New Delhi: India Inc, the biggest backers of Prime Minister Narendra Modi, has now started acknowledging that the government’s much-hyped ‘Make in India’ has failed to create jobs across sectors. In fact, a top corporate honcho has even declared that India is “exporting more jobs than goods”, as of now.
“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," said L M Naik, the chairman of private infrastructure major, Larsen & Toubro, in an interview with financial daily Mint. Incidentally, Naik is also heading the National Skill Development Corporation (NSDC), public-private partnership creating to enhance skills tailored to the needs of the corporate India.
In the interview, Naik, an industry veteran, pointed out that most of corporate India still prefers to import rather than manufacture products in India. “We have to find answers as to why most Indian companies are keen to import rather than manufacture here,” he said in the interview.
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The interview comes at a time when there have been massive job losses across sectors, especially in the automobile, IT and textile sectors. Recently a report by Society of Indian Automobiles (SIAM) reported the lowest sales in 19 years, warning of another one million job losses in the auto component sector. Already the auto sector has lost over 2.5 lakh jobs with some leading companies announcing production cuts.
It may be recalled that Narendra Modi, during his campaign for the 104 elections had, announced that 500 million people will be provided skill training and 2 crore jobs would be created in a year.
However, despite creating a separate Ministry and skill training of youth, there are not enough jobs to absorb them. This is even as 10 million youth enter the job market each year. Confirming the low absorption of skilled youth, Naik said that job creation, especially in the manufacturing sector, had failed to keep pace with the supply of skilled labour.
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“The mismatch between the right skills and jobs will always be there. But it’s the gravity of the situation that matters the most," Naik said. “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% growth every year, this disparity will remain", he told Mint.
Industry concerns come at a time when economic growth has slowed to 5.8% in the three months ended March 1, attributed largely to weak demand and slowing private investment.
Naik is not the only one. Of late, many corporate bosses have started making noises about the economy slowing down and flagging of investments, even as the Modi government tried hard to divert attention from its failure on the economic front by keeping the narrative of nationalism and Jammu & Kashmir alive.
In July, Rahul Bajaj, one of the top automakers in the country, openly stated that the “economy was in bad shape.”
Blaming the government for poor demand and investment flow in the private sector, the Bajaj Auto chairman said: “There is no demand and no private investment, so where will growth come from? It doesn’t fall from the heavens,”. He is reported to have said this at the company’s AGM in Pune.