An inclusive India would be one where good jobs are available to all people everywhere.The Indian economy’s employment elasticity has been declining in the last few years.
Prime Minister declared his vision for a “New India” in his victory speech after sweeping the Uttar Pradesh elections. “The poor want a leg-up, not a handout,” he said. A few days earlier, a national newspaper summarized what its journalists had gathered from citizens at election rallies. It reported this on its front page in the plea of a Dalit woman. “Give my husband a job: I don’t want LPG,” she said.
Jobs and livelihoods are what people want. Considering the huge population of the young that India has—the largest in the world—India should also be generating more jobs than other countries. But the Indian economy is a laggard in job creation despite good GDP (gross domestic product) growth. India’s rate of job creation is only two-thirds of the global average. Moreover, the employment elasticity of the Indian economy—the numbers of jobs it creates with economic growth—has been declining in the last few years. Modi must pull the aeroplane out of a nose-dive to lead the country to a vision of an inclusive India, where good jobs are available to all people everywhere, including Dalit men and women in the backwaters of India’s heartland.
Two recent reports, both produced jointly by the Confederation of Indian Industry and Boston Consulting Group, have analysed the reasons for low job creation and suggested how more jobs can be generated.
One, “India: Growth And Jobs In The New Globalization”, looks at global forces that are creating unemployment and increasing inequality around the world. “Capitalization” of production systems, with increasing automation, is reducing jobs for workers, and producing more wealth for owners of capital than for workers in production systems. “Financializing” of economies, with even more money being made from purely financial assets, has turbo-charged the increase in inequalities in incomes and wealth around the world. The report also points out that “Industry 4.0” automation technologies, more flexible, and less dependent on labour, are enabling production systems to be localized within developed countries’ markets. Combined with the pressure on governments everywhere to generate more jobs within their own countries, production systems are likely to become more local and less globally interconnected than they have been in the past 20 years.
Each country must develop its own job-creation strategies with the participation of domestic stakeholders because, while technology is universal across countries, social and economic conditions vary. The other report, “Future Of Jobs In India, Enterprises And Livelihoods”, is focused on India, and was prepared with the participation of over 170 diverse organizations and persons. It takes a broad systems’ view of the process of job creation, including societal forces that will make technology adapt to societal needs.
Both reports recommend strategies for:
(1) strengthening clusters and networks of small enterprises which can create more widespread employment and with less capital investment than large factories;
(2) developing life-long learning systems that will enable people to learn new skills “just-in-time” when the content of their work changes, which it will often in future when new technologies are applied and new industries emerge;
(3) re-framing labour law reform from a paradigm of more flexibility to “hire and fire” to a paradigm of better social security systems, without which societies will not allow employers more freedom to shape contracts with those who work in their enterprises (which Uber, for example, is discovering in many countries); and
(4) providing easier access to finance for micro-enterprises. Both reports also highlight the Brahma face of technology as a creator of jobs, while recognizing its Shiva face of a destroyer of jobs at the same time.
A youthful country of 1.2 billion people, with the largest number of employment seekers in the world, must create more jobs in many sectors. It must pursue more growth in manufacturing and build infrastructure.
It must vigorously pursue other avenues too. India has a large growth opportunity in natural produce sectors—food, fruits, vegetables, dairy, poultry and fish.
Rural and urban economies support each other through natural produce supply chains. Natural produce enterprises can generate jobs around the country. India has enormous and diverse assets of natural beauty, heritage and culture, spread across all its states.
Therefore, another sector where India has huge, insufficiently tapped potential for widespread generation of livelihoods is tourism and hospitality. Some other sectors with large potential for more enterprises and sources of livelihoods around the country are healthcare, renewable energy, water and sanitation.
A vision of a “new India”, with widespread opportunities for “a leg-up” for all, requires a coordinated, “whole of government” approach to policy reforms which are explained in the second report. It highlights that job creation must become an overarching goal for government along with economic growth, which it has not been so far.
Plans at all levels of government—at the Centre, in the states, and in cities—must be directed towards creating ecosystems that generate better livelihoods and jobs, and progress must be measured accordingly.
Finally, since jobs emerge from a healthy jobs ecosystem and cannot be sprinkled into the economy from above, many stakeholder groups must participate in systematic processes at the Central, state and city levels for finding and implementing solutions together.
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- In the Large States category (overall), Chhattisgarh ranks 1st, followed by Odisha and Telangana, whereas, towards the bottom are Maharashtra at 16th, Assam at 17th and Gujarat at 18th. Gujarat is one State that has seen startling performance ranking 5th in the PAI 2021 Index outperforming traditionally good performing States like Andhra Pradesh and Karnataka, but ranks last in terms of Delta
- In the Small States category (overall), Nagaland tops, followed by Mizoram and Tripura. Towards the tail end of the overall Delta ranking is Uttarakhand (9th), Arunachal Pradesh (10th) and Meghalaya (11th). Nagaland despite being a poor performer in the PAI 2021 Index has come out to be the top performer in Delta, similarly, Mizoram’s performance in Delta is also reflected in it’s ranking in the PAI 2021 Index
- In terms of Equity, in the Large States category, Chhattisgarh has the best Delta rate on Equity indicators, this is also reflected in the performance of Chhattisgarh in the Equity Pillar where it ranks 4th. Following Chhattisgarh is Odisha ranking 2nd in Delta-Equity ranking, but ranks 17th in the Equity Pillar of PAI 2021. Telangana ranks 3rd in Delta-Equity ranking even though it is not a top performer in this Pillar in the overall PAI 2021 Index. Jharkhand (16th), Uttar Pradesh (17th) and Assam (18th) rank at the bottom with Uttar Pradesh’s performance in line with the PAI 2021 Index
- Odisha and Nagaland have shown the best year-on-year improvement under 12 Key Development indicators.
- In the 60:40 division States, the top three performers are Kerala, Goa and Tamil Nadu and, the bottom three performers are Uttar Pradesh, Jharkhand and Bihar.
- In the 90:10 division States, the top three performers were Himachal Pradesh, Sikkim and Mizoram; and, the bottom three performers are Manipur, Assam and Meghalaya.
- Among the 60:40 division States, Orissa, Chhattisgarh and Madhya Pradesh are the top three performers and Tamil Nadu, Telangana and Delhi appear as the bottom three performers.
- Among the 90:10 division States, the top three performers are Manipur, Arunachal Pradesh and Nagaland; and, the bottom three performers are Jammu and Kashmir, Uttarakhand and Himachal Pradesh
- Among the 60:40 division States, Goa, West Bengal and Delhi appear as the top three performers and Andhra Pradesh, Telangana and Bihar appear as the bottom three performers.
- Among the 90:10 division States, Mizoram, Himachal Pradesh and Tripura were the top three performers and Jammu & Kashmir, Nagaland and Arunachal Pradesh were the bottom three performers
- West Bengal, Bihar and Tamil Nadu were the top three States amongst the 60:40 division States; while Haryana, Punjab and Rajasthan appeared as the bottom three performers
- In the case of 90:10 division States, Mizoram, Assam and Tripura were the top three performers and Nagaland, Jammu & Kashmir and Uttarakhand featured as the bottom three
- Among the 60:40 division States, the top three performers are Kerala, Andhra Pradesh and Orissa and the bottom three performers are Madhya Pradesh, Jharkhand and Goa
- In the 90:10 division States, the top three performers are Mizoram, Sikkim and Nagaland and the bottom three performers are Manipur and Assam
In a diverse country like India, where each State is socially, culturally, economically, and politically distinct, measuring Governance becomes increasingly tricky. The Public Affairs Index (PAI 2021) is a scientifically rigorous, data-based framework that measures the quality of governance at the Sub-national level and ranks the States and Union Territories (UTs) of India on a Composite Index (CI).
States are classified into two categories – Large and Small – using population as the criteria.
In PAI 2021, PAC defined three significant pillars that embody Governance – Growth, Equity, and Sustainability. Each of the three Pillars is circumscribed by five governance praxis Themes.
The themes include – Voice and Accountability, Government Effectiveness, Rule of Law, Regulatory Quality and Control of Corruption.
At the bottom of the pyramid, 43 component indicators are mapped to 14 Sustainable Development Goals (SDGs) that are relevant to the States and UTs.
This forms the foundation of the conceptual framework of PAI 2021. The choice of the 43 indicators that go into the calculation of the CI were dictated by the objective of uncovering the complexity and multidimensional character of development governance
The Equity Principle
The Equity Pillar of the PAI 2021 Index analyses the inclusiveness impact at the Sub-national level in the country; inclusiveness in terms of the welfare of a society that depends primarily on establishing that all people feel that they have a say in the governance and are not excluded from the mainstream policy framework.
This requires all individuals and communities, but particularly the most vulnerable, to have an opportunity to improve or maintain their wellbeing. This chapter of PAI 2021 reflects the performance of States and UTs during the pandemic and questions the governance infrastructure in the country, analysing the effectiveness of schemes and the general livelihood of the people in terms of Equity.
Growth and its Discontents
Growth in its multidimensional form encompasses the essence of access to and the availability and optimal utilisation of resources. By resources, PAI 2021 refer to human resources, infrastructure and the budgetary allocations. Capacity building of an economy cannot take place if all the key players of growth do not drive development. The multiplier effects of better health care, improved educational outcomes, increased capital accumulation and lower unemployment levels contribute magnificently in the growth and development of the States.
The Pursuit Of Sustainability
The Sustainability Pillar analyses the access to and usage of resources that has an impact on environment, economy and humankind. The Pillar subsumes two themes and uses seven indicators to measure the effectiveness of government efforts with regards to Sustainability.
The Curious Case Of The Delta
The Delta Analysis presents the results on the State performance on year-on-year improvement. The rankings are measured as the Delta value over the last five to 10 years of data available for 12 Key Development Indicators (KDI). In PAI 2021, 12 indicators across the three Pillars of Equity (five indicators), Growth (five indicators) and Sustainability (two indicators). These KDIs are the outcome indicators crucial to assess Human Development. The Performance in the Delta Analysis is then compared to the Overall PAI 2021 Index.
Key Findings:-
In the Scheme of Things
The Scheme Analysis adds an additional dimension to ranking of the States on their governance. It attempts to complement the Governance Model by trying to understand the developmental activities undertaken by State Governments in the form of schemes. It also tries to understand whether better performance of States in schemes reflect in better governance.
The Centrally Sponsored schemes that were analysed are National Health Mission (NHM), Umbrella Integrated Child Development Services scheme (ICDS), Mahatma Gandh National Rural Employment Guarantee Scheme (MGNREGS), Samagra Shiksha Abhiyan (SmSA) and MidDay Meal Scheme (MDMS).
National Health Mission (NHM)
INTEGRATED CHILD DEVELOPMENT SERVICES (ICDS)
MID- DAY MEAL SCHEME (MDMS)
SAMAGRA SHIKSHA ABHIYAN (SMSA)
MAHATMA GANDHI NATIONAL RURAL EMPLOYMENT GUARANTEE SCHEME (MGNREGS)