Eco Survey: Need to convert demographic burden into asset to push growth

NEW DELHI: India needs to improve quality of manpower and create more jobs to convert its demographic "burden" into an asset to push growth through a bottom-up approach using its village panchayats and urban local bodies as agents of change, says the Economic Survey 2014-15.

"The challenge for the country now is in planning and acting towards converting its demographic 'burden' into enhanced opportunities for growth by dovetailing the quality of manpower to the requirements of employers (off-farm, industry and services sectors), both domestic and international," the Survey said.

It suggested that for translating demographic burden into dividend, a 'bottom-up' approach using Panchayati Raj institutions and ULBs (Urban Local Bodies) as agents of change is the need of the hour.

"Since demographic predictions warn that the promise of the demographic dividend will not last long, in any case not beyond 2050, India needs to take advantage of this demographic window in the next couple of decades," it added.

The government document also pointed out that since labour force growth is in excess of employment rise, labour absorption will be a challenge and therefore reforms and faster economic growth will be critical.

According to the survey, creating more rapid employment opportunities is clearly a major policy challenge.

As per the estimates of employment growth and its elasticity related to economic growth vary widely. However, tentatively, one might say that employment growth and elasticity have declined in the 2000s compared to the 1990s, it added.

It further said that regardless of which data source is used, it seems clear that employment growth is lagging behind growth in the labour force.

For instance, according to the Census, between 2001 and 2011, labour force growth was 2.23 per cent (male and female combined). This is lower than most estimates of employment growth in this decade of closer to 1.4 per cent.

With women accounting for nearly 48 per cent of India's population (Census 2011), there is a need to ensure and safeguard their place in the socio-economic milieu.

Since this requires a change in the patriarchal mindset of the larger population, the government has to continue to be a proactive facilitator of this change through consistent policies, the Survey suggested.

Low levels of education and skill deficit are responsible for low income levels of a large majority of the labour force, thereby perpetuating inequality, it added.

On labour reforms, the Survey said that multiplicity of labour laws and difficulty in their compliance has been an impediment to industrial development.

The government has proposed amendments to various labour laws to align them with the demands of a changing labour market.