India cannot become developed economy without tapping unemployment: Economist
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India's vision of transforming into a developed economy by 2047, marking the nation's centenary of independence, may remain a distant aspiration without significant reforms aimed at boosting employment, warns a senior official from the World Bank.
Prime Minister Narendra Modi has frequently underscored this goal, urging citizens to strive towards making India a developed nation by its centenary. However, Franziska Ohnsorge, the World Bank's chief economist for South Asia, highlights that achieving this target would be challenging without substantial reforms.
In a recent report titled "Jobs for Resilience," the World Bank pointed out India's sluggish employment growth in comparison to other emerging markets and developing economies during the 2010s. The report notes a concerning decline in the employment ratio, indicating a mismatch between workforce expansion and job creation.
Ohnsorge describes this situation as a "missed opportunity," emphasizing the underutilization of India's demographic dividend. This demographic advantage, stemming from a larger working-age population, is crucial for driving economic growth.
Alarmingly, recent reports by the International Labour Organisation and the Institute of Human Development highlight a significant proportion of unemployed youth in India, with nearly 83% of the unemployed falling within this demographic. Moreover, unemployment among educated youth has intensified over time, underscoring the urgency for effective employment strategies.
The United Nations projects a considerable increase in India's elderly population by 2050, signalling a narrowing window to capitalize on the demographic dividend. However, demographic experts stress that timely interventions addressing unemployment, skill shortages, and healthcare deficiencies are imperative to harness the potential of India's youthful population.
India's Chief Economic Advisor, V Anantha Nageswaran, echoes these sentiments, emphasizing the need to prioritize skill development, particularly in areas such as green technology and artificial intelligence, to leverage the demographic dividend effectively.
Addressing these challenges requires a multifaceted approach encompassing policy reforms, investment in education and healthcare, and fostering innovation and entrepreneurship. Enhancing vocational training programs, promoting job creation in emerging sectors, and improving access to quality education and healthcare services are vital steps towards realizing India's economic aspirations.