Home / Opinion / Blogs /  India’s jobs challenge

It is now well acknowledged that job creation is one of India’s biggest policy challenges. The deputy prime minister of Singapore, Tharman Shanmugaratnam, a keen India watcher, rightly pointed out last week that India has lost a lot of time in this area and needs urgent policy changes.

A big failure over the decades has been India’s inability to develop large-scale, labour-intensive manufacturing industries. In the absence of more productive manufacturing jobs, too many Indians continue to depend on agriculture for their livelihoods. This needs to change.

To be sure, there are no easy solutions. In order to facilitate the growth of the manufacturing sector, India needs a comprehensive package of reforms in the factor market, among other things. Further, policymakers would do well to accept that slower growth in global trade and rising automation will only increase complications. Therefore, India needs to move fast, as failure to create jobs can have adverse economic and social consequences in the medium to long run.

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