Elusive Hunt for Skills and Jobs (Business Standard)
Senior Fellow Arvind Subramanian is quoted in a Business Standard piece on why changes in the Indian budget won't improve job creation for youth.
As such, the budget for 2013-14 "has before it one overarching goal: To create opportunities for our youth to acquire education and skills that will get them decent jobs or self-employment that will bring them adequate incomes".
To make this happen, the finance minister has increased funding for a range of projects and programmes that would help achieve this goal-even if the quantum of allocations was exaggerated by basing these on the revised estimates and not the actual sums earmarked in the 2012-13 budget. The allocation for the government's flagship education programme for elementary schooling, Sarva Shiksha Abhiyan or SSA (based on the Right to Education Act) was upped from Rs 25,555 crore to Rs 27,258 crore, and for the Rashtriya Madhyamik Shiksha Abhiyan (secondary school education) from Rs 3,124 crore to Rs 3,983 crore. These will be the major components of Rs 65,867 crore allocation for the Ministry of Human Resource Development, an increase of 17 per cent over the revised estimates of the previous year. (THE INDIAN ADVANT-AGE)
Another Rs 1,000 crore has been earmarked for motivating the youth to voluntarily join skill development programmes. Each young person who undergoes training for a particular skill and passes the standard test set for it will be given a certificate and a reward of an average of Rs 10,000 per candidate. Chidambaram's assumption is that 1,000,000 youth can be so motivated and thus "give an enormous boost to employability and productivity". To this end, the National Skill Development Corporation, a public private partnership driven by industry, will be asked to set the standards.
On the other hand, industry, which should have absorbed this, shed 5.03 million jobs, according to the just released draft 12th Plan approved by the National Development Council, the country's apex policy making body, in December 2012. Overall, employment in the country increased only marginally from 457.46 million to 460.22 million during this period, thanks to the service sector. The draft Plan, like the Economic Survey, has called for enhanced skill development programmes and mechanisms to improve the employability of the workforce.
But there is another view that India may have missed the bus on employing large numbers in manufacturing. "We have developed based on skilled services rather than using our abundant pool of unskilled labour," points out Arvind Subramanian, senior fellow at the Peterson Institute for International Economics and director of the India Initiative at the Center for Global Development. He told a recent seminar organised by the University of Pennsylvania's Centre for the Advanced Study of India that East Asia and China developed by using low-skilled, abundant labour in the early phases whereas India has completely neglected that.
It is clearly too late for India to build a manufacturing sector for unskilled labour since much of manufacturing is now geared towards using high-end technology.
Yet, it needs to skill 500 million people in less than 10 years. It is a mammoth task that cannot be undertaken with the woefully small sops provided by Chidambaram.
