It never made sense to decentralise vaccine procurement and distribution. Given the uneven nature of the pandemic’s intensity across the land, it makes sense to have intensive vaccination in areas around pandemic clusters, rather than have vaccination thinly spread out across states in the name of equity. The idea is to use vaccination as a tool to check the pandemic, and save as many lives of citizens as possible, not to treat vaccination on par with devolved financial resources, to which every citizen has more or less equal claim. Giving priority in vaccination to population groups that would insulate as yet uninfected people from infected clusters cannot be done effectively when vaccine procurement is decentralised. It is welcome, further, that the Centre would foot the bill for procuring the vaccines, and give the vaccines for free to the states. However, the Centre should discontinue to its current practice of buying vaccines at rock-bottom prices that leaves the vaccine makers with insufficient margins to expand capacity. That strategy is valid if, and only if, the government were to undertake the at-risk investment of setting up vaccine capacity and developing vaccines. The government should clarify the pricing policy for the quarter of the vaccine output that is outside the ambit of procurement. Would vaccine producers be free to price them as they like?
The lower the procurement price, the greater the pressure on vaccine makers to raise the price of doses sold to hospitals, to get a decent average realised price. Further, what is the forward visibility on producers being allowed to meet their export commitments?