Turbocharge India’s Youth for a Sustainable Economic Comeback

Context: India needs to invest in human capital through the help of private and global financial institutions to avoid the youth advantage into a demographic disaster.

India’s Demographic Potential: 

• Low Median age of 25 years compared to 40 in China and the US and 50 in Europe.

• World’s largest youth population: exceeding 500 million.

Challenges to Demographic Potential:

• Low Investments in Human Capital: Investments have not kept pace with the structural and technological transformations.

• The country will add 12 million new workers every year.
• Agriculture, which employs more than half of that force, will not be able to employ new entrants.
• Non-agricultural jobs must take the lead role but are more skill-intensive.

• Education Crisis: created due to COVID pandemic may yield a generation that will lose out on learning.

• Even before the pandemic, access to basic education was denied to the bulk of school-aged children.
• The digital divide due to the insistence on online mode of education delivery has been not accessible or affordable to everyone.
• Focused more on urban areas and on formal sectors leaving small towns and rural areas.
• Failure of Hub and Spoke models in promoting collaboration between private, ministries and public sector.

• Gender Gap:

• More than 225 million women are still not in the labour force.
• Women face social and cultural barriers, limiting their access to education and work.

Way Forward: 

• Modernise current model through technological advances: to escape a low-skill equilibrium trap.

• Policymakers need to tap the digital arena:

• India has the second-largest internet subscribers (500 million) after China
• Indian spend more than 20 hours a week on social media and use a lot more data than Americans.
• Technological changes have enabled entrepreneurs to operate at a smaller scale gaining from networking and agglomeration economies.

• Promote Public-Private Partnerships (PPPs) in data collaborations:

• India needs a database of local IT capabilities and must provide local IT training in small towns and rural areas.
• Data collaboration can overcome the asymmetry in the information that has plagued skill development in the past.
• PPPs can also help private companies boost their brand reputation, channel their development spending, and identify new opportunities.

• Promote online skills and education programmes:

• India’s culturally and geographically diverse population stands to gain a lot from mobile learning,

• Empowering Women: Gender parity is both an economic and moral imperative.

• Bringing women to participate rate similar to that of men could boost the economy by 30%.
• Gender budgeting can inspire fiscal policies in key areas such as education and skill development.

• Unlocking more resources: through the help of regional and global development banks to meet the fiscal need for online learning.

• Keeping digital technologies open and global: as it is a force of good and should not be chained in the face of efforts by the governments to fragment it.