Patralekha Chatterjee focuses on development issues in India and emerging economies. She can be reached at patralekha.chatterjee@gmail.com

As Modi govt turns 3, let’s talk about jobs

Published May 20, 2017, 1:48 am IST
Updated May 20, 2017, 1:48 am IST
The moot point is that in just about three years, India will have the world’s largest young workforce.
Prime Minister Narendra Modi (Photo: PTI)
 Prime Minister Narendra Modi (Photo: PTI)

Most people in India appear happy with the Narendra Modi government as it enters the final stretch of its five-year term. That is the verdict of opinion polls. If you are a hardened cynic and refuse to buy that, you still have to deal with the BJP’s string of electoral successes in recent Assembly elections, including the landslide win in Uttar Pradesh. The party leadership is jubilant at how things have turned out since the BJP-led National Democratic Alliance came to power at the Centre three years ago. Expectedly, Mr Modi’s critics see things differently. They point to emboldened, hardline Hindutva moving from the margins to the mainstream, divisiveness, rising violence in the name of cow protection and so on in the past three years.

None of this cuts any ice with Mr Modi’s supporters. In 2014, the polls were about Mr Modi; in 2017, the celebrations are about him and the 2019 general election  will also be about him, probably in a pronouncedly pro-poor avatar.

As the season of Modifests kick off on May 26 in some 125 locales across India, it is safe to predict verbal jousts between Mr Modi’s supporters and detractors. That has been the story so far. But amid the wordy battles, it’s equally clear both sides agree on one thing. Whichever way you choose to look at the country, jobs — or the lack of them — are among the biggest concerns today.

“The giant sucking sound you heard was the sudden disappearance of a large chunk of jobs in India’s most sought-after sector — software services,” noted a recent article in Swarajya, a website which has been broadly supportive of Mr Modi, and which calls itself a big tent for liberal right-of-centre discourse on politics, economics, business and culture.

The article points out that whether it’s Infosys, Tata Consultancy Services, Cognizant, Tech Mahindra or Capgemini, thanks to weakening demand in North America, increased automation of lower-skilled jobs and pressure for more local recruitment, pink slips are being handed down and future hiring plans pared in India.

Disappearing jobs in the infotech sector is only one part of the story. Over 60 per cent of the eight lakh engineers graduating from technical institutions across the country annually remain unemployed, according to the All India Council for Technical Education. There is more: in 2016-17, only 2.13 lakh jobs were created in eight key sectors — manufacturing, construction, trade, transport, accommodation and restaurants, IT/BPO (business process outsourcing), education and health.

Joblessness is not a new concern in India. Jobless growth started before the dawn of Mr Modi’s New India. But the BJP made job-creation a key element of its development narrative. In its 2014 manifesto, the BJP chastised the Congress-led UPA government for dragging the country through 10 years of “jobless growth” and promised economic revival, high priority to job creation and opportunities for entrepreneurship.

In recent days, Mr Modi’s ministers have been talking a lot about all-round improvements in the past three years —infrastructure building, reining in corruption, the host of changes in policy and practice, of programmes like “Make in India”, “Jan Dhan Yojana”, etc. But on job creation, there is little discussion.Understand-bly so, because it is not a pretty story.

The India Exclusion Report 2016, brought out by the New Delhi-based Centre for Equity Studies, reminds us that Mr Modi’s most powerful election promise in 2014 for millions of young voters was to create 10 million jobs. With 65 per cent of India below 35, this promise undoubtedly drew millions of young people who legitimately dream of a better life, it says. A million new young people join the workforce every month. Yet more than halfway through the Modi government’s term, the report notes, “job creation has fallen to levels even below those the preceding UPA governments plunged to”.

Alarm bells started ringing quite a while ago. One report in April 2016 noted textiles, leather, metals, automobiles, gems and jewellery, transport, information technology and handloom sectors together created only 135,000 jobs in 2015. This was 67 per cent lower than the 421,000 jobs added in 2014, the UPA government’s last year.

To be fair, the Modi government is not at fault for the global whirlwinds are accelerating the jobless growth trend. Union ministers and the BJP’s communications cell have been busy noting that there was a new “paradigm in employment generation”, that this government wants to make India a nation of job creators than job seekers, and some 7.75 crore Mudra (micro units development and refinance agency bank) loans have been sanctioned to encourage small entrepreneurs.

Which is all very well. But we don’t know as yet how successful these businesses will be in the long run, how many of them will survive and whether some of these entrepreneurs will be eventually pushed into low-end self-employment or casualised wage employment.

Everyone knows India’s primarily young electorate is ambitious and impatient. Mr Modi kindled their hopes and aspirations. But precisely for that reason, the prospect of jobless growth, and threats from protectionist tendencies globally and increasing automation are such daunting challenges for a leader cast in the “pro-poor” mould.

The jobs story is further complicated as India has never had reliable jobs data. The official employment numbers don’t capture all economic activities, and are often not up to date.

Hearteningly, the government recognises the problem and has taken the first step by forming a task force headed by Niti Aayog vice-chairman Arvind Panagariya. Its mandate is to suggest ways to capture reliable and timely job data and possible solutions to promote job creation.

It’s yet to be seen how the suggestions will be implemented and what the new jobs data will look like.

The moot point is that in just about three years, India will have the world’s largest young workforce. In the days ahead, we sorely need an honest conversation about the jobs scenario — what is possible, what is wishful thinking, the pitfalls and the promising signs. Why not start the process during the Modifests?


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