Asha Devi can’t remember how many meals she skipped when she tried to feed a family of seven in a remote corner of northern India, where the novel coronavirus is exacerbating rural debt and poverty, etc. Old question.

The 35-year-old Devi had to use her land to mortgage a loan of 20,000 rupees (270 US dollars). After six months, as the money ran out, she stopped buying milk. The consumption of cooking oil was reduced by half, and she could only use it every 10 days. Buy lentils once.

As her construction worker husband is unemployed, she is facing deeper debts to make ends meet.

“Sometimes I go to bed hungry. Last week, I think I went to bed hungry at least twice, but I don’t remember,” Devi told Reuters, as she wiped it with a shabby saree outside a mud house in a village in Uttar Pradesh. Dry tears.

Devi said that Prime Minister Narendra Modi’s government has pledged to provide free food to the poor, but the rations are limited and insufficient to meet the needs of their families.

The coronavirus and last year’s blockade designed to stop it caused millions of people to lose their jobs in towns and were forced to return to their villages, as well as higher levels of debt.

Interviews with 75 households in eight villages in India’s most populous state show that household income has fallen by nearly 75% on average. Almost two-thirds of households are already in debt.

Devi’s husband used to work in the construction industry in the more prosperous Punjab state in the northwest, which allowed the family to make ends meet. Now that the job is gone, he returned home and tried to find a job.

Other unemployed people like him crowd around the brick kilns near the village every day, hoping to find jobs.

Economists say that heavy rural debt and low income will hinder any economic recovery the government is trying to achieve, and will also weaken private savings and investment for longer than expected.

“This will have a huge impact and prolong the recovery process. Both private consumption and investment will be hurt. It is good to find a way to put money in the hands of the people,” said NR, economist and vice president of the BR Ambedkar School of Economics in Bangalore. Bhanumurthy said.

In the fiscal year ended March 31, India’s gross domestic product (GDP) fell by a record 7.3%. The government predicted a 10.5% growth in 2021-22, but the second wave of pandemic weakened expectations, and several economists lowered their forecasts.

The poor are particularly hard hit.

The homeowner said that a Reuters survey showed that most of the 75 households in the Uttar Pradesh cluster (518 people in total) have already shouldered 6.12 million rupees ($82,250) in debt, of which more than 80% have not been repaid.

The survey found that since the March 2020 pandemic, borrowing has tripled, and about half of it has been withdrawn in the past six months.

With no work or support for a family, the cumulative monthly income of these 75 households has dropped from 815,000 rupees (10,960 US dollars) before the pandemic to approximately 220,000 rupees (2,960 US dollars).

“Almost everyone in this village is heavily in debt… Unemployment is the biggest problem,” said 55-year-old Komal Prasad, the former mayor of Gauriya, a small village in the cluster with a population of just over 2,000.

Villagers say that only about 30% of people in Goria have a job or are looking for a job, much less than before.

Juggi Lal, a 35-year-old farmer, said it was difficult for her to buy medicine for her disabled husband because she owed money lenders 60,000 rupees ($806) because of no work.

“I wake up every morning thinking about what job I will get and how will I spend the day?”

According to data from the Indian Economic Monitoring Center (CMIE) in Mumbai, the rural unemployment rate, which had hovered around 6% before the pandemic, rose to 8.75% in June.

Manorami Rawat, 35, extracts peppermint oil in a furnace in the village of Dalipur in northern Uttar Pradesh [File: Saurabh Sharma/Reuters]

The combination of falling incomes, rising debt and rising prices of staple foods is suppressing demand in rural areas where two-thirds of Indians live.

Suppliers said that sales of everything from biscuits, tea and lentils to auto parts have been hit. Some people have closed the shops that their families have run for generations.

43-year-old Gosh Mohammed (Gosh Mohammed) sold up to 8,000 rupees ($107) of groceries before the pandemic. Now it drops to 1,000 rupees ($13.5) per day.

He sold goods worth 60,000 rupees (800 US dollars) on credit from a wholesaler, but he couldn’t pay it off for six months.

“I’m never used to selling goods on credit, because buying with cash will give us more discounts,” Mohamed said.

“Now I think I will have to close my store because the wholesaler has stopped giving me credit, and I have sold the goods on credit, and the money is unlikely to come back.”