Not only do vast numbers of young Indians face a dearth of decent jobs, it now turns out that many of them are unemployable too. That’s the stark message from the Annual Status of Education Report (Aser) published last week.

Here are some highlights: after eight years of schooling, only 43% of 14-18-year-olds could do simple division; slightly less than half couldn’t add weights in kilograms; more than 40% couldn’t tell hours and minutes from a clock; 46% didn’t know which city was the capital of India. We’ve been so busy congratulating ourselves for herding these kids into school that we’ve forgotten to teach them anything.

This is not the first time Aser has pointed to the dismal state of the education system in India, nor is it the only survey to have done so. In December 2017, a working paper from Research on Improving Systems of Education (RISE) had this damning assessment of Indian board examination papers: “In India and Pakistan, higher-order skills were almost entirely lacking and the focus was very much on recall of very specific rote-learnt knowledge." They said our examination systems were worse than those of Nigeria and Uganda.

The World Bank says the same thing. In its latest World Development Report, it says the percentage of grade 2 kids who could not read a single word of a short text or perform a 2-digit subtraction is higher in India than in Uganda and Ghana.

In its Global Economic Prospects, the World Bank projected potential GDP growth in South Asia over the next 10 years at 6.7% per year, slightly lower than in recent years. It added that investment in education could raise that potential growth rate. Coincidentally, Fitch Ratings puts India’s potential growth rate at 6.7% for the next five years and adds that access to education is one factor holding back growth in productivity. Measuring potential growth is very tricky, but what they’re saying is the dismal state of our education system is going to hobble economic growth.

It’s well known that East Asian countries emphasized education as a cornerstone of their development strategy. More recently, writing in a World Bank blog, Eric Hanushek, a professor at Stanford University, said, “What is driving the East Asia miracle? On the whole, East Asian kids learn more each year they are in school than those in other places, producing a highly skilled labour force."

But is the outlook really that gloomy for India? It depends on where you stand in the country’s income distribution and whether you reside in rural or urban India. There’s no question that the global economy is changing and the much-heralded Fourth Industrial Revolution calls for higher skills from workers. 18-year-olds who can’t do simple division are unlikely to find employment in this brave new economy, other than in menial drudgery.

But note that the Aser study is about education in rural areas. There’s a vast gap between education in rural and urban India. The National Sample Survey Office’s Key Indicators of Household Consumer Expenditure showed that in 2011-12, average monthly expenditure on education for those in the 50th-60th percentile of income distribution (the real “middle class") in rural India was Rs31.47. For those in the same percentile in urban India, the figure was Rs125.49. Such a big difference is likely to be reflected in the quality of education too. Moreover, monthly spending on education for the top 5% of urban Indians was Rs908.12. For the bottom 5% of our rural countrymen, it was Rs7.54. What these figures show and what everybody knows is there is enormous inequality in access to quality education in India, which results in massive inequality of opportunity.

While the sons and daughters of the top 10% are able to get good jobs and compete with the best in the world, the vast majority of poor kids will eke out a precarious living in the informal sector.

True, the concern is that the fourth industrial revolution will change the economic environment, placing a big premium on skills, but there is no reason why the top echelons of the Indian population won’t be able to master those skills. And, given India’s size, the top 10% or 20% adds up to a very big number, bigger than entire nations.

What about the rest? Upward mobility due to increased educational opportunities has improved and a few of the bottom 80% will no doubt better their lot. The rest will fall even further behind. But they have their place in the economy. They will do the backbreaking work in our sweatshops and at our construction sites, so necessary for keeping our costs low. They will provide the army of maids and watchmen and sweepers and other servants so necessary for the comfort of their richer countrymen.

Is education such a low priority for us because we lack resources? Not really—Vietnam, poorer than us, has consistently done better than the OECD average in PISA (Programme for International Student Assessment) scores. And as we’ve seen, India’s educational outcomes are worse than in several poor African countries.

Is it because of lack of ideas? Hardly. There is no dearth of suggestions and prescriptions about what needs to be done. The Aser reports, World Bank studies, Unesco publications, innumerable seminars and no doubt several reports by expert committees all have excellent suggestions, which are gathering dust in mouldy government cupboards.

The real questions we need to ask are: why aren’t these suggestions heeded? Why is the pace of change so glacial? How is it that India, which is a democracy and therefore supposed to be more responsive to the needs of its people, does so badly on education compared to East Asian nations with either no democracy at all or a patchy history of democracy?

Perhaps the most important question, the question we usually prefer not to ask, is: could it be that our ruling classes don’t really care what happens to the poorer half of our children?

Manas Chakravarty looks at trends and issues in the financial markets.

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