Hindu Nationalist RSS Leadership Criticizes Jobless Growth in India

Akhil Bharatiya Pratinidhi Sabha (ABPS), the top decision-making body of India's RSS (Rashtriya Swayamsevak Sangh), says that “the young generation is suffering from unemployment and the pandemic has made things even grim... We cannot turn a blind eye to unemployment. It is a crisis and it needs to be addressed.” The RSS was apparently reacting to the falling labor participation rate in India relative to Pakistan and the global averages. The RSS leadership wants the government of Prime Minister Narendra Modi to focus on helping small and medium sized enterprises (SMEs) to create jobs.  RSS likes Modi government's ‘Make in India’ initiative “but it needs to be sharpened even more and get more investment.” The resolution is titled, ‘The need to promote work opportunities to make Bharat self-reliant’. The solution offered by ABPS resolution: Take agro-based local initiatives to promote rural areas and create jobs, according to Ram Madhav, a member of the RSS executive committee. 

Falling Employment in India. Source: CMIE

India's labor participation rate (LPR) fell to 39.5% in March 2022, as reported by the Center for Monitoring Indian Economy (CMIE). It dropped below the 39.9% participation rate recorded in February. It is also lower than during the second wave of Covid-19 in April-June 2021. The lowest the labor participation rate had fallen to in the second wave was in June 2021 when it fell to 39.6%. The average LPR during April-June 2021 was 40%. March 2022, with no Covid-19 wave and with much lesser restrictions on mobility, has reported a worse LPR of 39.5%.

Labor Participation Rates in India and Pakistan. Source: ILO/World ...

Youth  unemployment for ages15-24 in India is 24.9%, the highest in South Asia region. It is 14.8% in Bangladesh 14.8% and 9.2% in Pakistan, according to the International Labor Organization and the World Bank.  

Youth Unemployment in Bangladesh, India and Pakistan. Source: ILO, WB

In spite of the headline GDP growth figures highlighted by the Indian and world media, the fact is that it has been jobless growth. The labor participation rate (LPR) in India has been falling for more than a decade. The LPR in India has been below Pakistan's for several years, according to the International Labor Organization (ILO). 

Indian Employment Trends By Sector. Source: CMIE Via Business Standard

Construction and manufacturing sectors in India have been shedding jobs while the number of people working in agriculture has been rising, according to CMIE. 

Pakistan Employment By Sectors. Source: PBS via Bilal Gilani

It is important to note that Pakistan’s economy has created 5.5 million jobs during the past three years – 1.84 million jobs a year, significantly higher than yearly average of new jobs created during the 2008-18 decade, according to the findings of Labor Force Survey (LFS) as reported by the Express Tribune paper. The biggest jump in share of employment (1.5%) was in the construction sector, spurred by Naya Pakistan construction incentives offered by the PTI government. 

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Comment by Riaz Haq on May 23, 2022 at 8:29am

Autonomous Hindutva could devour both India and the Bharatiya Janata Party
In a formally secular India, religion indeed seems to have become the opium of the people, a mass distraction from the transformative social agenda that the country needs

Last Updated at May 23, 2022 09:46 IST


Bharat Bhushan

https://www.business-standard.com/article/opinion/autonomous-hindtu...

With the rapid radicalisation of sections of Hindu society, the Hindutva project has become dangerously autonomous. It is no longer possible to see it only as an electoral strategy of the Bharatiya Janata Party (BJP). Today one does not need to even presume the direct hand of the BJP or the Rashtriya Swayamsevak Sangh behind Hindutva’s every move.

Its exponential social growth may have placed it beyond their control. In a formally secular India, religion indeed seems to have become the opium of the people. When Marx described religion as “the sigh of the oppressed ...

Comment by Riaz Haq on May 25, 2022 at 8:16am

Why is India's economy looking so bleak?

https://qz.com/india/2170008/why-is-indias-economy-looking-so-bleak/

https://vigourtimes.com/why-is-indias-economy-looking-so-bleak-quar...


There's an apocalyptic nature to the way things feel and look right now.

Overnight news of a crash and slide for the Dow and Nasdaq bring fears every morning of another stock market rout in India. The rupee is in completely new and scary territory now slip- sliding towards the 80-mark to the dollar. Crude has shown no inclination to ease back from the triple digits it now trades in.

All this is what grabs headlines and eyeballs. But to call a spade a spade, the stock market represents and holds only a minuscule fraction of India's population and investing community within it. It is undoubtedly called the barometer of sentiment but whose sentiment does it reflect and is it only now that things have turned bad?

Go back a few years to the red-letter demonetisation day on Nov. 8, 2016. On the face of it, both the country and the ruling Bharatiya Janata Party government emerged intact from a dangerous experiment. What went unnoticed—or certainly, unreported by mainstream media—was the devastation it wreaked on small and medium businesses. That devastation has turned into a slow but fatal grind, pulverising business after business.

What sucking out cash from the system did in 2016, was followed up by a patchwork rollout of the Goods and Services Tax in 2017. More pressure. The final nail in the coffin has been the insidious rise and rise of inflation. In April this year, inflation at the retail level surged to an eight-year high of 7.79%. The wholesale price index hit a record high of 15.1%, the outcome of rising prices of vegetables, fruits, milk, manufacturing, fuel, and power.

Lest we begin to blame it all on the war in Ukraine, inflation has remained in double digits for 13 months in a row now. A red flag that was waving in the air for many months, and now seems to have the Reserve Bank of India's full attention.

Biting the bullet

Large businesses have responded. Consumer goods companies have decided to bite the cost bullet. Prices of goods have been…


-------------


Key lessons
But it leaves important lessons to think about. What did I learn from this, was I truly looking at investing when I picked up the small cap stock? Do I know enough to be trading in the futures and options market, sharp as a knife and fast as a bullet? A young India that was bedazzled by the cryptocurrency market will also have to collect its broken earnings and dreams. India has been one of the world’s fastest-growing cryptocurrency markets, increasing by 641% between July 2020 and June 2021. Much of that was India’s young population, from the B and C cities. In the crash burn we have seen this year, many young traders have been left singed.

The ultimate lesson, I believe, is this. When there is a cancer in the system, it will spread. For all those who believed the market, or one segment of the economy, would continue to grow even as the broader market and population was crumbling under the pressure of the last few years, it has not worked that way.

Comment by Riaz Haq on May 25, 2022 at 10:09am

Why is India's economy looking so bleak?

https://qz.com/india/2170008/why-is-indias-economy-looking-so-bleak/

https://vigourtimes.com/why-is-indias-economy-looking-so-bleak-quar...


Biting the bullet
Large businesses have responded. Consumer goods companies have decided to bite the cost bullet. Prices of goods have been increased, package sizes will get smaller, and downtrading—switching from expensive products to cheaper alternatives—is the new reality for daily household purchases. The construction of homes will get more expensive as the prices of cement, transportation, materials all climb higher.

Do small businesses have the same luxury and leeway? Not really. In an interview to the Business Standard, Jitubhai Vakharia, the president of the South Gujarat Textile Processors’ Association in Surat, explained how the input cost of coal has almost doubled. The cost of dyes and chemicals have increased by 25% to 40% and the price of some chemicals like sodium hydrosulphite of soda or discharging agent like safolite have increased by 140% to 150%. Input costs have increased he says.

So can they raise costs? Increasing prices is difficult he admitted, as demand is already low in the market.

What that means is, more business could be forced to close, more jobs are lost, and more households are left wondering how they will get by. The government’s own data shows that 5,907 businesses registered as micro, small, and medium enterprises were shut during financial years 2020-’21 and 2021-’22. In the 2021 financial year, 330 MSMEs were shut down.

It is perhaps with an eye to this simmering discontent around price rise and seeing the neighbouring country of Sri Lanka quite literally go up in flames over spiralling inflation, that finance minister Nirmala Sitharaman announced on Saturday an excise cut in petrol and diesel taxes and a 200 rupees ($2.58) subsidy for those buying cooking gas cylinders, along with some customs duty cuts. While the move is being criticised as an optical illusion, the Narendra Modi government has clearly sensed dissatisfaction around the way costs have risen and moved to do some damage control.

The latest State of Inequality in India Report by the economic advisory council to the prime minister had these observations to share. The income of the top 1% shows a growing trend, while that of the bottom 10% is shrinking—the top 1% of income earners in India cumulatively earn more than three times of what is earned by the bottom 10%. Within that, a person who earns an average of Rs25,000 per month is now part of the top 10% of the total wages earned bracket. What does that mean for the others, what are people earning and how are they getting by in an environment of continuous cost rise?

This economic strife also begets the question, why doesn’t it translate into protests, electoral punishment? Why aren’t people voting out governments when they feel the pressure of rising costs, no jobs, and less and less ability to spend?

Comment by Riaz Haq on May 25, 2022 at 10:11am

Why is India's economy looking so bleak?

https://qz.com/india/2170008/why-is-indias-economy-looking-so-bleak/

https://vigourtimes.com/why-is-indias-economy-looking-so-bleak-quar...

This economic strife also begets the question, why doesn’t it translate into protests, electoral punishment? Why aren’t people voting out governments when they feel the pressure of rising costs, no jobs, and less and less ability to spend?

Difficult conditions
One, this does not have a singular unified impact. In the run-up to the Uttar Pradesh elections, many roving reporters thrust their mikes into the faces of people. What do you worry about, what is a concern, they were asked? “Mehengai,” the rising cost of living, the interviewees would respond. Prices of cooking oils like mustard oil and sunflower oil had risen, gas cylinder prices were up, jobs were scarce and running a household was an uphill struggle. India’s overall unemployment rate rose to 7.83% in April, up from 7.6% in March.

Yet, it did not impact voting choices and the ruling state government was elected back with a clear majority. It is because my inflation is not your inflation. My household cost pressures are not yours. I have a job, but you don’t. Cost rise is too fluid and wide a challenge to cement together an entire population into making a political choice borne of it.

There is also the insulation that welfare schemes have created for the very poor. Food schemes, cash transfers, and some workdays through the Mahatma Gandhi National Rural Employment Guarantee, which assures rural families of 100 days of work a year. The slice left vulnerable and besieged is India’s large and diverse middle class that is now feeling the pain. Households that own a motorcycle and dream of a small car, households that want to move from their one-bedroom rented accommodation, to a two-bedroom home of their own.

The rise of political marketing
Two, we now have a changed polity. With close to 500 million users, India has the most WhatsApp users. All of whom have been nursed with consistent messaging around political agenda. If the last 10 years have seen economic missteps, they have equally been marked by the rise of marketing in politics. More than Rs6,500 crore was spent on elections by 18 political parties between 2015 and 2020. Of this, political parties spent more than Rs3,400 crore or 52.3% on publicity alone.

The Bharatiya Janata Party spent 56% (over Rs3,600 crore) of the total election outlay by all 18 parties in the five years and Congress spent 21.41% (over Rs1,400 crore). In the last five years, the BJP has spent 54.87% (over Rs2,000 crore) of their total election expenditure on “advertisements and publicity” compared to 7.2% (Rs260 crore) on marches, rallies, and other campaigns. The Congress, in the five-year period, has spent 40.08% (Rs 560 crore) of the total election expenditure on election-related publicity.

Does all this matter? Higher public expenditure on publicity and advertising in an election year is a major factor for a state government to retain power, In a May 2021 State Bank of India report titled “State Elections: How Women are Shaping India’s Destiny,” Soumya Kanti Ghosh. the Group Chief Economic Adviser, writes that in most of the states, on an average in order to be re-elected, incumbent governments make huge spends in an election year.

Comment by Riaz Haq on May 25, 2022 at 10:12am

Why is India's economy looking so bleak?

https://qz.com/india/2170008/why-is-indias-economy-looking-so-bleak/

https://vigourtimes.com/why-is-indias-economy-looking-so-bleak-quar...

Does all this matter? Higher public expenditure on publicity and advertising in an election year is a major factor for a state government to retain power, In a May 2021 State Bank of India report titled “State Elections: How Women are Shaping India’s Destiny,” Soumya Kanti Ghosh. the Group Chief Economic Adviser, writes that in most of the states, on an average in order to be re-elected, incumbent governments make huge spends in an election year.


In a few states where publicity expenditure was low in election year, the incumbent government mostly lost the election. It may be fair to say then that this marketing blitz can mould voter opinion, whether it is to highlight the benefits of a regime—or to demonise a section of the population.

What does all this have to do with the stock market that’s battling its own losses and the fear of a prolonged bear trading patch? It is an ugly situation for markets, there’s no denying. Selling in the equity universe will come in waves and lashes, this purging of stocks, prices, and holdings. However, this too shall pass. It may leave the markets in a dull trading range for many months where things move neither higher nor lower. Or it may bounce back faster than expected, egged on by better global news and the return of the prodigal foreign institutional investors.

Key lessons
But it leaves important lessons to think about. What did I learn from this, was I truly looking at investing when I picked up the small cap stock? Do I know enough to be trading in the futures and options market, sharp as a knife and fast as a bullet? A young India that was bedazzled by the cryptocurrency market will also have to collect its broken earnings and dreams. India has been one of the world’s fastest-growing cryptocurrency markets, increasing by 641% between July 2020 and June 2021. Much of that was India’s young population, from the B and C cities. In the crash burn we have seen this year, many young traders have been left singed.

The ultimate lesson, I believe, is this. When there is a cancer in the system, it will spread. For all those who believed the market, or one segment of the economy, would continue to grow even as the broader market and population was crumbling under the pressure of the last few years, it has not worked that way.

It is also true that we still remain a nation of great potential, a large working force, a diverse geography, a huge market size. But will India continue to walk into the future with only a rich few, or will we take all our people with us? As James Baldwin wrote, “Neither love nor terror makes one blind; indifference makes one blind.”

This article first appeared on Scroll.in. We welcome your comments at ideas.india@qz.com.

Comment by Riaz Haq on May 25, 2022 at 10:30am

As the wealthy converge on Davos to discuss the world’s problems, a case for taxing the rich

Harsh Mander and Prabhat Patnaik discuss funding universal social and economic rights, not just a universal basic income, in a time of widening inequalities.

https://scroll.in/article/1024582/as-the-wealthy-converge-on-davos-...


For instance, you look at per capita food intake. The proportion of people [consuming] below 2,200 calories per day in rural India, which is supposed to be the benchmark for poverty, in 1993-’94 was about 58%. You look at 2011, it was 68%. In urban India, corresponding, it was 57% and 65%.


What has happened now is that education and healthcare are much more expensive, none of which gets captured in the consumer price index. As a result, people are forced to spend so much on these that they actually skimp on buying food.


-------

Mander: I was struck by the latest World Development Report. It is perhaps the first major admission by the Bretton Woods set of institutions [World Bank and International Monetary Fund] that we may not be able to produce jobs, that jobless growth is actually not an aberration, but is almost written into the nature of [the] neoliberal model. But the solution that they want to give is universal basic income.

Prabhat Patnaik: Exactly. However, suppose everybody gets a certain amount of money, but with no school or government hospital within their radius. In that case, the idea of simply handing you money just does not help. It is very important that actual essential services and commodities must be made available to everybody, including work opportunities. And this is what the welfare state actually promised you.

Harsh Mander: Suppose I have a child with disabilities, I have many more economic needs than someone who does not. So a basic income and top-up idea is also blind to those questions.

My next question is with the conversation about universal social rights, which rights are we speaking about?

Prabhat Patnaik: Well, you can think in terms of a very wide range of rights. In my writings, I have essentially been talking about five economic rights. But I am not sticking to just those five, and neither am I saying that these five should take priority over other kinds of rights.

Harsh Mander: And these five are: employment, healthcare, school education, pensions, and food and nutrition.

Prabhat Patnaik: That’s right. So I am talking about just these five because I made some calculations based on them.

Mander: Just looking at the politics in India today, I think we are passing through such a difficult moment. There was a cartoon I saw the other day where there is a curfew outside and a man trapped inside. He is begging to get out. He is the economic crisis. Today, we see a different face of the economic crisis. A crisis in which if I do not have work or all my social rights, at least I am becoming a part of a “powerful Hindu nation”.

Elsewhere in the world, we are seeing the rise of political leaders very similar to the one we have elected. So, do you even feel that the conversations around universal social rights are going to emerge?

Patnaik: I think the Hindu Right has hijacked the political discourse. In some sense, we have to recapture the political discourse around the question of the improvement of the economy and the living of the people.

Mander: This has been a fascinating discussion. But the last question I have for you is about the critique on the idea of utopia since it is not feasible and we don’t have the money. As an economist, you have done your calculations. Obviously, we will have to reorganise how we spend the existing public resources. But how would we be actually able to raise the kind of resources that we require for the idea of universal social rights, even if we stay with just the five you spoke about?

Comment by Riaz Haq on May 27, 2022 at 7:46am

Modi Govt @ 8
SUBHASH CHANDRA GARG

https://www.moneycontrol.com/news/opinion/modi-govt-8-indian-econom...


‘Sabka saath, sabka vikas’ defined and operationalised an ambitious, universal, and effective redistribution agenda.

The PM Awas Yojana for housing, Saubhagya for electricity, Ujjwala for LPG connections, Swachh Bharat Abhiyan for toilets, and Ayushman Bharat for medical insurance reached out to all without critical basic facilities, and delivered benefits without discrimination.

The universal Aadhaar identity, and widespread use of fintech for direct benefit transfers, made delivery of benefits efficient, and eliminated corruption.

The adoption of ambitious renewable energy goals — first 175 GW by 2022, and then 450 GW of by 2030 — offered hope of saving India from pollution, and controlling carbon emissions.

Despite some unnecessary convulsions such as demonetisation, India’s economic management was indeed stellar in Modi’s first term.

Wobbly Second Term

Come the second term of the BJP-led NDA government, starting 2019, and the economic performance is facing headwinds.

Imposition of the most stringent and unimaginative lockdown in March 2020 was a disastrous self-goal. Scars of that lockdown are still visible. Consumer demand and value added in sectors such as construction and services have still not returned to pre-COVID-19 levels.

The government’s privatisation programme has floundered. Privatisation of two banks announced in the Budget 2021 has not seen any tangible progress. The Bill to amend the bank nationalisation law is nowhere in sight. The privatisation of BPCL is off the table. Privatisation of CONCOR, Shipping Corporation, IDBI Bank, a general insurance company etc. are all stuck. Privatisation transactions of Pawan Hans and CEL have been stopped after announcing acceptance of bids.

Monetisation in the railways, pipelines, and the power sector is stalled. The government is wrongly branding coal and gas block allocations as monetisation of assets.

It is expanding instead of downsizing. Many new ministries and departments have been created; while none closed or downsized. This government is on the defensive. It had to backtrack on agriculture reforms. Consolidated labour laws, despite having been enacted more than 20 months earlier, are in cold storage.

Import duties on cells and modules, key ingredients for executing the renewable energy agenda, have been raised putting the renewable energy programme in jeopardy. Delhi continues to be a pollution nightmare in winters.

In The $10 Trillion Dream, I have called India’s economic performance “the worst first three years of any Government”.

The Way Ahead

India is in a state of policy stasis.

The economic populism of Aatmanirbhar Bharat has dragged India into a quagmire. Tariffs were raised and imports banned in the name of Aatmanirbhar Bharat. India’s imports and trade deficit, however, have risen massively. Foreign portfolio investors have withdrawn their investments in droves.

The government’s policy to control inflation is wobbly and jerky. It is raising export duties, and reducing import duties. After steel, others will likely follow. The government has banned the export of wheat despite India carrying large surplus stocks.

The government is now running one of the largest fiscal deficits in India’s history. Wholesale inflation is at its worst in 30 years. Consumer inflation is well above tolerable limits, and is likely to stay there for many months. India’s foreign exchange reserves are dwindling.

It seems quite likely that remaining two years of the Narendra Modi government will be low growth and high inflation years. Even if one assumes growth of 7 percent a year, India’s GDP would grow at about 3.5 percent a year in Modi’s second five-year term. It will be the lowest growth performance of any government in many decades.

Comment by Riaz Haq on May 29, 2022 at 7:15am

Elon Musk won't manufacture Tesla cars in India because government prohibits selling and servicing of EVs
Indian leaders have made multiple failed appeals for Musk to bring Tesla to India

https://www.foxbusiness.com/economy/elon-musk-manufacture-tesla-car...


Tesla CEO Elon Musk said the company will not manufacture cars in India if the country does not allow it to sell and service its electric vehicles.

When asked by a Twitter user Friday if Tesla would be manufacturing a plant in India in the future, Musk said the move cannot happen under the country's current rules.

"Tesla will not put a manufacturing plant in any location where we are not allowed first to sell & service cars," Musk tweeted.

The team Musk hired in India last year has since been instructed to focus on the Middle East and the larger Asia-Pacific markets.


Musk's comments come as the Indian government has yet to accept his demand to reduce import duties on Tesla cars.

Indian leaders have made multiple failed appeals for Musk to bring Tesla to India.

"Our request to him is to come to India and manufacture here. We have no problems. The vendors are available, we offer all kinds of technology and because of that, Musk can reduce the cost," Road Transport and Highways Minister Nitin Gadkari said during the Raisina Dialogue 2022 conference last month, according to TribuneIndia.com.


"India is a huge market and offers good export opportunities too. Musk can export Tesla cars from India," he added.

Gadkari said in February that Musk must first manufacture in India before Tesla cars can be driven on the roads.

Musk had tweeted in January that he could not release Tesla vehicles in India yet due to "challenges with the government." And last summer, the billionaire posted to Twitter that he would like to launch Teslas in India, but the country's import duties are "the highest in the world by far of any large country."

India currently levies a 100% tax on imported vehicles costing more than $40,000, inclusive of insurance and shipping expenses. Cars that cost less than $40,000 face a 60% import tax.

Musk also said on Twitter Friday that SpaceX is waiting on approval from the Indian government to provide the company's Starlink satellite internet to the south Asian country.

Comment by Riaz Haq on May 29, 2022 at 5:13pm

CNN GPS with Fareed Zakaria May 15, 2022


https://transcripts.cnn.com/show/fzgps/date/2022-05-15/segment/01



ZAKARIA: Ian, I've got to ask you --

BREMMER: I'd want to jump in on that.

ZAKARIA: Yes. Do it quickly because I have got to ask you about China and Chinese economic growth, which seems veering, you know, very, very low because of the insistence on zero-COVID.

BREMMER: Absolutely true. The quick point I wanted to make is so much of the narrative we've heard from the developing world is, you know, you care about Ukraine because they are European, because they are White, 6 million refugees.

You didn't care about the Syrians. You don't care about Yemen or Afghanistan. The reality is this is a vastly more important conflict for the developing world because of the inter dependence of the global economy.

They should care more about Russia/Ukraine. They should be more invested precisely because this is going to hurt them in a way that Yemen and Syria and Afghanistan really didn't. And the world isn't there today. We have to spread that narrative.

But China, I mean, this is a huge problem. This is the second largest economy in the world and they were the most effective in responding to COVID once they admitted that COVID existed for the first year. They're the only ones that had growth. But they have stuck with it and they have stuck with the same exact zero-COVID policy when they don't have the vaccines, when they don't have the therapeutics. And now that's really causing more supply chain challenges on top of everything we've just been discussing.

And, by the way, this is fixable. The fact is that the single greatest excess commodity we have in the world right now -- it's not energy, it's not food, it's not fertilizer, it's mRNA vaccines for COVID. We can't get them in the arms of Africans because we don't have the infrastructure on the ground. The Chinese do but they refuse to accept international coordination and help because they're so angry at the way they were blamed. And they're so angry about the way that COVID has gone through the rest of the world while the Chinese locked it down. As a consequence we are all suffering. We can't coordinate on COVID.

ZAKARIA: Thoughts on China. You know, it's aiming for zero-COVID. It appears to be getting zero economic growth. I mean, that's an exaggeration but how bad is that?

BEDDOES (The Economist): I think it's pretty bad and I think it is clearly you cannot have zero-COVID. This is a strategy that in the long run cannot work. But unfortunately in a year where Xi Jinping wants to become the national party Congress later this year, effectively ruler for life, I think we're getting to the stage where no one dares tell him, no one dares say this is not going to work.

[10:45:10]

And if you mix that -- if you add to that -- the clamp-down on tech that he did in the last few months, I'm increasingly worried that China is moving towards sort of slightly erratic, autocratic culture, personal autocratic system of government. And so I'm deeply worried about China.

But just to end on a really good note and particularly to you, Fareed, I have just been in India. And I am much, much more upbeat in India.

ZAKARIA: You have an amazing cover story (in the Economist Magazine)

BEDDOES: Our cover story this week in India is they could blow it. You know, the Modi government could blow it but India has the ingredients both luck -- because of China's travails and because the world wants an alternative supplier. Because they benefited from their huge investment in digital tech, because a lot of things that are going right for them, I'm very, very upbeat on the potential for India. This year is going to be the fastest growing economy in the world and it could be the next 10 years if they play things right.

BREMMER: One hundred twenty degrees Fahrenheit in Delhi right now, Fareed. I don't know.

Comment by Riaz Haq on June 13, 2022 at 10:30am

India’s Economy Is Growing Quickly. Why Can’t It Produce Enough Jobs?
The disconnect is a result of India’s uneven growth, powered and enjoyed by the country’s upper strata.

By Emily Schmall and Sameer Yasir

https://www.nytimes.com/2022/06/13/business/economy/india-economy-j...

Among the job seekers despairing over the lack of opportunities is Sweety Sinha, who lives in Haryana, a northern state where unemployment was a staggering 34.5 percent in April.

As a child, Ms. Sinha liked to pretend to be a teacher, standing in front of her village classroom with fake eyeglasses and a wooden baton, to fellow students’ great amusement.

Her ambition came true years later when she got a job teaching math at a private school. But the coronavirus upended her dreams, as the Indian economy contracted 7.3 percent in the 2020-21 fiscal year. Within months of starting, she and several other teachers were laid off because so many students had dropped out.

Ms. Sinha, 30, is again in the market for a job. In November, she joined thousands of applicants vying for much-coveted work in the government. She has also traveled across Haryana seeking jobs, but turned them down because of the meager pay — less than $400 a month.

“Sometimes, during nights, I really get scared: What if I am not able to get anything?” she said. “All of my friends are suffering because of unemployment.”
---------

The struggles of working-class Indians, and the millions of unemployed, may eventually cause a drag on growth, economists say.
--------

NEW DELHI — On paper, India’s economy has had a banner year. Exports are at record highs. Profits of publicly traded companies have doubled. A vibrant middle class, built over the past few decades, is now shelling out so much on movie tickets, cars, real estate and vacations that economists call it post-pandemic “revenge spending.”

Yet even as India is projected to have the fastest growth of any major economy this year, the rosy headline figures do not reflect reality for hundreds of millions of Indians. The growth is still not translating into enough jobs for the waves of educated young people who enter the labor force each year. A far larger number of Indians eke out a living in the informal sector, and they have been battered in recent months by high inflation, especially in food prices.

The disconnect is a result of India’s uneven growth, which is powered by the voracious consumption of the country’s upper strata but whose benefits often do not extend beyond the urban middle class. The pandemic has magnified the divide, throwing tens of millions of Indians into extreme poverty while the number of Indian billionaires has surged, according to Oxfam.

The concentration of wealth is in part a product of the growth-at-all-costs ambitions of Prime Minister Narendra Modi, who promised when he was re-elected in 2019 to double the size of India’s economy by 2024, lifting the country into the $5 trillion-or-more club alongside the United States, China and Japan.

The government reported late last month that the economy had expanded 8.7 percent in the last year, to $3.3 trillion. But with domestic investment lackluster, and government hiring slowing, India has turned to subsidized fuel, food and housing for the poorest to address the widespread joblessness. Free grains now reach two-thirds of the country’s more than 1.3 billion people.

Those handouts, by some calculations, have pushed inequality in India to its lowest level in decades. Still, critics of the Indian government say that subsidies cannot be used forever to paper over inadequate job creation. This is especially true as tens of millions of Indians — new college graduates, farmers looking to leave the fields and women taking on work — are expected to seek to flood the nonfarm work force in the coming years.

“There is a historical disconnect in the Indian growth story, where growth essentially happens without a corresponding increase in employment,” said Mahesh Vyas, the chief executive of the Center for Monitoring Indian Economy, a data research firm.

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