09 MAR,2020 | MEDC
A networked world faces networked risks. This fact has been painfully brought out by the global Covid-19 outbreak. Today, countries also need to think about risk just as companies and individuals do. The key issue in thinking about risks at the national level, is that wrong calls can impose huge societal costs. For example, protectionism cannot be a logical answer to dealing with global supply chain disruptions. The potential of Covid-19 to dislocate global supply chains, combined with the unpreparedness of policymakers, raises important questions of national concern. In any public risk-management system, there will always be a trade-off between economic efficiency and economic security. Where the dividing line needs to be drawn in various situations, is a choice that needs to be made by the elected government. In this context, India probably needs to set up a national risk office, one that can take the difficult decisions on the basis of a thorough cost-benefit analysis. This is an idea meriting serious thought.
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