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GS Paper: Issues relating growth and development, employment

  • Job Losses during Lockdown

    The data by the Centre for Monitoring Indian Economy (CMIE) briefs us about the job losses due to lockdown restrictions imposed because of the COVID pandemic.

    We can utilize this data as examples for answer writing.

    CMIE data on job losses

    • Salaried jobs: They suffered the biggest hit during the lockdown, with a total loss estimated to be at 18.9 million during April-July.
    • Informal and non-salaried jobs: They have shown improvement during the same period increasing to 325.6 million in July from 317.6 million last year, an increase of 2.5 per cent.
    • Small traders, hawkers and daily wage labourers: They were the worst hit by the lockdown in April, comprising 91.2 million of the jobs lost from the total loss of 121.5 million in that month.
    • Farm employment: A sharp rise was seen in June to 130 million, with good rains and the consequent sowing absorbing a lot of the labour that was lost in non-farm sectors.

    About CMIE

    • CMIE, or Centre for Monitoring Indian Economy, is a leading business information company.
    • It was established in 1976, primarily as an independent think tank.
    • CMIE produces economic and business databases and develops specialised analytical tools to deliver these to its customers for decision making and for research.
    • It analyses the data to decipher trends in the economy.
  • [pib] Thenzawl Golf Resort Project

    Union Minister for Culture & Tourism has inaugurated the “Thenzawl Golf Resort” Project at Aizawl, Mizoram.

    Try this question for mains:

    Q. Swadesh Darshan Scheme is one of the most ambitious schemes to transform the tourism industry in India. Comment.

    Thenzawl Golf Resort Project

    • The Project is sanctioned under the Integrated Development of New Eco-Tourism under Swadesh Darshan- North East Circuit.
    • It is designed by Graham Cooke and Associates, one of top-ranked Canada based Golf Course architectural firm.
    • It is designed to have facilities of international standards.
    • The competitive advantage of Thenzawl Golf Course is that it will provide quality golfing experience and international facilities at a fair price.

    Back2Basics: Swadesh Darshan Scheme

    • Swadesh Darshan Scheme is one of the flagship schemes of the Ministry of Tourism, for development of thematic circuits in the country in a planned and prioritized manner.
    • The scheme was launched in 2014 -15 as a Central Sector Scheme.
    • It aims for integrated development of theme-based tourist circuits in the country.
    • Under the scheme, the identified thematic circuits for development are: North-East Circuit, Buddhist Circuit, Himalayan Circuit, Coastal Circuit, Krishna Circuit, Desert Circuit, Tribal Circuit, Eco Circuit, Wildlife Circuit, Rural Circuit, Spiritual Circuit, Ramayana Circuit, Heritage Circuit, Sufi Circuit, and Tirthankara Circuit.
    • “Development of North East Circuit: Imphal & Khongjom” is the first project implemented under the Scheme.
  • Skill India For Atmanirbhar Bharat

    As India embarks on the path of self-reliance through Atmanirbhar Bharat Abhiyan, it has to nurture the skilled workforce. This article highlights the need to upgrade the skills or upskill the youth to meet the employment needs of technology-driven 21st century.

    Context

    • The effects of the pandemic are expected to have a lasting impact on every sphere of activity.
    • Considering this impact, India announced the Atmanirbhar Bharat Abhiyan to propel the country on the path of self-sustenance.

    Objectives

    • Atmanirbhar Bharat has twin objectives- short term and long term.
    • 1) Reviving different spheres of the economy in the short term.
    • 2) Insulating India from any future global economic downturn, by making it robust in the long run.
    • The Abhiyan seeks to build capacities across sectors and promote local products.
    • Further, it would focus on scaling up manufacturing, accelerating infrastructure development, attracting investments and promoting a consumption-led growth.

    Youth: Strength of India

    • About 65 per cent of India’s population is below 35 years and 50 per cent is below 25 years.
    • With a huge, educated young population, India is uniquely poised to realise its demographic potential.
    • The fact that Indians are heading several MNCs shows that there is no dearth of knowledge and talent in the country.
    • However, we need to upgrade the skills or upskill the youth to meet the employment needs of technology-driven 21st century.

    Opportunities and challenges

    • Pandemic and is being seen by many as an opportunity to upgrade their knowledge and acquire new skills.
    • The fourth industrial revolution has triggered a paradigm change in which digital technology drives the job market.
    • Remote working with increasing adoption of digital technology might continue to be dominant mode of working for the near future.
    • It is estimated that nearly 70 per cent of the world’s learners are affected by school closures due to pandemic across education levels.
    • Artificial intelligence, machine learning, data science, cloud computing and Internet of Things will be area of interest for companies.
    • With people opting to online buying, companies will seek to adopt new online marketing strategies.
    • Another important issue that needs to be addressed is ensuring equitable employment through higher participation of women in the workforce.

    Way forward for Atmanirbhar Bharat

    1) Local to glocal

    • There have been some reassuring developments with an accent on “local to glocal”
    • The production of several lakh PPE kits, a collaboration of automobile industries to produce ventilators, manufacture of more than 70 Made in India products by the DRDO are just a few examples of the capability of Indian scientists, IT professionals and technocrats.

    2) Reducing import

    • We must aim to gradually reduce imports in every sector from crude oil to heavy machinery.
    • This reduction should be based on the locally available resources, talent, and skills of the human capital.

    3) Globally competitive product

    • While remaining vocal about local, we must aim at making Indian products to be globally competitive. 
    • We should try to stay ahead in the innovation-led knowledge economy.
    • PSUs and the private sector should not only complement but collaborate wherever feasible.
    • The private sector must massively step up investments R&D. PSUs too need to modernise in terms of technology.

    Consider the question “Atmanirbhar Bharat Abhiyan has the aim of reviving the Indian economy. Examine its objective and how it seeks to revive the economy”

    Conclusion

    To remain globally competitive with a well-assured future, we need to focus on “skills, scale and speed”. India has the potential to emerge as the global hub for providing skilled manpower to other nations.

  • Safety net of income post Covid

    Providing a minimum basic income post-Covid will require some novel approach. This article proposes an approach with the mix of direct cash transfer and changes in the employment guarantee scheme.

    Non-universal targeted programs

    •  It is true that a universal schemes are easy to implement.
    • Non-universal targeted programmes face the problem of identification.
    • Narrowly-targeted programmes will run into complex problems of identification.
    • And the problem of identification gives rise to exclusion and inclusion errors.

    How to solve identification problem

    • There are three proposals which meet the objective of providing a minimum basic income.
    • 1) Give cash transfers to all women above the age of 20 years.
    • 2) Expand the number of days provided under MGNREGA.
    • 3) Have a national employment guarantee scheme in urban areas.
    • In all the three proposals, there is no problem of identification.
    • A combination of cash transfers and an expanded employment guarantee scheme can provide a minimum basic income.

    1) Cash transfer to all women

    • One way of doing it will be to give it to all women say above the age of 20.
    • This is an easily identifiable criterion because the Aadhaar cards carry the age of the person.
    • The female population above the age of 20 is around 42.89 crore.
    • Making available a minimum of Rs 4,000 annually as a cash transfer to all of them will cost Rs 1.72 lakh crore.
    • Which is 0.84 per cent of GDP.
    • The cost of the scheme to the government will be less if the well-off women choose not to take the cash transfer.

    2) Expanding MGNREGA

    • The Act guarantees 100 days of employment.
    • At present, MGNREGA is availed of only for 50 days of employment.
    • One way to help the poor and informal workers is to strengthen it.
    • The government needs to increase the number of days under the scheme from 100 to 150 in rural areas.

    3) Employment guarantee scheme for urban areas

    •  Introducing Employment Guarantee Act in urban areas would help also provide income.
    • Providing employment for 150 days instead of 100 days will also prove beneficial.

    Some facts and figures

    • In 2019-20, the government spent Rs 67,873 crore for providing 48 days of employment to 5.48 crore of rural households.
    • Out of this, the wage expenditure was Rs 48,762 crore.
    • The government has increased the per day wage rate from Rs 182.1 in 2019-20 to Rs 202.5 in 2020-21.
    • So, the estimated expenditure for 150 days of employment to 5.48 crore households in rural areas and 2.66 crore households in urban areas — together they account for 33 per cent of total households in the country.
    •  The additional expenditure needed for the new proposal proposal is Rs 1.9 to 2.5 lakh crore.
    • This additional expenditure is around 1 to 1.22 per cent of GDP.
    •  The total cost of the three proposals would be Rs 4.9 lakh crore or 2.4 per cent of GDP.

    But the total cost could be lower

    •  As the Employment Guarantee Programme is a demand-based programme, the number of days availed could be lower.
    •  This is happening even now.
    • Second, on cash transfers, some women, particularly from richer classes, may voluntarily drop out of the scheme.
    • Alternatively, we can provide that everyone receiving cash transfer must declare that her total monthly income is less than Rs 6,000 per month.

    Where the additional money will come from

    • Removing all exemptions in our tax system would give enough money.
    • Tax experts advocate removing exemptions so that the basic tax rate can be reduced.
    • Perhaps, out of the Rs 4.2 lakh crore which is needed, Rs 1 lakh crore can come out of phasing out of some of the expenditures.
    • While another Rs 3 lakh crore must come out of raising additional revenue.
    • Some of the non-merit subsidies, another item of expenditure, can be eliminated.

    Consider the question “What are the issues non-universal schemes faces? Suggest the ways to do with the issue of identification which such schemes face.”

    Conclusion

    In the post-COVID-19 situation, we need to institute schemes to provide a minimum income for the poor and vulnerable groups and trying the mixed approach of cash transfer to women and modification of Employment Guarantee Acts could do that.

  • Paying attention to condition of migrant workers

    Issue of migrant workers caught attention of the nation amid lockdown. This issue has wider implications for the economy. This article highlights need for formulating a program to deal with the migrant labourers’ issue in its entirety.

    Issue with many implications: Migrant labour

    • Out of the total labour force of 465 million workers, around 91 per cent (422 million) were informal workers in 2017-18.
    • The Economic Survey (2017) estimated 139 million seasonal or circular migrants.
    • Circular urban migrants perform essential labour and provide services.
    • Hence, this issue has implications for livelihoods, agriculture, food security, and safety net policy as well as programme responses.

    Existing and proposed legal provision

    • There exists The Inter-State Migrant Workmen (Regulation of Employment and Conditions of Service) Act of 1979.
    • Despite this act, there is no central registry of migrant workers.
    • The Occupational Safety, Health and Working Conditions Code of 2019 has been introduced in Parliament.
    • This code seeks to promote the welfare of migrant workers and legal protection for their rights.
    • The code seeks to merge 13 labour laws, including the Inter-state Migrant Workmen Act, 1979 into a single law.

    One nation, one ration card

    • “One nation one ration card” addresses the problem of ration-card portability.
    • The move would benefit nearly 670 million people and will be completed by March 2021.

    Provisions in the package for migrant workers, small farmers, street vendors

    • There is a provision of Rs 30,000 crore through NABARD, in addition to the already existing Rs 90,000 crore allocation, for the rabi harvest and post-harvest rabi-related work for small and marginal farmers.
    • Further, Rs 2 lakh crore concessional credit will be provided to two crore farmers across the country.
    • About Rs 11,000 crore was allocated for the urban poor, which includes the migrant workers, for building shelter homes for the homeless.
    • Several government-funded housing projects in major cities would be developed into affordable rental housing complexes on a PPP mode.

    Free grains for two months

    • The Centre will transfer 8 lakh metric tonnes of grain and 50,000 metric tonnes of chana to state governments.
    • Form this stave will provide 5 kg of grain (wheat or rice) per labourer and 1kg of chana per family per month for two months free.
    • This is expected to benefit up to eight crore migrant workers.

    Program for growth and structural transformation

    • Devicing such a program requires a review of national legal, regulatory and institutional concerns in resettlement and rehabilitation of migrant labourers.
    • There is a need to adopt a human rights approach to address the socio-legal issues.
    • The resolution of contradictions in trade, fiscal, monetary and other policies would also require.
    • Following 3 policy changes are urgently required.
    • 1)The implementation of the report of the task force on migration (2017).
    • 2)Expansion of the outreach of the Integrated Child Development Services– to include migrant women and children.
    • 3) Inclusion of migrant children in the annual work plans of Sarva Shiksha Abhiyan.
    • Given the environment of uncertain livelihoods it is necessary to strengthen the resilience of the financial system and skill workers.
    • The issues and challenges of migrant workers require leveraging information and communication technologies and the JAM trinity.

    Consider the question “Migrant workers issue is an issue with many implications. This issue needs to be considered in its entirety to formulate a speedy and effective response. In light of this suggest the required policy changes.”

    Conclusion

    The debilitating physical effects of the coronavirus necessitate coordinated and concerted efforts by all stakeholders to meet the challenges of the present and the expectations of the future. We shall overcome.

  • Reshaping the gig economy

    3 min

    The shockwave that pandemic sent through the economy has been reshaping the global job market. Gig economy would have to accommodate the new entrants. This article underlines the changes in the gig economy after the pandemic. Four areas that need attention are also discussed here.

    What constitutes gig economy?

    • The word “gig” includes in its current parlance all freelancers, disconnected from the workplace.
    • Example: drivers of Uber, delivery boys of Zomato, plumbers and electricians of Urban Clap.
    • The gig economy is not confined to low-skilled jobs. Skilled professionals are also part of it.

    How pandemic is reshaping the gig economy

    • Aviation, hospitality, automobile entertainment and retail are some of the hardest hit sectors.
    • The classic gig anchors- Uber and AirBnB, have laid off thousands of people.
    • In contrast to this, highly skilled professionals —laid off by employers — are joining the gig bandwagon.
    • Surely, job demand will far outstrip supply, at least in the short-term.

    What does the future hold?

    • A Deloitte report from April notes that Indian organisations are considering to expand the share of gig workers.
    • Declining full-time jobs will lead to increased assignment-based hiring.
    • For instance, a graphic designer working from home could be in demand with a media house or Netflix may hire AI designer paid by an hour to personalize streaming.
    • But, what is missing in picture? The national database is missing.

    4 focus areas of gig economy

    1. National database: A missing link

    • National database of job seekers and job creators can connect firms with qualified candidates.
    • A prospective employee would need access to a job database, sorted by skill, geography, duration and emoluments.
    • Companies should be able to dip into the data pool of talent, experience, location, qualification and expectation.
    • Currently, both data sets are fragmented and stored in silos.
    • The government could play the role of a facilitator, in partnership with the private sector.

    2. Regulatory protection to gig workforce

    • The gig economy increases employee vulnerability.
    • This segment of the economy so far has been outside the ambit of regulatory labour policies.
    • Social protection like wage protection, health benefits and safety assurance should be made available to gig workers.
    • The Karnataka government has considered introducing a new labour legislation focused on the gig economy.

    3. Prepare college students for freelancing

    • Apart from regular campus placements, the placement cells need to reorient and focus on preparing students for freelancing opportunities.
    • For the educated youth, this could be the first step towards entrepreneurship.

    4. Gender equality

    • Gender is another crucial dimension of the digital labour markets.
    • The low enrolment of girls for higher education in science, technology, engineering and math would constrict their opportunity in the gig world.
    • Going ahead, this would need greater policy attention to ensure gender parity.

    Consider the question “What is the gig economy? Suggest the policy measures to make it more resilient in the present economic context disrupted by the pandemic.”

    Conclusion

    The government and the private sector would need to collaborate along with academia to build adequate safeguards in the unfolding eco-system.

  • Skill University

    This article highlights the utility of skill education in India. There are several benefits in its adoption. But it would require several regulatory changes. So, what are these changes?Read to know…

    3 issues with our university education

    •  The differential lockdown outcomes for skilled and unskilled workers highlight our university system’s pre-existing conditions. These are-
    • 1) Broken employability promises.
    • 2) Poor employer connectivity.
    • 3) Poor return on private investment that frustrate parents and students.

    4 ways in which skill university differs from traditional university

    • A skill university differs from a traditional university in four ways.
    • 1) It prays to the one god of employers; for governance, faculty, curriculum, and pedagogy.
    • 2) It has four classrooms; on-campus, on-line, on-site, and on-the-job.
    • 3) It offers modularity between four qualifications; certificates, diplomas, advanced diplomas, and degrees.
    • 4) And it has four sources of financing — employers, students, CSR, and loans though employers contribute more than 95 per cent of the costs.
    • Fro example,  in the case of Gujrat government’s skill university, 97 per cent of the university’s budget comes from employers.

    5 ways in which the universities are broken globally

    • First is broken promises.
    • The world produced more graduates in the last 35 years than 700 years before.
    • Second is broken financing.
    • More than 50 per cent of $1.5 trillion in student debt was expected to default even before the COVID pandemic.
    • Indian bank education loans have high NPAs.
    • The third is broken inclusiveness.
    • The system works for privileged urban males studying full-time, but today’s students are likely to be female, poor, older, rural, or studying part-time.
    • Fourth is broken flexibility.
    • Employed learners will cross traditional learners in three years, but they need on-demand, on-the-go, always-on, rolling admissions, continuous assessment, and qualification modularity.
    • And finally is broken openness. 
    • Google knowing everything makes learning how to learn a key 21st-century skill.
    • Yet too many universities are stuck in knowing.

    Let’s look into the regulatory changes needed for the Skill University

    • Skill universities are a scalable, sustainable, and affordable vehicle to massify higher education by innovations in finance.
    • But they need regulatory change.

    Following are the 3 types of regulatory changes needed

    1. Changes needed in the  UGC Act of 1956

    •  Clause 8.2.6 needs to be rewritten to equalise four classrooms -online, on-site, on-campus, and on-job-and section 22 (3) to recognise apprenticeship linked degree programmes.
    • The UGC Teacher Regulations of 2018 need rewriting: Clause 3.3.(I),(II) to redefine the qualifications, roles and numbers of teachers required, and clause 4 to recognise industry experience as a teaching qualification.
    • The UGC Online Regulations 2018 need to be rewritten: Clause 4(2) and 7(2)(3) to allow innovation, flexibility, credit frameworks, and relevance in online curriculums.
    • Clause 7(2)(2) to allow universities to work with any technology platforms.

    2. Changes needed in NAAC IQAC regulations

    • Criteria 1 and 1.2.2 to include work-based learning and work integrated learning.
    • Criteria 1.1.3 to include life skills and proctored/evaluated internships.
    • Criteria 2 and 2.3.1 to integrate online learning with university programmes.
    • Criteria 2 and 2.4.1, 3 and 6 need to be modified to recognise teachers with industry experience, and include industry-based research.
    • Criteria 4 and 4.1.2 to include industry workplaces and online classrooms as campus extensions.
    • Criteria 5 and 5.2.1 needs to be rewritten to incorporate apprenticeships.

    3. Changes needed in Apprenticeship Act of 1961

    • Clause 2, 8, 9, 21 and 23 of The Apprenticeship Act of 1961 also needs to be modified to allow and lift the licence raj for degree-linked apprentices and recognise skills universities.

    Consider the question “Skill universities, which would go a long way in increasing the employability in India are need of the hour. In light of this, examine the issues that the skill education faces and suggest the changes our education system needs to impart the proper skill education.”

    Conclusion

    Covid crisis has amplified the problems with our education system. So, the adoption of skill universities will help us improve the skill of our youth and achieve more inclusive employment, employability and education.

  • Skill universities, which would go a long way in increasing the employability in India are need of the hour.In light of this, examine the issues that the skill education faces and suggest the changes our education system needs to impart the proper skill education.10 marks

    Mentor’s comment-
    • https://indianexpress.com/article/opinion/columns/covid-crisis-employment-education-skill-universities-6458972/
    • Employment has been a recurring theme of the UPSC papers. Consider 2014 question ” “While we flaunt  India’s demographic dividend, we ignore the dropping employability” What are we missing while doing so? Where will the jobs that India desperately needs come from? Explain.
    • So, in this question, in your intro, you should cite figures about the low employability of Indian youth from any employability report.
    • In the body, focus on the issues that skill education in India faces-such as regulatory issues, financing issues, placement issues etc.
    • In suggestions, regulatory changes, proper financing and use of technology can be included.
    • Conclude by stressing how focusing on skill education through skill universities could contribute to increasing the skills and employability of Indian youth.
  • SWADES (Skilled Workers Arrival Database for Employment Support) Initiative

    The Union Govt. has launched a new initiative SWADES (Skilled Workers Arrival Database for Employment Support) to conduct a skill mapping exercise of the returning citizens under the Vande Bharat Mission.

    In the first go, one may get reminded of the SWADESH Darshan Scheme… Please beware! This SWADES initiative has nothing to do with the tourism sector!

    SWADES Initiative

    • SWADES is a joint initiative of the Ministry of Skill Development & Entrepreneurship (MSDE), the Ministry of Civil Aviation and the Ministry of External Affairs.
    • MSDE’s implementation arm National Skill Development Corporation (NSDC) is supporting the implementation of the project.
    • It aims to create a database of qualified citizens based on their skillsets and experience to tap into and fulfil the demand of Indian and foreign companies.
    • The collected information will be shared with the companies for suitable placement opportunities in the country.
    • The returning citizens are required to fill up an online SWADES Skills Card.
    • The card will facilitate a strategic framework to provide the returning citizens with suitable employment opportunities through discussions with key stakeholders including.

    Data on the returnees

    • Amongst the data gathered so far, the top countries from where the citizens are returning are UAE, Oman, Qatar, Kuwait and Saudi Arabia.
    • As per the skill mapping, these citizens had been primarily employed in sectors such as oil & gas, construction, tourism & hospitality, Automotive and Aviation.
    • The data also suggests that the States which have shown highest returning labour are Kerala, Tamil Nadu, Maharashtra, Karnataka and Telangana.
  • Global Economic Prospects (GEP) 2020 report by World Bank

    The World Bank has released its Global Economic Prospects (GEP) 2020 report.

    Try this PYQ from CSP 2019

    Q.) The Global Competitiveness Report is published by the-

    (a) International Monetary Fund

    (b) United Nations Conference on Trade and Development

    (c) World Economic Forum

    (d) World Bank

    Global Economic Prospects (GEP)

    • GEP is a World Bank Group flagship report that examines global economic developments and prospects, with a special focus on emerging market and developing economies.
    • It is issued twice a year, in January and June.
    • The January edition includes in-depth analyses of topical policy challenges while the June edition contains shorter analytical pieces.

    Summary of the report

    In a nutshell, the outlook for the global economy for 2020 has darkened, amid slowing activity and heightened downside risks.

    1) On poverty

    • The scope and speed with which the COVID-19 pandemic and economic shutdowns have devastated the poor around the world are unprecedented in modern times.
    • Current estimates show that 60 million people could be pushed into extreme poverty in 2020.

    2) Policy choices

    • Policy choices made today — include greater debt transparency to invite new investment, foster advances in digital connectivity, and a major expansion of cash safety nets for the poor.
    • The financing and building of productive infrastructure are among the hardest-to-solve development challenges in the post-pandemic recovery.

    3) Emerging Market and Developing Economies (EMDEs)

    • EMDEs face health crises, restrictions and external shocks like falling trade, tourism and commodity prices, as well as capital outflows.
    • These countries are expected to have a 3-8% output loss in the short term, based on studies of previous pandemics, as per the analysis.
    • Growth is likely to slow more in commodity-exporting EMDEs than in commodity-importing ones.