covid vaccine

Chintan Patel and Vivek Kaul

India began administering covid vaccines on 16 January 2021. Within a week, the Indian government had sent almost 50 lakh free doses to Bangladesh, Bhutan, Nepal, Myanmar and other countries. The Modi government calculated that it could raise India’s global stature by pursuing a covid vaccine diplomacy strategy – dubbed vaccine maitry.

By the end of March, India had exported more vaccines than administered to its own population. In fact, India’s ambassador to the United Nations (UN) wore this fact as a badge of honour. In an UN general assembly meeting on March 26, Ambassador Nagaraj Naidu claimed: “In fact, as of today we have supplied more vaccines globally than have vaccinated our own people.” (The statement clearly hasn’t aged well).

Of course, as we know, India was hit by a massive second wave of covid in early April, which has caused widespread loss of life, health and wealth.

As India continues to grapple with the devastation, the government’s export strategy has come under scrutiny. Even the Serum Institute of India (SII), manufacturer of the Covishield vaccine, has been criticised for vaccine exports. Taking note of this criticism, SII came out with a statement defending the vaccine roll-out in India, including the rationale behind exporting vaccines before the second wave set in.

Let’s look at the underlying data to examine the public discourse on this issue, including some of Poonawalla’s claims. 

Source: Summary of a larger table available at https://www.mea.gov.in/vaccine-supply.htm.

The above table presents the data for the total covid vaccines exported – both by month, and by category. Vaccines sent abroad are divided into three categories: a) grants made by the Indian government, b) purchases made by the foreign governments (under commercial), and c) SII vaccines sent to COVAX – the international consortium that is coordinating the distribution of covid vaccines to low-income countries.

Central to the vaccine export debate, is this simple question: Did the government’s vaccine diplomacy effort contribute to India’s vaccine supply crisis?

The data presented in the above table provides some clues. Let’s look at them point wise.

1) A total of 1.07 crore vaccines were sent as donations to other countries. Of this, most of the vaccines were sent before April, when the second wave started. This category comes with nuance attached to it. The government of India purchased the covid vaccines from vaccine makers (almost exclusively from SII) and decided to send over 1 crore doses to other countries instead of making them available to Indian citizens.

Helping other countries who are also in need is a noble idea and can earn valuable diplomatic capital and goodwill. But it also comes at a cost. Clearly, the government thought that the benefits accrued by this act of benevolence outweighed the potential cost.

Making judgment calls on future events is an intrinsic part of leadership. Deciding to donate over one crore vaccines while most of the country was still not vaccinated was one such judgment call made by PM Narendra Modi and his government. The obvious alternate use of the vaccines that were given away to other countries – or what economists call ‘opportunity cost’ – was to inoculate Indian citizens.

Of course, one can always argue that one crore doses wouldn’t have made much of a difference in the overall scheme of things, given that India needs to vaccinate a total of 94.3 crore adults (people aged 18 and above). 

Nevertheless, the opportunity cost of the one crore vaccines was the increased immunity of many Indian citizens. Or as the old cliché goes, something is better than nothing.

Given both the severity of the infections and the lack of supply that has slowed down the vaccination drive since early May, there can be no doubt that the decision to give away vaccines wasn’t a great judgment call.

While one can argue (like Poonawalla does) that the intensity of the second wave of covid blindsided many, any government’s primary responsibility is to keep its citizens safe. If it fails to prepare for an event that leads to mass death and destruction, it has failed in discharging its primary duty.

As we had explained in a previous piece, the Indian government was caught napping, while other countries were stocking up on vaccine doses through the second half of 2020 and early 2021. (You can see the table here). The government got caught believing its own rhetoric. Using the surprise element of covid as an excuse would have worked at the point when the first wave struck. It doesn’t really hold when talking about the second wave. 

In many ways, the covid pandemic is a war-type scenario. Donating life-saving vaccines when our own population is still vulnerable is comparable to giving away body armour that could protect soldiers on a battlefield. That the enemy struck with more ferocity than expected, is not an acceptable excuse.

2) Nevertheless, there is much more to this story. A total of 3.58 crore doses were exported from January to March as part of purchase agreements between vaccine makers and foreign governments. The Serum Institute of India (SII) was the main player here, with Bharat Biotech (BB) having exported only 3.25 lakh doses abroad.

3) Another 1.99 crore doses were sent to the COVAX consortium by SII. COVAX is the global effort to procure vaccines for low-income countries led by Gavi, the Vaccine Alliance, Coalition for Epidemic Preparedness Innovations (CEPI) and the World Health Organization (WHO). Over 1.70 crore of these doses were sent in March alone. SII has contractual obligations to deliver vaccines to COVAX as part of its licensing agreement with Astra Zeneca and collaboration with Gavi.

Given that over 5.5 crore doses (3.58 crore plus 1.99 crore) sent abroad were a part of private contracts and licensing agreements between SII and foreign entities, can the Modi government really be held responsible for allowing the export of these vaccines? Supporters of the government will say no, while detractors will say yes. We, on the other hand, can only offer some nuance.

1) It is incorrect to group the vaccines which the government gave out as grants in the same category as the vaccines that were sent as part of commercial/COVAX agreements. The government is directly responsible for the former being sent abroad, and only tangentially responsible for the latter. Across all categories, vaccine manufactures (SII or BB) should not be targeted for exporting vaccines.

They were either selling to the Indian government, who then decided to share its stocks with the world, or fulfilling their contractual obligations – both perfectly reasonable and legitimate actions.

That said, in February and March, when the Covid situation seemed under control in India, the Modi government was happy to claim credit for all exported vaccines, including the ones being sent as part of private contracts. Hence, by their own logic, the administration should be held accountable for all 6.6 crore vaccines exported. But their logic was flawed when they claimed credit, and it would be flawed to pin equal responsibility to all export categories.

2) The 3.58 crore vaccines that foreign entities could buy from SII and BB was only made possible because the Indian government had not been proactive in placing vaccine orders. The government could have placed much larger advance orders, like other countries did. It could have done so especially with SII, to ensure that it got the lion’s share of the company’s production capacity, outside of its obligations to COVAX.

The government gave the first order for vaccines in January 2021 when it procured one crore shots from SII and 55 lakh shots from BB. After this initial order, the government has been ordering vaccines in a piece-meal manner.

An order of 12 crore doses (10 crore from SII and 2 crore from BB) was placed in March. The exact dates for other intermediate orders is not in the public domain, but around 16.5 crores doses were ordered before April 28. In early May, the government issued a statement clarifying that a new order of 16 crore doses (11 crore from SII and 5 crore from BB) was placed on April 28. The timing and quantity of these orders meant that vaccine makers were not given the fillip to prioritise maximum production with an assurance that their supplies will be purchased by the Indian government.

Prioritising your own citizens in a time of crisis is not selfish. In fact, it is the right thing for an elected government to do. The United States (US) which has the most robust vaccination drive in the world has been doing that, and justifiably so. The US chose not to export any of its vaccines, including ones that were not even authorised for domestic use till its vaccine supply exceeded local demand.  

3) Lastly, it is not entirely correct to claim that the government is in no position to interfere with vaccine manufacturers’ contract commitments to foreign countries or agencies. India has placed a restriction on vaccine exports since late March – so the provision exists to take such an action. Of course, placing such a restriction before the second wave hit, would have been difficult to justify.

These export restrictions bring up an interesting dilemma of vaccine exports vis a vis the role that the government has in the execution of private contracts. As mentioned earlier, SII has contractual obligations to other countries and COVAX to deliver a certain quantity of vaccines. In fact, SII may have already received advanced funding as part of those contracts. So, it seems only fair that the SII should be able to deliver on those contract terms.

However, SII needs export permission from the government to be able to ship vaccines out of the country. The government has temporarily halted all exports of covid vaccines given the domestic lack of supply and severity of need. In fact, last week it again denied SII’s request to export 50 lakh doses to the United Kingdom.

The situation in India may not improve in the months to come, and there is also the warning of a third wave that needs to be taken into account. A recent report suggests that this restriction may now last till October.  On the other hand, Gavi, the vaccine alliance, has made it clear that it views the agreement with SII as a legally binding contract that has to be enforced. Astra-Zeneca has also sent legal notices to SII for delay in shipments. The international community has bet heavily on India’s vaccine manufacturers and extended import restrictions may not be taken too kindly.

Given this backdrop, a potential international legal wrangle looms ahead. A vaccine initiative that promised friendship may end in acrimony.