Monday, October 14, 2013

Demographic Dividend in India - Asset or Liability

In recent times there has been a lot of noise from Indian Politicians as well as from some parts of the Media about the Indian Demographic dividend, speaking in glowing terms of how the huge young Indian population that would come to working age would be a big dividend for the Country.

Even though I may seem like a pessimist in terms of India's population becoming a dividend, here are the points mentioned below why I think there will be Challenges in terms of India's growing population leading to unrest and tension if sufficient opportunities are not provided to the youth.

1. Population Control- There seems to be very little effort by the Indian government in terms of population control, the people from the weaker sections of the society seem to have more children which is leading to increased poverty due to the fact that there are more mouths to feed and there is less money to invest for the children's education in good private schools. Most of the Indian Government school are of substandard quality. The fertility rate in the Northern states is still high while the southern states have stabilized. This could lead to a surplus of population without proper qualification.

2. Sex Ratio - The tendency among Indian families to abort female fetus and preference for the male child because of religious and cultural reasons has resulted in a high imbalance in the sex ratio in many states of India. This will result in many of the men not finding a wife as well as frustration among the men. This could lead to higher rates of violence and unrest. It could also lead to violence against women as well as spread of aids due to visit of sex workers.

3. Skill Development Initiative - The Indian government has taken a great initiative in terms of promoting skill development with the establishment of the National Skill Development council with the aim of skilling 500 million by 2022. This has resulted in many corporates establishing JV with the government but with no uniformity in curriculum and syllabus. Also, while the Government promotes Skill Development, it is not promoting FDI investment in the Skill Development Sector which could have lead to infusion of technology, more saving and more employment in sectors like Retails, Aviation, Defence, Agriculture etc.

4. Government Policies - While the government promotes skill development, certain government programs also discourage skill development initiatives, for instance the MNREGA, which is a rural employment grantee act. While in principle, the government is to pay for productive work for community labor by the rural people, what actually happens is that most of the work is being done with human labor and of not much  utility to the community. This leads to the community people being used to easy money without hardwork and without feeling a need for enhancement of skill.  Many of the populist schemes also leads to reduction in  Investment in crucial investment in road, power and other Infrastructure

5. Investment Policy -  It has been of great loss to the Indian economy that it has not been able to attract investment in the Manufacturing sector which could have provided the maximum number of employment to the people. Investment in the Private Sector by MNC would like to not only employment for the young people but also investment of technology in the economy which would bring down inflation rate and reduce wastage within the economy due to the scale of investment and technology that it would bring. China has been one country which has benefited from a good investment policy leading to a huge number of Factories and Industries, specially in Specially Economy Zones, giving it the nickname, the Factory of the World and also becoming the richest developing country in the world.  India can also join this bandwagon but promoting investment into the economy, it makes no sense promoting skill development without thinking of how to promote Business to invest in the country.

Being a person from Northeast India, firsthand, below are few cases which I have encountered in the city of Chennai because of lack of proper skill development leading to various other problems.

1. Stealing/ Theft - I once had the experience of being called to a Hospital with my friend one day, while having a Birthday party. While on the party, someone called us up telling us that someone from the Northeast community was seriously ill and that we should come and meet them.  When we reached the Hospital, we were beaten up the people whom we though were criminals but later found out were plain clothes police man who were investigating a case of theft where some of the Northeast guys who had been fired had been involved. Ultimately, the Police apologized to us due to the unfortunate event and sleeked our support in finding the culprit.  These youth who were involved in these petty thefts would not have been stealing had they had a better training in skill development with proper employment opportunities in organized sector.

2. Lost/ Mentally Ill - There have also been cases where some of the people who had come for employment had quit or been fired from their job and were depressed, took to drugs or were found in mental Asylums. With many of these people employed in the unorganized sector, these youth get exploited, they are made to work overtime and not paid what they are promised because they do not have proper skills with proper certification. Had these people had good opportunities though better skills, they could have had better opportunities.

3. Trafficking- There has been a recent boom in the Indian metros of Spa's and massage parlours, while not all of them are involved in illegitimate activities, many young unskilled northeastern girls are being trafficked into the metros with promise of employment opportunities but are forced into sexual activities. To curb this activities, many of these young northeast women could have been trained in soft skill and given employment opportunity in Healthcare, Hospitality or Retail.

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