Events
& Issues
New Delhi, 23 October 2019
Economic Mess
ALARM FOR MASSES & JOB SEEKERS
By Dhurjati Mukherjee
Economic slowdown in
India and uniform acceptance that future is not quite bright is under sharp
focus. It gets reinforced by IMF chief’s observation that in emerging
economies, specially India and Brazil, the slowdown would be more pronounced
and projections for the current fiscal further downgraded. Obviously, it all
sounds quite disturbing for the masses as well as for the new generation, which
is entering the work force.
Even Prof. Abhijit
Banerjee, the Nobel Laureate in economics this year, has spoken of India’s
economic mess, starting with demonetisation and a hurriedly launched GST. There
is near unanimity about the way the economy has been handled, benefitting the
business class as also the middle income sections. While something has been
done for public sector banks, the PSUs have been handled in an unprofessional
manner and jobs in this sector have been diverted to the private sector.
The resultant effect
has been that the employment scenario has been very poor for over a year. But
while experts are giving suggestions regarding revival of the economy, there is
no concrete proposal how and when employment prospects would improve. Recently
at an informal conclave of some non-traditional economists, where the
undersigned was also present, it was pointed out that there is no scope of
employment prospect increasing if the current economic policies and programmes
continue in the years ahead. In fact, the situation may become quite serious and
shall have grave consequences for a country like India with a huge labour
force.
Meanwhile, RBI’s
monthly Consumer Confidence Survey for September revealed deep pessimism about
the employment situation among Indian households. A majority of respondents --
around 53% felt the job situation had worsened. Similarly, around 48% of the
households felt that the economic situation worsened, though the figures would
have been higher if the survey had covered rural areas, specially the backwards
districts.
At the same time, the
Periodic Labour Force Survey (PLFS) of the National Sample Survey Office (NSSO)
reported that in 2018, the overall unemployment rate was 6.1 per cent with
rural being 5.3% and urban 7.8%. This must have increased by around 1% with the
rural figures much below the actual. This is justified by the fact that the
potential non-agricultural workforce grew at the rate of 14.2 million a year
between 2005 and 2012 which rose further to 17.5 million a year between 2012
and 2018.
The biggest challenge
before the country is not in satisfying the needs and demands of the middle
income sections and, of course, of the upper echelons of society but in
ensuring better livelihood facilities for the rural poor. Unfortunately, in
spite of various plans and programmes, this is not reaching the impoverished
sections and the backward communities.
The fact that India
has been ranked 102nd on the Global Hunger Index among 117 countries, the
lowest ranked South Asian country and way behind BRICS nations, is a testimony
to the glaring fact that the country’s planning and development policies are
faulty and lopsided. India’s rank slipped from 93 in 2015 and even Pakistan,
which used to be the only country in South Asia to rank below India, has pulled
ahead in the 2019 ranking to 94th place. This suggests that over the years social
infrastructure development has been neglected, which, in turn, talks a lot
about rural transformation and creating employment avenues.
The huge dependence
on agriculture is due to the fact that non-agricultural avenues have not grown
as these did not receive sufficient support as did big business. With finance
being a problem area, self-employment didn’t grow. An additional problem area
was entrepreneurs and workers with requisite skill not getting adequate
intention, which is being addressed only now.
The present
government, in its quest to help and support a few big private companies, has
not given sufficient attention and encouragement to PSUs to help expand and
modernise. A professor of telecommunication engineering and a few common
friends questioned the fact that while BSNL provide towers to all companies,
how is it that the private operators, who are using these towers, are making
profits whereas the former is mired in losses?
If the government
wants to hand over everything to the private sector the possibility of
employment generation would decrease year by year. It is known the private
sector is only interested in profits and results of a survey on corporate
social responsibility reveal that most companies are not adhering to it as
mandated. Worse, under pressure from business houses, the penalty clause for
defaulters was withdrawn at the last stage. If this is state of affairs, can we
then believe that public-private participation or even ‘Make in India’ by the
private sector will actually throw up adequate job opportunities?
As is well known, capacity
utilisation is just around 73% and the private sector will not invest, as is
generally being laid out after the government reduced corporate taxes. Instead,
it would have been better if the government had forced the big corporates to
take up at least one village for upgrading facilities, specially in areas of
education and health. But the government has put up a false hope that
investment opportunities would be geared up if corporate taxes are reduced.
Over the years, the politician-business nexus has possibly been the result of
such sorry state of affairs, i.e. imbalanced development and mass suffering.
The nature of
capitalist development that we are following will neither result in job
creation nor will it address the poor conditions of the rural folk. I would say
more than renowned economist Prof. Amartya Sen, it was Prof. Amlan Dutta, who
laid the foundations of a different developmental approach, which could be
termed ‘people centric’. Being a hard-core Gandhian thinker, he envisaged a
decentralised form of governance with more power and authority to the
panchayats, which has not fructified till now as envisaged. Moreover, he wanted
planning to be rural-centric -- focus on problems of villages and their needs
and necessities.
Even our late
President APJ Abdul Kalam had promoted the concept of PURA (providing urban
facilities in rural areas) to strengthen rural economy and provide jobs so that
migration is curbed. Very recently Abhijit Banerjee had conceptualised
Congress’s unique NYAY scheme that aimed at improving financial condition of 20%
of India’s poorest families and this was drawn from experience of countries
like Indonesia and Brazil.
The actual change in
planning strategy and developmental approach is yet to become a reality as the larger
interest of capitalists and political leaders continues to get top priority.
This invariably goes against the interests of the masses, specially in rural
and backward areas. Unless a pro-rural, inclusive and labour-oriented approach
is adopted, which is unlikely in actual terms by the present government,
inclusive development will remain a myth and employment generation shall
steadily decline. A reality check rather than tall claims is needed. ---INFA
(Copyright, India
News & Feature Alliance)
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