‘Make In India’ Has Failed To Create Enough Jobs: L&T Chairman AM Naik
"We are exporting jobs now instead of exporting goods."
The Narendra Modi-led Bharatiya Janata Party government’s flagship “Make in India” initiative has failed to create enough jobs as companies prefer importing goods over manufacturing locally, said Larsen and Toubro Ltd chairman AM Naik.
Per a Mint report, Naik, who also heads the National Skill Development Corporation (NSDC), a public-private partnership, said in an interview: “The Prime Minister’s Make In India programme, which is spoken about a lot, has to do a lot more. We are exporting jobs now instead of exporting goods. We have to find answers as to why most Indian companies are keen to import rather than manufacture here.”
Naik further said that another reason for high imports was the scarcity of financing options for Indian companies. He said: “We allow imports because it often comes with a credit facility.”
Naik also said that job creation, especially in the manufacturing sector, has failed to keep pace with the supply of skilled labour.
“The mismatch between the right skills and jobs will always be there,” said Naik. “But it’s the gravity of the situation that matters the most. We need at least an economy equivalent to China’s since our population is almost the same. Otherwise, there is always going to be a shortage of jobs; and unless the economy grows like it did in China, which means at least 12-13 per cent growth every year, this disparity will remain. We are not able to create jobs at the pace needed to bridge this gap,” he said.
Unemployment in the country is at a four-decade-high. Figures released by the Ministry of Statistics and Program Implementation (MoSPI) a few months ago, pegged joblessness at 6.1 per cent.
As per a Mint analysis of the unit-level data from the Periodic Labour Force Survey (PLFS) 2017-18, nationally, only 1.8 per cent of the population reported receiving formal vocational/technical training in 2017-18. 5.6 per cent reported receiving informal vocational training (such as hereditary, self-learning, and on the job training). Essentially, 93 per cent of the population did not receive any vocational or technical training from either formal or informal sources. But it gets worse from there. The report further adds that about 42 per cent of the youth who received formal technical training was not part of the labour force at all. And among youth who did not receive such training, 62.3 per cent were out of the labour force.