News Snippet
- News 1: Employment Survey – (A survey by Labour Ministry gives a good idea of the employment scenario in India and the sectors responsible for the employment)
- News 2: India Tourism Statistics – (Gives an idea about which countries are important for Tourism sector)
- News 3: PM Modi in Tokyo to attend Shinzo Abe’s Funeral – (PM Modi in Tokyo to attend Shinzo Abe’s funeral and Indo-Japan relation)
- News 4: NASA’s DART – (Gives an idea about the mission, its objective, information about asteroids and Space mining)
- News 5: Jaldoot – (App for groundwater level monitoring. You must remember the under which act the Central Ground Water Authority was created.)
- News 6: IMEI (All that you need to know about IMEI)
- News 7: Ocean Warming (Horrifying hurricanes and cyclones)
- Other important News:
- From where our govt gets the money?
- CBI
- Malthus population theory- Was he right or wrong?
News 1: Employment Survey
Background
Manufacturing continues to be the largest institutional employer in the country, employing about 38.5% of the workers, according to the Quarterly Employment Survey (QES), which is a part of the All-India Quarterly Establishment based Employment Survey (AQEES).
Data
- Education, manufacturing, trade and financial services together accounted for 84% of the total estimated units.
- Manufacturing sector accounts for the largest percentage (38.5%) of the total number of workers, followed by education sector with 21.7%, IT/BPO sector with 12% and health sector 10.6%.
- The participation of women workers witnessed a marginal increase.
- However, women workers constituted about 52% of the workforce in the health sector, while the corresponding percentages in education, financial services and IT/ BPO sectors stood at 44%, 41% and 36%, respectively.
- It is noteworthy that in financial services, women far outnumber men among self-employed persons.
All India Quarterly Establishment based Employment Survey (AQEES)
- Ministry: Ministry of Labour and Employment
- The AQEES will provide quarterly updates about the employment in 9 sectors in both organized and unorganized segments.
- The nine selected sectors are Manufacturing, Construction, Trade, Transport, Education, Health, Accommodation & Restaurant, IT/BPO and Financial Services.
News 2: Indian Tourism statistics
Background
- The COVID-19 pandemic and the resulting restrictions saw foreign tourist arrivals in India dip by almost 45% in 2021.
- The arrival of NRIs, however, increased by 53% in 2021 compared with 2020.
- In 2021, the top 15 countries from which foreign tourists arrived in India included the U.S., the U.K., Bangladesh, Canada, Nepal, Afghanistan and Australia. These nations accounted for nearly 81% of foreign tourist arrivals in India last year.
- Interestingly, the number of Indian nationals departing the country saw a rise in 2021 as compared to 2020.
- The UAE was the top destination for Indians in 2021, followed by the U.S., Qatar, Oman and the U.K.
News 3: PM Modi in Tokyo to attend Shinzo Abe’s Funeral
Background
Mr. Modi, along with several heads of state and government, attended Mr. Abe’s funeral in the Nippon Budokan arena, where Mr. Kishida and his predecessor, Yoshihide Suga, offered emotional tributes to their former leader.
India – Japan relations
Genesis
Exchange between Japan and India is said to have begun in the 6th century when Buddhism was introduced to Japan. Indian culture, filtered through Buddhism, has had a great impact on Japanese culture, and this is the source of the Japanese people’s sense of closeness to India.
India’s earliest documented direct contact with Japan was with the Todaiji Temple in Nara, where the consecration or eye-opening of the towering statue of Lord Buddha was performed by an Indian monk, Bodhisena, in 752 AD
Japan and India signed a peace treaty and established diplomatic relations on 28th April 1952. This treaty was one of the first peace treaties Japan signed after World War II.
In the post-World War II period, India’s iron ore helped a great deal Japan’s recovery from the devastation. Following Japanese Prime Minister Nobusuke Kishi’s visit to India in 1957, Japan started providing yen loans to India in 1958, as the first yen loan aid extended by Japanese government.
Diplomatic Relations
Prime Minister Yoshiro Mori’s visit to India in August 2000 provided the momentum to strengthen the Japan-India relationship. Mr. Mori and Prime Minister Atal Bihari Vajpayee decided the establishment of “Global Partnership between Japan and India“. Since Prime Minister Junichiro Koizumi’s visit to India in April 2005, Japan-India annual summit meetings have been held in respective capitals.
When Prime Minister Manmohan Singh visited Japan in December 2006, Japan-India relationship was elevated to the “Global and Strategic Partnership“.
In September 2014, Prime Minister Narendra Modi paid an official visit to Japan and had a summit meeting with Prime Minister Shinzo Abe. They concurred to upgrade the bilateral relationship to “Special Strategic and Global Partnership”
In December 2015, Prime Minister Abe paid an official visit to India and had a summit meeting with Prime Minister Narendra Modi. The two Prime Ministers resolved to transform the Japan-India Special Strategic and Global Partnership into a deep, broad-based and action-oriented partnership, which reflects a broad convergence of their long-term political, economic and strategic goals.
They announced, “Japan and India Vision 2025 Special Strategic and Global Partnership Working Together for Peace and Prosperity of the Indo-Pacific Region and the World”, a joint statement that would serve as a guidepost for the “new era in Japan-India relations.”
In the Japan-India Vision Statement issued during Prime Minister Modi’s visit to Japan in October 2018, two leaders reiterated their unwavering commitment to working together towards a “Free and Open Indo-Pacific”.
Cooperation in security fields
During Prime Minister Singh’s visit to Japan in October 2008, two leaders issued “the Joint Declaration on Security Cooperation between Japan and India”. There are also various frameworks of security and defense dialogue between Japan and India including Foreign and Defense Ministerial Meeting (“2+2” meeting), annual Defense Ministerial Dialogue and Coast Guard-to-Coast Guard dialogue.
On September 9th, 2020, the Agreement between the Government of Japan and the Government of the Republic of India Concerning Reciprocal Provision of Supplies and Services between the Self-Defense Forces of Japan and the Indian Armed Forces (so-called “Acquisition and Cross-Servicing Agreement” or ACSA) was signed. ACSA came into force on July 11th, 2021.
India and Japan have participated in multiple bilateral and multilateral exercises such as DHARMA GUARDIAN and MALABAR exercises.
Economic relations
The volume of trade between the two countries has increased. India was the 18th largest trading partner for Japan, and Japan was the 12th largest trading partner for India in 2020. Also, direct investment from Japan to India has been increased, and Japan was the 4th largest investor for India in FY2020.
At recent summit meetings, two leaders reconfirmed commitment to synergizing India’s demographic dividend and Japan’s capital and technology to realize the true potential of the Japan-India economic partnership for a prosperous future.
In this regard, two leaders welcomed the agreement to conclude a Bilateral Swap Arrangement of USD 75 billion, the launching of a comprehensive Japan-India Digital Partnership, and other cooperation and initiatives.
News 4: The NASA’s DART
Background
- NASA’s DART (Double Asteroid Redirection Test) spacecraft collided with the space rock Dimorphos (just 160 metres wide). NASA has confirmed that the collision of the auto-rickshaw sized 600 kilogram weighing DART, on the football stadium-sized Dimorphos, about five billion kilogram in mass (orbiting around the 780 metres wide primary asteroid Didymos), has deflected the trajectory of the pair of space rocks.
What are asteroids?
- As per NASA, Asteroids, sometimes called minor planets, are rocky, airless remnants left over from the early formation of our solar system about 4.6 billion years ago.
- Asteroids are small, rocky objects that orbit the Sun. Although asteroids orbit the Sun like planets, they are much smaller than planets.
- There are lots of asteroids in our solar system. Most of them are located in the main asteroid belt – a region between the orbits of Mars and Jupiter.
- Some asteroids go in front of and behind Jupiter. These are called Trojan asteroids.
- Asteroids that come close to Earth are called Near Earth Objects, NEOs for short.
Features of asteroids
- Asteroids aren’t all round like planets. They have irregular shapes.
- Some asteroids are hundreds of miles in diameter, but many more are as small as pebbles.
- Most asteroids are made of different kinds of rocks, but some have clays or metals, such as nickel and iron.
- Since asteroids formed at the same time as other objects in our solar system, these space rocks can give scientists lots of information about the history of planets and the sun.
- About 66 million years ago, an asteroid about 10-15 kms struck earth. The tsunami, volcanic eruptions and thick dust clouds ensuing from the blow decimated dinosaurs and nearly 75% of all species.
- What happened in the past can occur in the future. The chances of a giant asteroid striking earth are small; however, if it did occur, the devastation would be cataclysmic, wiping out the entire human civilization. NASA tracks and keeps a close watch on the nearly 26,115 asteroids whose orbits are dangerously close to earth.
What was NASA’s mission?
NASA, to put it simply, undertook the ‘kick’ technique. Compared to the massive Dimorphous, DART is a tiny Goliath. Yet crashing at a breakneck speed of 23,760 kilometres per hour, the momentum is adequate to slash the angular momentum of Dimorphos, making it speed up and move closer to Didymos. The pair’s trajectory is thus deflected as the net result of these dynamics.
What has been the impact assessment?
The DART craft carried a high-resolution DRACO (Didymos Reconnaissance and Asteroid Camera for Optical navigation) camera to observe the collision and its consequences. The close-up images until its fatal crash are being analyzed. Italian Space Agency-built Light Italian CubeSat for Imaging of Asteroids (LICIACube) took a ride with the DART.
The CubeSat was released and deployed two weeks before the impact. Hovering 50 kilometres from the asteroid, the two cameras aboard the CubeSat have captured the plume of the debris ejected by the collision.
What are the other possibilities of this technique?
- At the heels of NASA, China is set to deflect a 40m diameter earth-crossing asteroid called 2020 PN1 sometime in 2026.
- While the drive comes from the desire to protect earth from killer asteroids, perhaps the lure of space mining lurks behind.
- If one can tug a mineral-rich asteroid near the Moon or establish a space mining factory between the orbits of earth and Mars, precious mineral resources needed for decades could be easily sourced.
- The ‘kick’ technique that deflects asteroids can then be used to move a small asteroid into a convenient position for space mining.
- For developing green energy technologies — electric vehicles, solar panels, wind turbines, and energy storage devices — and ushering in the low carbon economy of the future, rare earth elements such as yttrium, niobium, rhodium, palladium, osmium, iridium and scandium are critical. They are short in supply, and asteroid mining, it is believed, could solve the rare earth supply problem.
Space missions
From the robotic Soviet Luna 16 in the 1970s to U.S. Apollo missions and China’s first lunar sample-return mission, Chang’e 5 — all have brought back lunar soil.
NASA’s Stardust spacecraft returned a canister full of dust from comet Wild-2 captured by an aerogel-based sample collector in 2004. Japan Aerospace Exploration Agency (JAXA)’s Hayabusa 1 to 25143 Itokawa, the Hayabusa 2 to 162173 Ryugu, and NASA’s OSIRIS-Rex to near-earth asteroid Bennu are missions to extract and return samples from asteroids.
News 5: Jaldoot – App to capture data on groundwater levels
Background
With the rapidly declining water table threatening to push many regions into drought, the Union government launched a mobile application — Jaldoot — jointly developed by the Rural Development and Panchayati Raj Ministries to monitor the groundwater levels across the country.
Central Ground Water Board
- Ministry: Ministry of Jal Shakti
- Central Ground Water Authority (CGWA) was constituted under the Environment (Protection) Act, 1986 for the purposes of regulation and control of ground water development and management in the country. The Authority is engaged in various activities related to regulation of ground water development to ensure its long-term sustainability.
News 6: DoT – IMEI registration by phone makers a must
Background
The Department of Telecommunications (DoT) has made it mandatory for mobile phone manufacturers to register the international mobile equipment identity (IMEI) — the 15-digit number that uniquely identifies each mobile device — of all handsets made in India with the government. Importers, too, will have to register with the government the IMEI of each phone before importing it.
What is an IMEI?
- The IMEI is a unique number that is used to identify a device on a mobile network. It has 15 digits and is like a phone’s unique identity. The number is used to verify the identity of a device when a user uses the Internet or places a call through it.
- Phones with a dual-SIM option has two IMEI numbers, one for each SIM. The IMEI number can help network providers track down a device in case it gets stolen or is lost. Once such loss or theft is reported, the carriers can deny the device access to the cellular network even with a new SIM card.
Why there is a need for compulsory registration?
In a bid to curtail the rampant cloning and theft of mobile phones across, the Communications Ministry had earlier rolled out a Central Equipment Identity Register. The identity register categorizes mobile phones based on their IMEI status in three lists — white, grey and black.
Mobile phones with IMEI numbers in the whitelist are permitted for use, while those in the blacklist are the ones that are reported stolen or lost and are not be allowed to access the network. Devices with IMEI numbers in the Grey list do not conform to standards but are permitted to connect under supervision. The register also allows the DoT to carry out IMEI-based “lawful interception”.
In 2017, the government had notified rules to prevent tampering of IMEI numbers of phones by making it a punishable offence which could also attract a jail term.
News 7: Ocean Warming and horrifying hurricane and cyclone
Background
As Earth’s climate warms, more storms like Hurricane Ian are undergoing this kind of rapid intensification, growing quickly from relatively weak tropical storms to Category 3 or higher hurricanes in under 24 hours, sometimes stunning forecasters and giving residents little time to prepare.
Warming oceans fuel higher winds and winds intensify more rapidly
- More than 90% of the excess heat from human-caused global warming over the past 50 years has been absorbed by the oceans.
- Since 1901, sea surface temperatures have risen an average of 0.14 degrees Fahrenheit per decade.
- That’s crucial, because storms gather strength over the ocean. And the warmer the water, the more power they pick up. Higher surface temperatures allow hurricanes to reach higher levels of maximum sustained wind, a common metric used to describe the intensity of a storm.
- Not only do warmer oceans make storms stronger, but they also make the rate of intensification more rapid.
- Researchers have found that the likelihood of a hurricane undergoing rapid intensification has increased to 5% from 1% since the 1980s.
Different names of tropical cyclone across the world
Other important news
Direct tax and Indirect tax
Direct tax:
Direct tax is a type of tax where the incidence and impact of taxation fall on the same entity.
In the case of direct tax, the burden can’t be shifted by the taxpayer to someone else. These are largely taxes on income or wealth. Income tax, corporation tax, property tax, inheritance tax and gift tax are examples of direct tax.
Indirect tax:
In the case of indirect tax, the burden of tax can be shifted by the taxpayer to someone else. Indirect tax has the effect to raising the price of the products on which they are imposed. Customs duty, central excise, service tax and value added tax are examples of indirect tax.
Central Bureau of Investigation (CBI)
- Ministry: Ministry of Personnel
- CBI is the Central police investigating agency of India and provides assistance to Central Vigilance Commission and Lokpal. It is also the nodal police agency in India, which coordinates investigation on behalf of Interpol Member countries.
- The CBI is not a statutory body but derives its power to investigate from the Delhi Special Police Establishment Act, 1946.
- The establishment of the CBI was recommended by the Santhanam Committee on Prevention of Corruption (1962–1964).
- CBI derives power to investigate from the Delhi Special Police Establishment Act, 1946 Section 2 of the Act vests DSPE with jurisdiction to investigate offences in the Union Territories only.
- However, the jurisdiction can be extended by the Central Government to other areas including Railway areas and States under Section 5(1) of the Act, provided the State Government accords consent under Section 6 of the Act.
- As per Section 3 of the Act, Special Police Establishment is authorized to investigate only those cases, which are notified by the Central Government from time to time.
Theory of the Malthusian trap
The Malthusian trap or Malthusian check refers to the theory that as the human population grows there is increasing pressure on earth’s resources, which in turn acts as a check on the further rise in population.
It is named after English economist Thomas Malthus who elaborated on the concept in his 1798 book An Essay on the Principle of Population, which quite famously inspired Charles Darwin.
Malthus argued that while rise in food production in a country can lead to improved living standards for the general population, the benefit is likely to be temporary. This is because, Malthus argued, increasing availability of food would encourage people to have more kids since they could afford to feed them now, thus leading to a rise in the total population and a drop in per capita income levels.
Malthus, in other words, believed that there was an inverse relationship between human population and living standards with rising population leading to lower living standards. In the pre-modern age, whenever there was a rise in food production due to whatever reason, this caused per capita income to rise for a while as long as population levels remained stable.
However, the population of the country increased quite quickly which ensured that per capita income returned to its historical trend. Whenever food production dropped on the other hand, there was famine which caused the death of a large number of people. The drop in human population continued until the country’s per capita income rose to subsistence levels. Either way, resource constraints kept a check on human population.
Criticism
Critics of the Malthusian trap believe that the industrial revolution decisively refuted Malthus as human population levels and living standards have risen in tandem ever since the event
According to critics, there may be no strict inverse correlation between population growth and the living standards of people. As long as human beings can find ways to use earth’s resources more efficiently, their population can grow without compromising their living standards even in the long-term.
In fact, some argue that as human population rises, the chances of breakthrough innovations happening rise manifold as there would be more human minds working on solving humanity’s problems.
Recent Posts
Petrol in India is cheaper than in countries like Hong Kong, Germany and the UK but costlier than in China, Brazil, Japan, the US, Russia, Pakistan and Sri Lanka, a Bank of Baroda Economics Research report showed.
Rising fuel prices in India have led to considerable debate on which government, state or central, should be lowering their taxes to keep prices under control.
The rise in fuel prices is mainly due to the global price of crude oil (raw material for making petrol and diesel) going up. Further, a stronger dollar has added to the cost of crude oil.
Amongst comparable countries (per capita wise), prices in India are higher than those in Vietnam, Kenya, Ukraine, Bangladesh, Nepal, Pakistan, Sri Lanka, and Venezuela. Countries that are major oil producers have much lower prices.
In the report, the Philippines has a comparable petrol price but has a per capita income higher than India by over 50 per cent.
Countries which have a lower per capita income like Kenya, Bangladesh, Nepal, Pakistan, and Venezuela have much lower prices of petrol and hence are impacted less than India.
“Therefore there is still a strong case for the government to consider lowering the taxes on fuel to protect the interest of the people,” the report argued.
India is the world’s third-biggest oil consuming and importing nation. It imports 85 per cent of its oil needs and so prices retail fuel at import parity rates.
With the global surge in energy prices, the cost of producing petrol, diesel and other petroleum products also went up for oil companies in India.
They raised petrol and diesel prices by Rs 10 a litre in just over a fortnight beginning March 22 but hit a pause button soon after as the move faced criticism and the opposition parties asked the government to cut taxes instead.
India imports most of its oil from a group of countries called the ‘OPEC +’ (i.e, Iran, Iraq, Saudi Arabia, Venezuela, Kuwait, United Arab Emirates, Russia, etc), which produces 40% of the world’s crude oil.
As they have the power to dictate fuel supply and prices, their decision of limiting the global supply reduces supply in India, thus raising prices
The government charges about 167% tax (excise) on petrol and 129% on diesel as compared to US (20%), UK (62%), Italy and Germany (65%).
The abominable excise duty is 2/3rd of the cost, and the base price, dealer commission and freight form the rest.
Here is an approximate break-up (in Rs):
a)Base Price | 39 |
b)Freight | 0.34 |
c) Price Charged to Dealers = (a+b) | 39.34 |
d) Excise Duty | 40.17 |
e) Dealer Commission | 4.68 |
f) VAT | 25.35 |
g) Retail Selling Price | 109.54 |
Looked closely, much of the cost of petrol and diesel is due to higher tax rate by govt, specifically excise duty.
So the question is why government is not reducing the prices ?
India, being a developing country, it does require gigantic amount of funding for its infrastructure projects as well as welfare schemes.
However, we as a society is yet to be tax-compliant. Many people evade the direct tax and that’s the reason why govt’s hands are tied. Govt. needs the money to fund various programs and at the same time it is not generating enough revenue from direct taxes.
That’s the reason why, govt is bumping up its revenue through higher indirect taxes such as GST or excise duty as in the case of petrol and diesel.
Direct taxes are progressive as it taxes according to an individuals’ income however indirect tax such as excise duty or GST are regressive in the sense that the poorest of the poor and richest of the rich have to pay the same amount.
Does not matter, if you are an auto-driver or owner of a Mercedes, end of the day both pay the same price for petrol/diesel-that’s why it is regressive in nature.
But unlike direct tax where tax evasion is rampant, indirect tax can not be evaded due to their very nature and as long as huge no of Indians keep evading direct taxes, indirect tax such as excise duty will be difficult for the govt to reduce, because it may reduce the revenue and hamper may programs of the govt.
Globally, around 80% of wastewater flows back into the ecosystem without being treated or reused, according to the United Nations.
This can pose a significant environmental and health threat.
In the absence of cost-effective, sustainable, disruptive water management solutions, about 70% of sewage is discharged untreated into India’s water bodies.
A staggering 21% of diseases are caused by contaminated water in India, according to the World Bank, and one in five children die before their fifth birthday because of poor sanitation and hygiene conditions, according to Startup India.
As we confront these public health challenges emerging out of environmental concerns, expanding the scope of public health/environmental engineering science becomes pivotal.
For India to achieve its sustainable development goals of clean water and sanitation and to address the growing demands for water consumption and preservation of both surface water bodies and groundwater resources, it is essential to find and implement innovative ways of treating wastewater.
It is in this context why the specialised cadre of public health engineers, also known as sanitation engineers or environmental engineers, is best suited to provide the growing urban and rural water supply and to manage solid waste and wastewater.
Traditionally, engineering and public health have been understood as different fields.
Currently in India, civil engineering incorporates a course or two on environmental engineering for students to learn about wastewater management as a part of their pre-service and in-service training.
Most often, civil engineers do not have adequate skills to address public health problems. And public health professionals do not have adequate engineering skills.
India aims to supply 55 litres of water per person per day by 2024 under its Jal Jeevan Mission to install functional household tap connections.
The goal of reaching every rural household with functional tap water can be achieved in a sustainable and resilient manner only if the cadre of public health engineers is expanded and strengthened.
In India, public health engineering is executed by the Public Works Department or by health officials.
This differs from international trends. To manage a wastewater treatment plant in Europe, for example, a candidate must specialise in wastewater engineering.
Furthermore, public health engineering should be developed as an interdisciplinary field. Engineers can significantly contribute to public health in defining what is possible, identifying limitations, and shaping workable solutions with a problem-solving approach.
Similarly, public health professionals can contribute to engineering through well-researched understanding of health issues, measured risks and how course correction can be initiated.
Once both meet, a public health engineer can identify a health risk, work on developing concrete solutions such as new health and safety practices or specialised equipment, in order to correct the safety concern..
There is no doubt that the majority of diseases are water-related, transmitted through consumption of contaminated water, vectors breeding in stagnated water, or lack of adequate quantity of good quality water for proper personal hygiene.
Diseases cannot be contained unless we provide good quality and adequate quantity of water. Most of the world’s diseases can be prevented by considering this.
Training our young minds towards creating sustainable water management systems would be the first step.
Currently, institutions like the Indian Institute of Technology, Madras (IIT-M) are considering initiating public health engineering as a separate discipline.
To leverage this opportunity even further, India needs to scale up in the same direction.
Consider this hypothetical situation: Rajalakshmi, from a remote Karnataka village spots a business opportunity.
She knows that flowers, discarded in the thousands by temples can be handcrafted into incense sticks.
She wants to find a market for the product and hopefully, employ some people to help her. Soon enough though, she discovers that starting a business is a herculean task for a person like her.
There is a laborious process of rules and regulations to go through, bribes to pay on the way and no actual means to transport her product to its market.
After making her first batch of agarbathis and taking it to Bengaluru by bus, she decides the venture is not easy and gives up.
On the flipside of this is a young entrepreneur in Bengaluru. Let’s call him Deepak. He wants to start an internet-based business selling sustainably made agarbathis.
He has no trouble getting investors and to mobilise supply chains. His paperwork is over in a matter of days and his business is set up quickly and ready to grow.
Never mind that the business is built on aggregation of small sellers who will not see half the profit .
Is this scenario really all that hypothetical or emblematic of how we think about entrepreneurship in India?
Between our national obsession with unicorns on one side and glorifying the person running a pakora stall for survival as an example of viable entrepreneurship on the other, is the middle ground in entrepreneurship—a space that should have seen millions of thriving small and medium businesses, but remains so sparsely occupied that you could almost miss it.
If we are to achieve meaningful economic growth in our country, we need to incorporate, in our national conversation on entrepreneurship, ways of addressing the missing middle.
Spread out across India’s small towns and cities, this is a class of entrepreneurs that have been hit by a triple wave over the last five years, buffeted first by the inadvertent fallout of demonetization, being unprepared for GST, and then by the endless pain of the covid-19 pandemic.
As we finally appear to be reaching some level of normality, now is the opportune time to identify the kind of industries that make up this layer, the opportunities they should be afforded, and the best ways to scale up their functioning in the shortest time frame.
But, why pay so much attention to these industries when we should be celebrating, as we do, our booming startup space?
It is indeed true that India has the third largest number of unicorns in the world now, adding 42 in 2021 alone. Braving all the disruptions of the pandemic, it was a year in which Indian startups raised $24.1 billion in equity investments, according to a NASSCOM-Zinnov report last year.
However, this is a story of lopsided growth.
The cities of Bengaluru, Delhi/NCR, and Mumbai together claim three-fourths of these startup deals while emerging hubs like Ahmedabad, Coimbatore, and Jaipur account for the rest.
This leap in the startup space has created 6.6 lakh direct jobs and a few million indirect jobs. Is that good enough for a country that sends 12 million fresh graduates to its workforce every year?
It doesn’t even make a dent on arguably our biggest unemployment in recent history—in April 2020 when the country shutdown to battle covid-19.
Technology-intensive start-ups are constrained in their ability to create jobs—and hybrid work models and artificial intelligence (AI) have further accelerated unemployment.
What we need to focus on, therefore, is the labour-intensive micro, small and medium enterprise (MSME). Here, we begin to get to a definitional notion of what we called the mundane middle and the problems it currently faces.
India has an estimated 63 million enterprises. But, out of 100 companies, 95 are micro enterprises—employing less than five people, four are small to medium and barely one is large.
The questions to ask are: why are Indian MSMEs failing to grow from micro to small and medium and then be spurred on to make the leap into large companies?
At the Global Alliance for Mass Entrepreneurship (GAME), we have advocated for a National Mission for Mass Entrepreneurship, the need for which is more pronounced now than ever before.
Whenever India has worked to achieve a significant economic milestone in a limited span of time, it has worked best in mission mode. Think of the Green Revolution or Operation Flood.
From across various states, there are enough examples of approaches that work to catalyse mass entrepreneurship.
The introduction of entrepreneurship mindset curriculum (EMC) in schools through alliance mode of working by a number of agencies has shown significant improvement in academic and life outcomes.
Through creative teaching methods, students are encouraged to inculcate 21st century skills like creativity, problem solving, critical thinking and leadership which are not only foundational for entrepreneurship but essential to thrive in our complex world.
Udhyam Learning Foundation has been involved with the Government of Delhi since 2018 to help young people across over 1,000 schools to develop an entrepreneurial mindset.
One pilot programme introduced the concept of ‘seed money’ and saw 41 students turn their ideas into profit-making ventures. Other programmes teach qualities like grit and resourcefulness.
If you think these are isolated examples, consider some larger data trends.
The Observer Research Foundation and The World Economic Forum released the Young India and Work: A Survey of Youth Aspirations in 2018.
When asked which type of work arrangement they prefer, 49% of the youth surveyed said they prefer a job in the public sector.
However, 38% selected self-employment as an entrepreneur as their ideal type of job. The spirit of entrepreneurship is latent and waiting to be unleashed.
The same can be said for building networks of successful women entrepreneurs—so crucial when the participation of women in the Indian economy has declined to an abysmal 20%.
The majority of India’s 63 million firms are informal —fewer than 20% are registered for GST.
Research shows that companies that start out as formal enterprises become two-three times more productive than a similar informal business.
So why do firms prefer to be informal? In most cases, it’s because of the sheer cost and difficulty of complying with the different regulations.
We have academia and non-profits working as ecosystem enablers providing insights and evidence-based models for growth. We have large private corporations and philanthropic and funding agencies ready to invest.
It should be in the scope of a National Mass Entrepreneurship Mission to bring all of them together to work in mission mode so that the gap between thought leadership and action can finally be bridged.