Unemployment Crisis: Why Modi Govt Hasn’t Delivered On its Promise

The govt shouldn’t allow India to go from being one of the largest growing economies, to one with no jobs.

5 min read
The govt shouldn’t allow India to go from being one of the largest growing economies, to one with no jobs.

India is at an interesting cross-roads today. On one hand the global growth forecast for 2019 has weakened, and on the other hand, emerging market economies like India are poised to be among the fastest growing large economies over the next two years. What categorises our ambitious nation is that we are young. And, the count of graduates entering the job market is rising with every passing year. However, young Indians face an inevitable challenge – jobs. This accentuates the fact the modern India is still a land of paradoxes.


Recently, we witnessed the breakdown of another institution in India. Members and the Chairperson of the National Statistical Commission resigned from their posts citing the government’s interference in the release of NSSO survey data on employment . This makes one think that how much can the ground realities change by shelving data or by employing different benchmarks?

The key issue of the BJP’s manifesto in 2014 was jobs. Modi promised to create 2 crore new jobs every year, in multiple election rallies. This led to a landslide victory for BJP and obviously great expectations of performance by the people.

Almost 4.75 years later, if a report card was made for the Modi government, it would mostly reflect a poor grade with respect to creating employment.

The Truth About Employment

On the Maratha reservation bid in Maharashtra, Union Minister Nitin Gadkari had said, “even if reservations were granted, there are no jobs in the country.” And upon being asked about employment, Prime Minister Modi believed that opening a pakoda shop would qualify as employment.

A lack of compr­­ehensive policies was glaring when the Centre for Monitoring Indian Economy released its report in January 2019, which revealed that unemployment was at its highest in 27 months in December 2018, at 7.38 percent, and 11 million Indians lost their jobs in 2018 alone.

The quest for good jobs, which was flared through the Patel agitation, Maratha agitation, Jat reservation stir and others, was further aggravated through the aftermaths of policy decisions like demonetisation and GST, which led to a loss of 3.5 million jobs since 2014. Aftershocks were apparent when 25 million people applied for 90,000 railway jobs or when PhD holders applied for the position of a peon in Uttar Pradesh. All these instances underline how the situation of employment and jobs for the common man is in dire straits. What this also shows us is that India might not be making the most of its demographic dividend – one of its most prized assets.


Jobs Promised vs Jobs Delivered

In order to create a multiplier effect, the current administration has tried to bring in foreign investors through various investor summits. However, the outcome has not been as favourable as expected. Of the MoU’s signed in the renewable energy sector alone by the Gujarat government in all of the Vibrant Gujarat Global Summits till date, only 7.35 percent of the promised investments have been delivered till date.

This means, in comparison to 1.92 lakh jobs that were promised, only 12,343 jobs have been created. Furthermore, the pre-election half-baked job hand-outs by means of a 10 percent reservation to the economically weak sections of the general category seems to be done to ensure the optics are good before the big fight.

Though our economy has been redesigned over the past four years, our jobs haven’t. Furthermore, behavioural factors are driving people to strive for government jobs at a time when the Indian government is aiming to raise USD 11.21 billion in FY20 through the sale of state-owned assets. Given our demographic structure, we need to develop a mechanism to create jobs, across spectrums. Jobs which one can adapt to, given the skill-sets of the current masses and also ones that are sustainable in the long-run.


Poor Implementation of ‘Skill India’, ‘Make In India’

In addition to providing tax incentives to the hinterlands of Kashmir and the north-eastern states, we need to focus on sustainable job creation in these hubs. This will make the policymakers embrace the long due labour reforms in order to reach this feat. However, the key method to tackle this problem is at its root. Given the fourth industrial revolution is driven by new skills, the Indian youth will need to rewire their skill-sets regularly, and India will slowly need to move towards a research-based university system that supports innovation and industry collaboration, in order to provide for a steep learning curve.

There also exists another side to this tale. Successive governments have been unable to fill the 24 lakh vacancies in government jobs, on the contrary it has further slashed these jobs. This has led to frustration among the educated youth, and can be considered a disservice to the institutions which are not functioning at full capacity.

Ambitious initiatives such as ‘Make in India’ and ‘Skill India’ started off with rosy promises of jobs and respect for everything Indian, but quarterly growth rates of Gross Value Addition(GVA) point us in the opposite direction, to a waning initiative. Even if these policies sound path-breaking on paper, their implementation has been disappointing because the complementary infrastructural upgrade has been snail-paced. These disappointing figures are bound to have a negative social impact which are mirrored in increased strikes, violence, crime, poverty and debt.


Wake Up Call for The Govt

With only a few months to go for general elections, there is very little the current government can do to cause a volte face of the economy. This government and the next must focus on employment generation, before one of the fastest growing economy also houses one of the largest number of unemployed. Small-scale businesses must be given the much deserved push especially in the rural areas. Better budget allocations are required to fill the existing vacancies in the government jobs. India’s deadwood policies need to be revamped to meet new horizons of economic growth and development.

Prime Minister Modi observed that we are an ancient civilisation with a young population, therefore short-term fixes will not work. Furthermore we should note that the Indian youth is no longer looking for anyone to sling hope over the radio. Rather, it is looking for instrumental changes that might correct the course of the great Indian job crisis.

(Rudrali Patil is pursuing an LLM at The Fletcher School of Law and Diplomacy, USA. She tweets at @rudralipatil. Shahan Sud is an investment banker. This is a personal blog and the views expressed are the authorsown. The Quint neither endorses nor is responsible for them.)

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