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JUNE 4, 2006
 Cover Story
 Editorial
 Features
 Trends
 Bookend
 Money
 BT Special
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Insurance: The Challenge
India is poised to experience major changes in its insurance markets as insurers operate in an increasingly liberalised environment. It means new products, better packaging and improved customer service. Also, public sector companies are expected to maintain their dominant positions in the foreseeable future. A look at the changing scenario.


Trading With
Uncle Sam

The United States is India's largest trading partner. India accounts for just one per cent of us trade. It is believed that India and the United States will double bilateral trade in three years by reducing trade and investment barriers and expand cooperation in agriculture. An analysis of the trading pattern and what lies ahead.
More Net Specials
Business Today,  May 21, 2006
 
 
HEALTH
The Real Cost of AIDS
Already, a staggering 5.2 million people in India are infected with HIV, and if unchecked, the killer bug could push 4.3 million people deeper into poverty and shave billions of dollars off India's GDP. Can India defeat this epidemic-in-the-making?
Low hope: Of the 5.2 million HIV infected people in India, just 30,000 are receiving treatment

When he was 20, Elango Ramachander wanted to be a photographer. But fate willed otherwise. A reckless lifestyle ensured that he acquired a brand new bug that few had heard of back in 1988. He became one of the first few Indians to get infected with HIV (Human Immunodeficiency Virus), which causes AIDS, or Acquired Immunodeficiency Syndrome. Ramachander recounts the horror that followed: "The doctor gave me just four years to live. I stopped working. For five to six years I lived in darkness. I would go to the library, go through the newspapers to get scraps of information." Thanks to strong genes, and-of late-anti-HIV drugs, Ramachander is still alive and married to another HIV positive woman. He never became a photographer, but found his calling as an advocacy and policy officer with the Indian Network of Positive People (INP+), a Chennai-based NGO, run for and by HIV positive people.

Between 1988 and now, millions more in India have met with Ramachander's fate. Since 1986, when the first HIV case was detected among sex workers in Chennai, the estimated number of HIV positive people in the country has soared to 5.20 million, which is 0.91 per cent of the total adult population. If unchecked, the situation could soon reach epidemic proportions. (Technically, a country is said to be facing a generalised AIDS epidemic when at least 1 per cent of the adult population is HIV positive.) Says Ashok Alexander, who heads Avahan, the anti-AIDS initiative of the Bill & Melinda Gates Foundation in the country: "India is where South Africa and Thailand were in the early 90s. We are reaching an inflexion point."

But a health crisis isn't the only fallout of this growing menace. The roaring Indian economy could suffer a severe setback if the problem snowballs. Shockingly enough, there are no reliable estimates available yet on the economic impact of HIV. Delhi-based economic think tank NCAER (National Council of Applied Economic Research) is currently doing a comprehensive study for UNDP (United Nations Development Programme), but its findings won't be available until June 27 this year. However, even an amateurish, back-of-the-envelope calculation throws up just what is at risk: Given India's per capita income of $700 (Rs 31,500) and an HIV positive headcount of 5.2 million, at least $3.6 billion, or Rs 16,200 crore, of productivity is under threat. Translate that into PPP (purchasing power parity) equivalent, the figure soars to $18 billion, or Rs 81,000 crore.

"It is not a disease only of the poor. Evidence suggests the middle class and upwardly mobile young people are equally vulnerable"
K. Sujatha Rao
NACO

As the epidemic makes inroads into the heartland of India (see The HIV Snapshot), it is clear that the socio-economic consequences will be devastating. According to a UNAIDS (the Joint United Nations Programme on HIV/AIDS) forecast, if AIDS continues with its relentless march across districts in the country, it will be impossible for the government to deliver on its Millennium Development Goal of reducing the population of people below the poverty line to 15 per cent by 2015. The anti-AIDS organisation estimates that roughly 4.3 million people will be pushed deeper into poverty because of the epidemic.

For the affected families, the consequence can be traumatic and ruinous. Since HIV is more prevalent among sexually active people in the age group of 14 to 49, it not only immediately hits the family income, but also increases costs in terms of treatment and better diet. Revealingly, an International Labour Organization (ILO) study done in 2002 pointed out that such families start spending more on food and medical treatment, and less on education. In fact, in some African nations, AIDS has also been linked to an increase in child labour. That shouldn't be too hard to explain. If the parents get infected, then the family has no choice, but to take its children out of school and put them in factories or farms.

Shocking Indifference

At present, corporate India doesn't seem too worried about the problem, and that's a big mistake. A study, also done by ILO in Andhra Pradesh in 2003, at a coal company revealed how costs can shoot up due to medical care bills and lost productivity. "In the five years previous to the study," says S. Mohammad Afsar of ILO, "29 employees were declared unfit to work due to AIDS, and the company had to pay Rs 65 lakh in compensation, which they could have saved if the employees had been provided treatment." Obviously, the company in question-like many others even today-did not have a proactive HIV policy (see Corporate India & AIDS), and it today has 311 HIV positive employees on its rolls and may have to pay as much as Rs 9 crore in compensation in the years to come.

"The doctor gave me just four years to live. I stopped working. For five to six years I lived in darkness"
Elango Ramachander
Indian Network of Positive People

However, if the coal company decides to put them on antiretroviral (ARV) drugs, the cost involved would be significantly lower at Rs 5.50 crore. "Industry does not believe that there will be a significant impact either by way of losing competence or opportunities for growth," says Dr Denis Broun, Country Co-ordinator for UNAIDS. Worryingly enough, even the trucking industry-whose drivers are one of the key high risk groups-does not see the epidemic as a big problem. "The general impression is that, 'Yes, there will be a cost, but it will be a small cost'," says Broun.

The most direct and visible cost of the epidemic is the government spending on it. This year, Rs 900 crore has been allocated to the National AIDS Control Organisation (NACO). Never mind that the budget is far short of the estimated $1 billion (Rs 4,500 crore) that is needed for prevention and treatment of HIV, this is money the government could otherwise have spent on education, infrastructure or healthcare.

One reason why the HIV issue hasn't received the kind of attention and urgency it deserves has to do with the profile of its typical targets. In India, 86 per cent of the HIV transmission is through the heterosexual route. Commercial sex workers, truck drivers and migrant labourers-all of whom come from rural areas to the big cities in search of a livelihood-constitute the high-risk group for HIV transmission. In fact, 57 per cent of the infected adults have a rural background. Men, of course, constitute a larger share of the infected pool, but there's growing evidence that a "feminisation" of the epidemic is happening. As of now, 38 per cent of the affected population is accounted for by women. "But it is not a disease only of the poor," cautions K. Sujatha Rao, Additional Secretary and Director General, NACO. "There is enough data around to suggest that the middle class and the upwardly mobile young people are equally vulnerable," she says.

CORPORATE INDIA & AIDS
Recently, the Indian Business Trust (IBT) for HIV/AIDS-an umbrella body for industry's response to AIDS-came out with an overarching policy to deal with the issue. The cornerstones of this policy include education of employees and their families, care and support for the affected employees, and non-discrimination. It also promises no pre-employment testing. This document has been signed by more than 500 organisations in the country. That, by no measure, is a large enough number, but even among them only a handful of companies such as Gujarat Ambuja, L&T, SAIL and Delhi Metro Rail Corporation have any serious policy for the workplace. The others argue that the absence of an HIV policy does not mean indifference. "ACC doesn't have a policy in place, yet it intends to set up and run an ART (read: treatment) centre in Gulbarga, Karnataka, at a cost of Rs 1 crore," says Shefali Chaturvedi of IBT. Still, why aren't more corporates worried about the HIV problem? There could be two reasons for it. One is that many of them don't see their white-collar employees under threat from the disease. The other is that, unlike in the UK or the US, insurance companies in India do not offer insurance to HIV positive people. While insurers blame the lack of reliable information on the affected populace for not offering cover, the bigger reason could be a lack of pressure from industry. That'll come with awareness, when people realise just how devastating AIDS could be to their companies and societies.

Defeating A Scourge

Why is tackling HIV, even getting an accurate count, proving to be so difficult? There are several reasons behind it, but the principal two have to do with money and the social stigma attached to it. NACO, which is the nodal organisation for formulation and implementation of AIDS control policies, arrives at its estimates through a random sampling of cases from 750 sentinel surveillance sites set up in districts with high HIV prevalence. Each site contributes 400 samples, which are then tested and verified. The results are extrapolated to the denominator of a billion people, and that's how the figure of 5.2 million is obtained.

Here's the problem: Even this estimate is driven down by the supposed lower prevalence of HIV in North India (that, in turn, means NACO has fewer surveillance sites here for sample collection and tests). Therefore, critics argue, the national prevalence rate of 0.91 per cent does not reflect reality. Indeed, in several districts of Tamil Nadu and Andhra Pradesh, the prevalence rate is between 3 per cent and 4 per cent. The other HIV hotspots are Karnataka, Maharashtra, Manipur and Nagaland. Says Broun of UNAIDS: "India is really a continent, and we do not have a single epidemic. The epidemic that is driven by injecting drug users in the North-East does not have the same pattern as the one that is sexually-driven in the South."

And if curbing the spread of HIV hasn't been easy, it's due to the stigma attached to it. According to the 2002 ILO study, 70 per cent of the affected people experience discrimination and ostracism. Often, the worst culprits are the victim's own family members. "This is what makes HIV/AIDS different from other illnesses as the family is the first point of support," says ILO's Afsar. The absence of clear and correct information aggravates the situation, and according to K.K. Abraham, President of INP+, the information gap is partly due to the unreasonable skew towards prevention in NACO's AIDS programme. A fact with which Yusuf K. Hamied, Chairman of Cipla, which supplies low-cost ARVs to 400,000 people worldwide, agrees. "HIV can be treated as a chronic ailment. It need not be a death sentence," he says. But others like World Bank's Lead Health Specialist Cornelis P. Kostermans say that prevention has to be "priority one, two and three for India".

"We are reaching an inflexion point. The next five to 10 years are significant. One can think of it as a window of opportunity"
Ashok Alexander
Avahan (Bill & Melinda Gates Foundation)

The government started with a free first line of treatment through ARV drugs for HIV as late as 2004. Second line drugs are still not available, and people like Abraham allege that there is a shortage of drugs. Even now only around 30,000 patients are being treated-that's a minuscule 0.5 per cent of the affected population. "The government should make some statements about its overall treatment plan," says Hamied, adding that concerted efforts should be made to increase diagnosis through free tests and treatment. (For the record, not all HIV positive people need to be treated; the t-cell count, a measure of immune system, must drop below 350 to necessitate treatment, which gets costlier as the disease progresses.) Rao believes that the recent increase in NACO's budget will help. "We have just got the funds and we will start looking at deployment of these funds," she says. For starters, the North will get an additional 400 sites, raising the all-India count to 1,150.

Meanwhile, there's a flicker of hope emanating from Tamil Nadu. Sustained and targeted intervention in the state has yielded a minor improvement. According to an Indo-Canadian study published recently in the medical journal Lancet, the prevalence of HIV among the 15- to 24-year-olds has dropped by over a third in the southern districts. Says Alexander of Gates Foundation: "The next five to 10 years are very significant. One can really think of it as a window of opportunity." India has to act decisively and concertedly in that time. Otherwise the happy India story could turn tragic.

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