Modi has failed miserably in delivering on his promise [made in his speeches in the run up to the general elections in 2014] of creating 20 million jobs every year. To demonstrate their point, the critics often point to hundreds of thousands youth submitting applications for a few vacancies of peon or clerk in government departments/ministries. They cite this yawning gap as an indicator of alleged joblessness in the country.
The underlying assumption behind this inference is that all those hundreds of thousands youth who applied for the available vacancies do not have any work at hand or any source of income. Such an assumption is fallacious. Had it been so i.e. millions of youth without an income source, there would have been anarchy in the country [a person having no earning source is bound to take to street indulging in unlawful activities].
The reality is those millions of seemingly unemployed persons have a regular stream of income but that happens to be from ‘informal’ activities such as working on the farm, animal husbandry, plumber, electrician, gardener, driver, street vendor [for instance, the infamous pakora seller whom Modi referred to during the course of a TV interview] etc. But, in society, these are not considered respectable professions.
It is equally true that a government job even if it happens to be a peon is considered respectable. When, seen in conjunction with the fact that such job is for a life time, carries with it a good salary and perks [besides possibility of making extra money via indulging in nepotism and corruption] makes people go crazy after such jobs. The result is that you have mammoth numbers chasing few jobs. The youth have work and a source of income yet they are jobless!
The problem is not with lack of work and income earning opportunities per se. It has more to do with the mindset of the people and perception of the society about the profession that the youth decide to choose. If, only the society develops a positive stance towards such occupations, there would be better balance between the aspirants and available opportunities. That indeed is the right way to go about.
This is precisely what prime minister, Modi who hails from a poor background and fully understands the problems of the poor and backward classes is endeavoring to do. He has inculcated a sense of pride and respectability to such professions which gets reflected in his umpteen speeches, interviews besides direct interface with the people vide his monthly ‘Man ki Baat’.
Modi’s promise of 20 million jobs annually needs to be viewed in this perspective only. His focus is primarily on enabling a person to set his own business so that he not only creates a work opportunity for himself but also becomes a job provider.
The Pradhan Mantri MUDRA [Micro Units Development Refinance Agency] Yojna – launched in 2015 – has become a harbinger of creating jobs for tens of millions. Under the scheme, loans are provided to persons engaged in small businesses under three categories viz., Shishu – up to Rs 50,000/-; Kishore – Rs 500,000/- and Tarun – Rs 1000,000/- without insisting on any guarantee or mortgage.
Till date, a mammoth 120 million persons have received loans valued at Rs 600,000 crore. 75% of these loans have been given to women who are temperamentally much more sincere and enterprising. Their loan servicing record is also much better. No wonder, the NPAs [non-performing assets] under MUDRA scheme is just about 3.4% which is much lower than the 10% norm.
Of the total loanees, 30 million are borrowers who have set up a new business. Even if a borrower employs one person at the bare minimum, this would mean creation of 60 million jobs [the loanee included]. Of the remaining 90 million who have taken loans for supporting/expanding existing business, even if one third of them provide job to one person each to support their augmented business, this would yield another 30 million. This takes the total to 90 million.
If only, one gets reconciled to the idea of creating jobs through self-employment route [difficult to digest by persons like P Chidambaram, former finance minister under UPA who term ‘a vendor selling pakora is tantamount to begging’], then Modi’s promise of creating 20 million jobs per annum or 80 million jobs in 4 years has already been accomplished.
That apart, GDP growth during the last 4 years was fairly high 2014-15: 7.4%; 2015-16: 8.2%; 2016-17: 7.1%; 2017-18: 6.7%. The growth during the last two years was significant despite the disruptive effect of demonetization [November 8, 2016] and GST [July 1, 2017]. It is evident even to a man on the street that when, there is growth, it cannot be without men working on projects.
Since 2014, the government has undertaken massive investment in infrastructure – both physical and social viz. highways, roads, rails, expressways, ports, waterways; schools, hospitals, homes, toilets etc. It has also been galvanizing private sector to invest by improving the ease of doing business. This has led to job creation including substantial accretion in the formal sector.
As per the EPFO [Employee Provident Fund Organization] data – a fairly good proxy for employment in the formal sector, during the last two years, the addition of jobs was 11.5 million [4.5 million in 2016-17 and 7 million in 2017-18]. This is significant though it cannot match the scale of job creation through self-employment route.
Without doubt, the present dispensation is on track giving impetus to growth and creating ample job opportunities. Yet, attempts to trivialize job creation through self-employment route such as a vendor selling pakora and brand it as tantamount to begging [to cite the phrase used by Chidambaram] sets a dangerous precedent.
This will dissuade youth from taking up these occupations in the pious hope of getting glamorous so called white/blue collar jobs which cannot be created on the required scale – even if the economy grows consistently in double digit.
This imbalance could be a trigger for the ‘demographic dividend’ [a euphoric term for nearly 2/3rd of population falling in 18-35 age group] turning into a ‘demographic disaster’.
Come 2019, the 1.3 billion people of India should ensure that Modi remains at the helm. This is the only way to avert the disaster.