The rise in industrial production in May was positive, but low, and wholesale price index inflation at a negative -2.4 per cent, while encouraging, will get a boost with Prime Minister Narendra Modi’s August 15 announcement of new schemes under “Start-up India; Stand Up India”. It is hoped they will facilitate growth from the bottom upward. If every nationalised bank branch (there are 1.25 lakh across India) genuinely helps a tribal or dalit or a woman to become an entrepreneur, we would immediately have 1.25 lakh entrepreneurs employing at least four-five people.
This, with the Mudra (Micro Units Development and Refinance Agency) Bank and skill development incentives, may transform the economy. The National Skill Development Corporation also needs to change the way it functions. It is too top heavy, and Mr Modi should ask them to buck up or let someone else do it more innovatively. There is also a suggestion that the medium, small and micro sector entrepreneur can be incentivised to train one person each in some skill, enabling him/her to train others. This would lead to millions of skilled workers. There are around 30 million MSMEs, so just imagine the transformation if even half of them deliver.
One wonders why Mr Modi didn’t include private banks and NBFCs in his new schemes. Surely they too would like to help transform the economy. He could also ask various chambers of commerce to ask each member to set up one start-up for one unemployed person. They could all be incentivised, and this could lead to almost revolutionary change. And as a bonus, this would also challenge those politicians and all those spreading pessimism as the PM said in his I-Day speech.
The PM may have hit on the right remedy for the crores of India’s unemployed, who are usually left to their own fate.
He was right to say this would help more than subsidising the demand for capital. The usual employment generation expected from the big corporates or public sector units will never be able to generate the number of jobs needed to satisfy the estimated 10 million students who graduate every year, not to mention school dropouts and unskilled people. The answer that many people like professors at IIT Mumbai are now working on is helping people to become self-employed, self-reliant and creating entrepreneurs, and not waiting for handouts from the government. Unfortunately, however, most governments in the past preferred handouts as it helped them enrich themselves, not to mention encourage and perpetuate corruption. Mr Modi is working hard to ensure “achche din” for India’s billion-plus people, but one still has to see how these plans are implemented and monitored.
