of those who died of the deadly virus are “genuine” and under consideration.

Last month, the supreme court sought the Modi government’s response on two petitions seeking ex-gratia compensation and said there should be a uniform policy for issuing death certificates to those who died.

It also asked the government to place before it the ICMR (Indian Council of Medical Research) guidelines on death certificates for Covid victims.

The government has now told the court that it would be incorrect to say that the help can be provided only by means of ex-gratia assistance as “it would be a rather pedantic and narrow approach”.

It said a “broader” approach involving health interventions, social protection and economic recovery for the affected communities would be a “more prudent, responsible and sustainable approach”.

Governments in other countries also followed a similar approach and announced interventions that gave fiscal stimulus, the ministry said, adding that the government of India also has taken the same path.