Digital India's Triumph: Economic Survey 2024-25 Projects $1 Tn Milestone For Digital Economy
$1 trillion and counting: India's digital economy is on fire! It is not only expected to create a huge number of jobs, it will likely transform the labor market, says the Economic Survey 2024-25.
India's digital revolution is on! The Economic Survey 2024-25 today indicated it sees India's digital economy driving employment opportunities in a big way. The digital economy projection was seen at an enormous over $1 trillion and that too by 2025 itself. The Survey was quoting Ministry of Electronics and Information Technology (MeitY) numbers.
The Survey was basing this projection on the fact that the Indian digital economy has broadened job opportunities in a significant manner, encompassing roles from, at the lower end of the job hierarchy including delivery personnel, cab drivers, and beauty professionals, all the way to the higher strata encompassing software engineers and data analysts.
Playing a significant role in this were hyperlocal service platforms. In fact, the Survey said that they have actually revolutionised the job landscape in the transportation, food delivery, and home services industries. "These platforms have created flexible employment options by leveraging technology while transforming traditional service sectors into digitally driven ecosystems".
The job numbers indicated were massive too. According to NITI Aayog, the gig workforce itself is projected to reach 23.5 crore by 2029-30, comprising 6.7 per cent of the non-agricultural workforce and 4.1 per cent of total livelihoods. It expects the same to reshape the labour market.
The reason behind the enormous expansion of India's gig economy is being fuelled by platformisation and remote work, the Survey added.
The Survey quoted Acemoglu and Restrepo (2019) note on digital technologies' dual impact on employment. It said that though automation replaces human labour through a displacement effect, at the same time it creates demand for new roles. It referred to it as the "reinstatement effect". It said, "This technological reinstatement effect has the potential to drive labour demand and create numerous new job positions, positively impacting employment".
Role of Government
The Survey said that to convert digital economy's immense potential of boosting employment opportunities into reality across different industries, "It is crucial to have the right policies...." This is necessary also to to address potential negative impacts on labour share due to automation and digital integration, it added.
