The Hindu

Opinion Comment
Published: August 15, 2014 01:11 IST | Updated: August 15, 2014 11:36 IST
Young and jobless in India
Charan Singh
INSIGHT: The reason for unemployment could be the lack of employment because of the quality of education or lack of opportunities.
Picture shows young workers returning home after sorting coal in Gonda district, Uttar Pradesh. Photo: R.V. Moorthy
India must devise a demographic policy to separately meet the requirements of the young, middle-aged and elderly
The Census data released recently show that unemployment in the country, especially among the youth, is very high,
averaging nearly 20 per cent for the age group of 15-24 years. In some States like Chhattisgarh, Madhya Pradesh, West
Bengal, Rajasthan, Himachal Pradesh and Jammu and Kashmir, the unemployment rate is above 25 per cent.
Prosperous States like Punjab, Haryana, Gujarat and Maharashtra have averages that are less than half of the national
average. Demographic dividend in the country is not being appropriately used and there is a need to revisit the
demographic policy so as to tap benefits from the youth.
Devising a demographic policy
There is also a larger issue of devising a demographic policy to separately meet the requirements of the young, middle-
aged and older segment of the population. The reason for unemployment could be the lack of employment because of
the quality of education or lack of opportunities. India has more than 71,000 pre-degree colleges and senior secondary
schools, 25,938 colleges for professional educational and 436 universities. These are in addition to the nearly 14 lakh
schools in the country for a population of 25 crore children in the age group of 5-14 years. Hence, given the number of
educational institutions, there is a need to improve the quality of education by ushering in competition, by probably
inviting foreign universities to set up campuses in India.
Employment creation is a function of economic growth, capital investment and infrastructure. As the process involves a
long gestation period, one practical way could be to train our youth for employment opportunities abroad. India
already has a strong outflow of migrants of which two-thirds migrate to the Gulf countries, 13 per cent migrate to North
America while Asian countries, other than Persian Gulf, absorb about 10 percent. In contrast, fast-ageing Europe
attracts less than 3 per cent of migrants but offers excellent opportunities for high and medium-skilled labour,
especially in Italy, Germany, Poland and France. These opportunities need to be availed of the near future by
appropriate manpower planning. In recent years, migration to countries like Spain, Switzerland, Italy and the U.K. has
increased but not in significant numbers to Germany, France and Poland. In fact, the flow of migrants to countries like
Portugal and Austria declined in the last decade. These countries need immigrants as the native population in many of
these countries is shrinking, given the low birth rate averaging 1.6 births per woman against the replacement rate of
2.1. In countries like Germany, Spain, Italy, and Poland, the birth rate is less than 1.5 births per woman and these
countries depend on immigrants. According to official statistics, consequent to ageing, one-third Europeans would be
above 65 years of age by 2060. Consequently, migration to Europe is expected to increase significantly by 2020 1
million in Germany, 1.1 million in Spain, 1.3 million in Poland, 1.4 million in the U.K., and 2.1 million in France.
Further, migration is expected to add up to 60 million people in Europe by 2060.
Providing suitable skills
In view of the fact that Indians migrate to the West in large numbers, the need is to ensure that they are suitably
skilled. The plight of most illiterate and non-skilled migrants, generally illegal migrants, is pitiable. To equip them with
suitable skills, cooperation from countries which are seeking immigrants can be sought. The Ministry of Overseas
Indian Affairs can explore guided migration agreements, bilateral with each of the countries in Europe and multilateral
with the Euro area to educate and prepare migrants for the destination countries. The universities from these countries
can be invited to India to train our youth in soft skills and necessary professional activities. Such well-trained migrants
would serve two important functions: they would serve as brand ambassadors of the country and as a rich source of
remittance.
Helping the elderly
There is one silent segment of the population, the elderly, which gets neglected in most of the policies of the
government. There are more than 11 crore elderly people in India who are above the age of 60 years generally women
who are in urgent need of care, as nearly 90 per cent of them who are associated with the unorganised sector are not
included in any sustainable social security programme. While some three crore elderly people who are under the below
poverty line category get about Rs. 500 as old age pension, the remaining eight crore have to fend for themselves. In
view of the weak and inadequate public healthcare system, they have limited access to medical services, many research
studies have discovered. In contrast to many countries in Europe where age-related expenditure on health and care is
8-10 per cent of GDP, it is less than 1 per cent in India. Some simple initiatives to help the elderly could include
granting respectable amounts of universal pension and universal insurance to help them live with dignity. The
universal pension could increase with age, especially for women.
Finally, there is a need to address two things in connection with changing demographics in India a need to have a
think tank to study the problems of the elderly and age-related financial economics and a need to develop the science of
medical gerontology, an area which is neglected in the country.
(Charan Singh is RBI Chair Professor of Economics, Indian Institute of Management, Bangalore.)
Keywords: unemployment, employment creation, joblessness, demographics