As UP warns anti-CAA protesters of confiscating property, a look at the economic and social cost of violence from Delhi to Hong Kong

As large-scale protests rage across the country against the Citizenship Amendment Act , there have also been fervent discussions on the costs of violence during such agitations — whether in terms of people who died or were injured, or in terms of damage to public property. On 24 December, a plea was moved in the Delhi High Court seeking directions to the authorities to recover damages for the destruction of public and private property during the anti-Citizenship Amendment Act (CAA) protests from those responsible. In Uttar Pradesh, over 60 people have been “identified for violence” during last week’s protests in Rampur and Gorakhpur and have been slapped with notices, asking them to explain their position or pay for damage caused to public and private property. On the other hand, several people on social media ( see here, for example) have questioned why outrage is restricted to damage to public property, and does not extend to lives lost due to alleged police firing.

Costs of violence in India

According to an analysis by IndiaSpend, between 2008 and 2017, as many as 7,484 communal incidents have been reported, which amounts to two incidents every day. In these incidents, over 1,100 lost their lives. Such violence takes a huge toll, in terms of people who lose their lives, property damaged as well as reduced investment due to volatile social situations. While there is little quantifiable data on these aspects, there is evidence of the economic costs of social strife. [caption id=“attachment_7809921” align=“alignleft” width=“380”]  A police personnel walks past a charred vehicle allegedly torched by protesters during a rally against the Citizenship Amendment Act (CAA), in New Delhi. PTI[/caption] For instance, a report by Business Standard after the Muzaffarnagar riots of 2013 pointed to shuttered shops and disrupted credit lines and supply chains due to the violence. The report quoted PD Mittal, the president of the Chamber of Commerce and Industry, Uttar Pradesh as estimating that business was down by at least 30 percent compared to the previous year. “Even when we approach the administration for routine issues, the standard answer we get is (that) there are other pressing issues to be settled before industry’s concerns are addressed,” he was quoted as saying. Another pertinent example is cow-related violence, which has taken a toll on several economic activities, such as exports of buffalo beef and leather. A report in Human Rights Watch points out that after the BJP-led government came to power, the growth percentage of exports of buffalo beef declined sharply — from 35.93 percent in 2013-14 to 9.88 percent in 2014-15 and further down to -0.01 percent in 2015-16. Similarly, growth in leather exports declined from 18.36 percent in 2013-14 to 9.44 percent in 2014-15, and further down to -9.86 percent in 2015-16. In 2018, the Institute for Economics and Peace, a global think tank headquartered in Sydney, estimated the economic impact of violence in India to be nine percent of its Gross Domestic Product (GDP). India ranked 59th on the list, which had a total of 163 countries.

Global picture

The Institute for Economics and Peace, which has been cited above,  releases a yearly report titled “The Economic Value of Peace,” in which it estimates the economic impact of violence. It does so by using several variables including military expenditure, internal security expenditure, deaths due to conflict, interpersonal violence and incarceration. According it, the impact of violence on the global economy was $14.76 trillion in 2017, which was equivalent to 12.4 per cent of world gross domestic product. The report notes," Since 1960, the most peaceful countries have, on average, seen their per capita GDP grow by an annual rate of 2.8 percent. Per person GDP was nearly three times larger in highly peaceful countries in 2016 than it was in 1960. However, less peaceful countries have experienced economic stagnation. Their annual per capita GDP has, on average, grown by just one percent over the last six decades." An illustration of this can be seen in Hong Kong, where protests, sometimes violent ones, have been going on since March. A Reuters report from August noted that the semi-autonomous Chinese city, a shopper’s paradise and gourmet destination for millions of tourists each year, is facing an existential as well as an economic crisis. The world’s biggest equity deal this year was to unfold in Hong Kong in August but was put on hold. Banks are issuing unprecedented profit warnings, while hotels and restaurants are half-empty. Several global events have been postponed and economists say retail sales could drop by 20 to 30 percent this year. Hong Kong is facing its first recession in a decade, with all its growth pillars under significant stress. For the whole year, the government expects growth at 0 to 1 percent, but some analysts expect it to shrink. In North Korea, it is perhaps an even more worrisome story. North Korea’s gross domestic product (GDP) contracted by 4.1 percent last year in real terms, the worst since 1997 and the second consecutive year of decline after a 3.5 percent fall in 2017, the South’s Bank of Korea estimated. North Korea’s international trade fell 48.4 percent in value in 2018 as toughened international sanctions cut exports by nearly 90 percent, the worst loss in exports since the central bank started publishing data nearly 30 years ago. Clearly, whether in India or in other parts of the world, violence extracts a huge cost, and needs to be taken into account by policymakers and analysts alike. With inputs from agencies