Sunday, March 17, 2013
Skills and knowledge are the driving forces for economic growth and social development of a country. In rapidly growing economies like India with a vast and ever-increasing population, the problem is two-fold. On one hand, there is a severe paucity of highly-trained, quality labour, while on the other; large sections of the population possess little or no job skills.
As the Indian economy continues to transform and mature, large scale sectoral shifts in the working population are inevitable, particularly from agriculture to other sectors of the economy. These sectors, however, require significantly different and often special skill sets, which require training and skill development. This skill gap needs to be addressed through comprehensive efforts, at various levels and catering to different needs of the society and industry.
Skill development can be viewed as an instrument to improve the effectiveness and contribution of labor to the overall production. It is an important ingredient to push the production possibility frontier outward and to take growth rate of the economy to a higher trajectory. Skill building could also be seen as an instrument to empower the individual and improve his/her social acceptance or value.
Youth energy needs proper reshaping to make it constructive. If not it may be destructive in few cases. Government of India decided in May 2008 for coordinated action for skill development and to set-up a national skill development corporation. A national council was constituted on skill development under the chairmanship of prime minister.
Further the Ministry of Labour and Employment formulated a National Policy on skill development in 2009. The policy aims to create a workforce empowered with improved skills, knowledge and internationally recognized qualifications. So that workforce can gain access to decent employment and ensure India’s competitiveness in dynamic Global Labour market.
The council meets periodically to achieve the mandate on skill development. This aims to create 500 million skilled people by 2020. It is planned that Skill development system would be designed for high inclusivity. The system must be dynamic and self- healing.
India is a youthful nation. The United Nations defines youth as people between ages 15 and 24. On this scale, India has approximately 240 million youth. The median age in India is 25, meaning that half of the population is below 25 and half is above it.
It was envisioned that rigid boundaries between categories of education e.g. diploma and degree has created a structure of rigid “caste system” within education. This must be transformed into a more open/flexible system that permits competent individuals to accumulate their knowledge and skills.
Planning commission conceived setting up of 50000 Skill Development centers over the plan period. An alternative model could be to make available to public institution above the high school level, after class hours for skill development. ITIs, Employment Exchanges, Employment Officers etc are controlled by States. States must be incentivized to set-up missions that do not undertake delivery but as an aggregator and aligner of skill efforts.
The Finance Minister announced the formation of the National Skill Development Corporation (NSDC) in the Budget Speech (2008-09): “There is a compelling need to launch a world class skill development programme in Mission mode that will address the challenge of imparting the skills required by a growing economy. Both the structure and the leadership of the Mission must be such that the programme can be scaled up quickly to cover the whole country.”
NSDC is the first-of-its-kind Public-Private Partnership in India. It facilitates skill development. It acts as a catalyst by providing funding to enterprises, companies and organisations that provide skill training. It also develops appropriate models to enhance, support, and coordinate private sector initiatives.
In 2004-05, the total employment in the country was estimated at 459.1 million out of which 56.8 percent of workforce belonged to self employment, 28.9 percent to casual labor, and 14.3 percent to regular wages. About 8 percent of the total work force in India is employed in the organized sector, while the remaining 92 percent are in the non-formal sector. Employment needs to be generated in all the sectors, namely primary, secondary, and territory.
Self employment and small business continue to play a vital role in employment generation. It is, therefore, necessary to promote main employment generation activities like (a) agriculture, (b) labor intensive manufacturing sector such as food processing, leather products, textiles (c) services sectors: trade, restaurants and hotels, tourism, construction and information technology and (d) small and medium enterprises.
Innovative schemes to promote skill development like “Skill Development Initiative” (SDI), Kaushal Vikas Yojana (KVY) for setting up Industrial Training Institutes and Skill Development Centers in uncovered areas and skill development plan for districts affected by Left Wing Extremism, would help.
In order to strengthen skill development initiative in the country, the Budget for 2012-13 has doubled allocation under the National Skill Development Fund (NSDF) and launched a credit guarantee fund for skills development. Rs 1, 000 crore has been infused into NSDF raising the corpus of the fund to Rs 2,500 crore.
Among states Gujarat skill development mission is doing good job. CM Modi compared his latest budget for Gujarat with the Union budget for 2013-14 to emphasise his thrust on development and jobs.“Indian government allocated Rs.1,000 crore for skill development for the entire country, whereas Gujarat being a small state has allocated Rs.800 crore. This will help you to gauge our commitment towards youth and skill development,” he commented
Productive employment is a basic right of individual. It not only provides a wage but also is an expression of self-fulfilment and dignity. Skill development approach and planning are in right direction. But progress is disappointing. Still many State Missions are not fully functional. Budget comparison of India and Gujarat for 2012-13 on skill development speaks a lot. It proves non- seriousness on the part of government of India.
Heera Lal (Views are personal and based different sources)
Sunday, March 10, 2013
Strong opposition less corruption. Strong opposition means better governance. In general we don't criticize opposition for failing to discharge the role of OPPOSITION. In real sense and in the real spirit of our constitution both are equally responsible for any activity harming the nation in anyway.
In India, there is a parliamentary system of government, according to which the party with the highest majority through a general election is entitled to form the government and its leader becomes the Prime Minister of the country.
The second largest party becomes the opposition party and its leader enjoys the status of the leader of opposition. The ruling party (the government) during its tenure is free to determine the policies and programmes and make decisions for the welfare of the common people.
The opposition parties have a very significant role in a democracy, because they are the representatives of the people to safeguard their interests. Time to time, they criticize the government in case it fails to keep its promises.
The opposition parties also warn the government if they think it necessary. Sometimes they show their protest too against the government. Thus they try to keep the government aware of all the issues so that everything may be on the right path and all round development may be seen in the country.
The most dominant role of the opposition in a democracy is that of a 'watch dog' of the system. In a country where there is a two party system, the opposition party forms a 'shadow cabinet' and remains vigilant over the performance of the government. This is truer when we talk of United Kingdom.
But in a country like India where there is a multi-party system of governance, the very purpose of the opposition is marred. No doubt the opposition parties try to co-operate among themselves over particular issues but most of the time they waste their time in blaming each other instead of playing the role of check and balance to correct democratic practices in the interest of the entire public.
In India there are many parties and the sad truth is that nearly every party is built not around ideology but around the personality of a single leader or a family dynasty. One party hates another and criticizes its activities. As a result they fail to raise such issues that are more relevant to the cause of public. They fail to compel the government to do welfare works. And thus the government very easily overlooks them and conceals the facts related to them.
In a democratic set of a country the Prime Minister has been invested with so many powers that he/she can easily become a dictator. India has already witnessed such an incident when in 1975 the then Prime Minister, Mrs. Indira Gandhi, after the defeat at Allahabad High Court, declared the state of Emergency in India and turned to be a dictator.
It was unconstitutional, still she did it. In such a moment the vote of opposition becomes more prominent, because only a responsible opposition party can spread a mass consciousness against such unconstitutional move of the ruling party. Unfortunately, in our country the opposition parties have completely forgotten their positive contribution and responsibility to the nation.
They never try to extend their support to the ruling party in their welfare measures. Instead they only oppose the government, which is in no way a healthy atmosphere for the progress of the country. All the parties think only for the next election not for the next generation. The opposition must realise their responsibility and work for the country. Only a responsible opposition party can bring success to the ideals of our constitution.
(Views are personal and based on different sources)
Sunday, March 3, 2013
India is a youthful nation. India’s young people are on the move. They are reaching for new opportunities made possible. The United Nations defines youth as people between ages 15 and 24. By this measure, there are approximately 240 million youth in India, about 20% of the population, according to preliminary projections from the 2011 census. That’s up from 195 million in 2001.
The median age in India is 25, meaning that half the population is below 25 and half is above it. Compare India to Canada, whose youth make up just 12% of its population and where the median age is almost 40.
What’s the significance of these numbers for India? They mean that hundreds of millions of young people are or soon will be looking for jobs and spouses. If those hopes aren’t fulfilled, aspiration may turn to frustration. And, some social scientists say, that frustration can manifest itself in rising crime.
Demographic change in India is opening up new economic opportunities. As in many countries, declining infant and child mortality helped to spark lower fertility, effectively resulting in a temporary baby boom. As this cohort moves into working ages, India finds itself with a potentially higher share of workers as compared with dependents. If working-age people can be productively employed, India’s economic growth stands to accelerate.
Theoretical and empirical literature on the effect of demographics on labor supply, savings, and economic growth underpins this effort to understand and forecast economic growth in India. Policy choices can potentiate India’s realization of economic benefits stemming from demographic change. Failure to take advantage of the opportunities inherent in demographic change can lead to economic stagnation.
However, demography is not destiny; growth of the working-age share of the population does not automatically lead to an acceleration of economic growth. Demographic change may provide a boost to economic growth, but appropriate policies are needed to allow this to happen.
Without such policies, a country may instead find itself with large numbers of unemployed or underemployed working-age individuals. This scenario would be a “demographic disaster”, instead of a demographic dividend, in some instances promoting state fragility and failure, potentially with adverse political, social, economic, and ecological spillovers to other countries.
An additional demographic fact deserves mention: there are an estimated 11.4 million Indians living outside of India. The countries to which Indians have emigrated in largest numbers, as of 2010, are United Arab Emirates (2.2 million), the United States (1.7 million), Saudi Arabia (1.5 million), and Bangladesh (1.1 million). In 2000, 57,000 Indian physicians were living overseas.
In 2010, Indian emigrants are estimated to be sending home remittances totaling $55 billion, the most of any country, constituting about 4.5% of GDP. (Ratha, Mohapatra, and Silwal, 2011) The number of Indian immigrants in the United States has grown rapidly in recent years (there were 1.0 million in 2000). Their median age is 37, and just over half are female. Nearly three-quarters have at least a bachelor’s degree and nearly half work in professional occupations.
Mean personal income (in 2008 dollars) is $53,000, and median household income is $92,000. (United States Bureau of the Census, International Data Base (2008 midyear estimates). As political, economic, and social conditions change over time in India and its neighbors, the number of migrants, the skills they take to other countries, and the value of the remittances they send may change significantly.
India’s demographic evolution over the coming decades will provide a potential boost to its rate of economic growth – at a time when China will be losing the demographic impetus that has helped spur its economy. But the process is not automatic. Policy choices in the areas of governance, macroeconomic management, trade, and human capital formation can have a significant effect on realization of the demographic dividend.
Central to capturing the dividend is providing an economic environment in which working-age people are productively employed. Failure in this endeavor could result in a demographic disaster rather than a demographic dividend.
Demographics matter to the pace and process of economic growth and development – in India and elsewhere. While many factors influence economic growth, few are more important and reliable than demography. India’s changing demographics are creating a strong impulse for economic growth, and policymakers have several options for making this potential demographic dividend a reality.
The World Economic Forum (WEF) has released the Global Competitiveness Report 2012–2013. India ranks 59th overall among 144 economies, down three places from last year. Since reaching its peak at 49th in 2009, India has lost 10 places.
Once ahead of Brazil and South Africa, India now trails them by some 10 places and lags behind China by a margin of 30 positions. India continues to be penalized for its disappointing performance in the areas considered to be the basic factors underpinning competitiveness. The country’s supply of transport, ICT, and energy infrastructure remains largely insufficient and ill-adapted to the needs of the economy (84th).
It must be noted, however, that the situation has been slowly improving since 2006. The picture is even bleaker in the health and basic education pillar (101st). Despite improvements across the board over the past few years, poor public health and education standards remain a prime cause of India’s low productivity.
Turning to the country’s institutions, discontent within the business community remains high about the lack of reforms and the perceived inability of the government to push them through. Indeed, public trust in politicians (106th) has been weakening for the past three years. Once ranked a satisfactory 37th in this dimension, India now ranks 70th. Meanwhile, the macroeconomic environment (99th) continues to be characterized by large and repeated public deficits and the highest debt-to-GDP ratio among the BRICS. On a more positive note, inflation returned to single-digit territory in 2011.
Despite these considerable challenges, India does possess a number of strengths in the more advanced and complex drivers of competitiveness. This “reversed” pattern of development is characteristic of India. It can rely on a fairly well developed and sophisticated financial market (21st) that can channel financial resources to good use, and it boasts reasonably sophisticated (40th) and innovative (41th) businesses.
Today, India is facing a crisis; we are at a critical juncture. We are facing the threat of downgrade in ratings, declining growth, dismal job creation, acute shortage of skilled workers, high current account deficit and fiscal deficit, total lack of new projects and decrease in investment in infrastructure.
Young India has tremendous energy to overcome all above mentioned problems. We are surplus of human power. Our policy makers- particularly young political actors- need to take a serious note of it. To make these human energies suitable for the use in different sectors, we need to orient them as per demand. We have to skill them to make them employable and fit for jobs and demands. Such steps can convert this energy into pubic goods.
Government of India (GoI) and State governments need to work closely in tandem on this issue. There are many ways to achieve this goal. One of them is skill development of youths. A mammoth pool of talent continue to make India one of the most preferred destinations for Foreign Direct Investment
This Budget (2013) has also almost failed to address one of the grave problems of shortage of skilled workers, something that even US PresidentBarack Obama has taken note of. The UPA government has allocated a mere Rs 1,000 crore for skill development. Contrast that with the Rs 800 crore that just one state, Gujarat, has allocated for skill development. A comparison proves glaring situation.
Young India is a new catch for public actors. It is a new playing field for young political actors. Recent big protests against corruption and rape made us to feel and assess the gravity of this energy and discontent among masses. This new energy is in limelight which provides an opportunity to our policy makers to use them productively in nation making.
Youth energy is like an atomic energy. We can use it both ways. It can be changed for generating electricity or for making destructive bombs. This is an opportunity in the hands for our policy makers. They can enact laws for them. These laws will facilitate the conversion of youth energy into public goods. If this will not happen, then this energy may bring harm to the nation.
Young India is both voter and resource. Our political actors have to see from this angle. This natural resource is the ladder to power corridor. The political parties are always in search of political issues. They develop political product from such social and political situations.
The United Nations (UN) has declared 12 August as Youth Day. In 1985, The UN celebrated the first International Year of Youth. The Secretary- General Ban ki-moon says “To unleash the power of young people, we need to partner with them”. Our different level governments can use this day to launch projects, programs and to pronounce rules, regulations for this segment to partner with them.
Political products are sold during campaign for gaining power. This Youth India is a potent political issue to play with, albeit safely and cautiously. Those who will be able to tame this new segment of political landscape will rule in states and at centre.
Heera Lal (Views are personal and based on different sources)