‘Dream is not that you see in sleep, dream is something that does not let you sleep’ – late APJ Abdul Kalam.
Sitting on the backseat of the taxi, I watched the man in front of me conquering the busy and sweaty streets of Mumbai with sheer strength and determination. This taxi driver, a PHD student, reminded me of millions of Indians who have a dream for themselves and their country. The average Indian’s hope is to look for a better quality of life, freedom to make personal choices and a certain amount of security. Amidst his education background, this man showcased how to lift the game of life without fear and prejudice. Such a character not only portrays conviction but also delivers more value to the market economy.
The youth herald tremendous economic opportunities. As per latest figures, more than 600 million, nearly half of the entire India population, are under the age of 25. Many in this troop aspire to have an American dream. For India to benefit from this demographic dividend, it needs to create the enabling environment for economic growth. ‘Skill India’ is a major policy initiative in the right direction. It is both comprehensive as well as national in character. The skill development initiatives would provide opportunities for young Indians to achieve higher productivity. By matching demand of the economy to the supply of the market, this initiative may help to direct this huge demographics into productive employability.
Through the years, job creation has only taken place in IT/BPO sector. Labour intensive industries like manufacturing have failed to absorb the unemployed. The latest poor Indian industrial growth (IIP shrank 0.8% in April) is evidenced that the manufacturing sector has remained a laggard. Indian government is making rigorous efforts to attract foreign investments in manufacturing sector through the ‘Make in India’ campaign. This fundamental change in the core of the Indian economy will ensure that youngsters are employed in productive ventures. Being employed imply that there is improvement in the economic situation of even the poorest family. It is anticipated that this segment would then move towards the middle class thus improving their purchasing power. This will lead to growth in the market economy. The results of this progressive initiatives is yet to bear fruits but the path is being set for sparkling growth. To reboot the manufacturing sector, policymakers in India need to prioritise structural reforms aim at enhancing market competition, innovation and dynamism.
The foundation of any country, the hub containing the knobs that manipulate the economy and society, is the government. The kind of people who sit in the hub have a huge impact on the destiny of any country. For the first time, a stable government with a strong leader is moving India towards a position of strength. In this unstable world economy, India is viewed as a preferred and stable market. Unlike, previous years, India has a more stable macro-economic position with low Current Account Deficit (CAD less than 2%in FY 16) and improving fiscal and inflation (May 5.6%) dynamics. Many progressive economic policies and structural reforms are being implemented for sparkling growth.
At the time of writing, United Kingdom has opted out of Europe. No doubt in the near term, Brexit will weigh on global growth. Britain may plunge into a recession as trade would suffer due to re-negotiation of multiple agreements. In this low growth environment, India may eventually stand out. India’s lower external orientation with 60%+ of growth being domestic consumption driven will stand out in a growth starved world. Importantly, India will be a beneficiary of lower commodity prices and may help rein low inflation. The recent opening of foreign investment in key sectors of the economy together with progress on Good and Services Tax (GST), ring-fencing of domestic banks, improving the supply side and reviving domestic projects, will add to India’s allure for investors.
In order to boost productivity, India has to optimize on its huge human resources. By elevating the experience of its young workforce into productive ventures, India is poised to stand out from other emerging markets and may as well surpass developed countries. What is required is radical change in governance and mind set. Investment must be geared on productive assets that boost productivity.
This year India will celebrate its 69th independence. It needs people of courage and conviction to lift the country into economic bliss.