GOI’s job? Find the X factor for factories

There were many reasons for the surprises in LS election results, most related to local issues. However, one common thread nationally was an undercurrent of anxiety among voters, especially in Hindi heartland. It related to jobs and to a lesser extent food prices. People were not necessarily unemployed – they were underemployed and aspired to better jobs.

No one seemed to address their concern during campaigning. BJP offered a vision of a rapidly growing economy that would become world’s third largest, but didn’t bother to relate growth to jobs. Opposition stuck to a message of freebies, promising to fill vacancies in govt jobs. The election has thus sent a clear, sobering message to new govt: create quality jobs.

Missing the jobs | Since 1991, India has grown handsomely, at almost 6% a year, lifting 400mn people out of poverty. Extreme poverty has come down to less than 5% of population. But high growth hasn’t created enough jobs. Why? Because India has failed to create an industrial revolution. It has done exceptionally well in services, but that is not the answer for 45% of nation’s workers, who are stuck in agriculture.

All successful nations have developed by creating an industrial revolution. More recently, East Asian nations – Singapore, South Korea and Taiwan – have become prosperous by following a simple strategy of exporting labour-intensive manufactured products. China is the latest example. India has failed – manufacturing accounts for only 15% of GDP, and India’s share of global exports of goods is less than 2%. To fix this has to be the new govt’s single-point agenda.

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