India's Integration Into Global Value Chain To Produce Quality Jobs: Soumya Kanti Ghosh

The major issue in India is not just about employment, but also the quality of employment, according to SBI Group Chief Economic Advisor Soumya Kanti Ghosh.

Currently, there are many jobs which only pay around Rs 15,000 to Rs 20,000 per month, which are not that high, he said referring to a Employees' Provident Fund Organisation report.

“India should get integrated into the global value chain. This will help India to move up in the manufacturing value chain, since this is where the nation can produce good quality jobs,” Ghosh told BQ Prime.

India should have an employment policy which not only caters to the country as a homogeneous nation, but also focuses on different regions, he said.

In northern states like Bihar and Uttar Pradesh, more than 40% of the population are in search of jobs as compared with the south, which is more prosperous. So, when the government plans to set up any manufacturing plants or Special Economic Zones, such regions should be taken into consideration, he said.

According to him, self-employment in India has always been above 50% and after the pandemic, the number of unpaid labourers and family employees have also risen. The idea that a lack of remuneration to these self-employed groups has created an employment distress in India is a misconception which people hold, he said.

With the formalisation of the credit system, unorganised sectors are receiving loans and credit from many formal institutions. This is majorly utilised by the family employees as it helps them to make their business more rewarding, Ghosh said.

“Even with the existing government offers in terms of food, clothing, shelter, which is also used by the state government, it further helps people to make a choice of where to work and how to work,” he said.

The unemployment rate among youth, between the age bracket of 15 to 30 years, is reported to have increased in India to about 10%. However, Ghosh said that it’s not an accurate way to look at it.

While considering a smaller portion of population aged 15 to 30 years, the unemployment rate will be around 10%, considering that people are still receiving their formal education and joining work later. Hence, they should not be considered as unemployed in the true sense, he said. "But, when we consider 15 to 59 years, the rate is much lower around 3.2%."