19 Million Applications. 62,000 jobs

This is the first edition of The Jobscape, our fortnightly round-up of news and opinion on the state of employment and job creation in India. In the months ahead, we hope to delve deep into the issue and bring you both fresh insights and sustainable solutions to a vexing issue. For more, follow us on Twitter at @20Mjobs.Read More  

Modi has done the smart thing refusing UAE’s aid for Kerala. Stop the politics over it

The ongoing public debate on whether India should accept foreign aid to help Kerala recover after the flood disaster reminds me of an incident that occurred in December 2004.A couple of days after the devastating tsunami had ravaged India’s coastlines leaving hundreds of thousands displaced, I sought a meeting with Alok Prasad, India’s high commissioner to Singapore at that time. Several of my friends in the city-state were in the process of setting up collection points for relief materials, and I offered to help the high commission to use the internet to coordinate such efforts.Prasad’s response angered me. He said it wouldn’t be necessary and that the high commission would not encourage the NRI community to send relief material. Instead, he suggested that I direct people to donate to the Prime Minister’s National Relief Fund (which, in the event, many of us did). I recall Indian banks waived the usual remittance charges for such contributions.Read more

80 years before Kerala floods, Mahatma Gandhi blamed caste system for natural disasters

When S. Gurumurthy insinuated that the Kerala flood disaster was somehow related to allowing women into the Sabarimala temple, he revealed a failing that afflicts even mahatmas in India. After the devastating Lisbon earthquake, the Catholic religious establishment put forth the view that the disaster was divine punishment for human sin. This angered the Marquis of Pombal. Pombal was no doubt a ruthless autocrat, but he is relevant to the current flood crisis in Kerala. Today, as we despair about the enormity of the calamity that has struck Kerala, we can take heart to the empirical evidence that shows natural disasters can improve long-term economic growth.Read more

Modi govt will further alienate the south by moving Aero India to Uttar Pradesh

Moving the Aero India show from Bengaluru to Lucknow — as the Modi government is reportedly considering — is a bad idea that will not only hurt India’s economic interests but also deepen the sense of grievance developing in the southern states. Political leaders in Karnataka have already come out strongly against the move.It is wholly unnecessary to move this global event out of Bengaluru in order to promote economic development in Uttar Pradesh. Given the massive growth projections for India’s defence and aerospace sectors, it is unfathomable why the defence ministry should think in zero-sum terms.Why not organise an entirely new and different event in Lucknow? Given the plans to set up a defence industrial corridor in Uttar Pradesh, there might be a case for a big industry event. It just doesn’t have to come at Bengaluru’s expense.Read more

Return of political commissar

A couple of years ago, top executives of a mid-sized Western multinational found themselves in Beijing attending a strategy meeting of their Chinese subsidiary. After they covered the listed agenda, they found their local CEO cribbing about their Indian operation and how his Indian counterpart was dropping the ball, missing business opportunities, and suchlike.Read more

The strategic dimension of higher education

Having studiously avoided all entrance examinations for the past 25 years, I was struck last week when my colleagues showed me a few questions from the Gaokao, China’s annual national college entrance exams. Now, I’m familiar with the debate over the Gaokao and its flaws, especially over whether it selects for merit as is claimed, but I was not prepared for what I saw in the question paper.

A report in this newspaper by Anish Kumar (“Is Gaokao world’s toughest exam? 10 questions from China’s school test.” July 10th, 2018) has many examples, but here’s one to give you a sense of what the equivalent of Indian 12th-grade students must answer: “Between June and August, a cruise ship travels from Fujian province to Venice, via Mumbai, as part of Xi’s 21st-century maritime silk road strategy. Which of the following would it experience on the way?” Here’s another ”Write an essay on how Thomas Edison would react to the mobile phone if he visited the 21st century.”

I saw a question in the mathematics paper that required basic arithmetic but needed the student to apply the mind to figure out how to approach it. In addition to Chinese and Mathematics, students must take a foreign language (English, Russian, Japanese or French) and either science or humanities. Many of the questions require reasoning and application, not a mere rehearsal of what was in the syllabus.

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Higher education and the role of government

Dilip Thakore has asked me to respond to the question “Are low tuition fees destroying Indian public higher education.”

Let’s take a step back.

1. Why should the government fund higher education? The general answer to this that there are positive externalities to higher education, and that the optimum level of higher education in society is higher than what the market can provide on the basis of private incentives. In India, there is also the issue of the constitutional mandate for social revolution. Government intervention in higher education is seen as one important way to achieve an equitable and egalitarian society.

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MoD has politicised security for electoral reasons. Opening of cantonment roads shows that

While the MoD must be cognizant of the demands of civil society, its primary concern is the defence of India. It should, therefore, review the closure/opening of roads from a security perspective and also attempt to assuage the difficulties of citizens.Read more

Get Criminals Out Of Politics

To break the nexus of crime and politics in India, we should not wait until the conviction of accused candidates. Other solutions exist.

With less than 24 hours to go for the assembly elections in the state of Karnataka, the topic of the criminal backgrounds of various candidates is back in focus. A recent report by the Association of Democratic Reforms (ADR) reveals that 391 of the 2655 candidates face criminal charges, and 254 of these face charges of a serious nature. All three major parties, namely BJP, Congress, and JDS, have such candidates on their party tickets.Of course, a criminal complaint is not proof of guilt. The Representation of the Peoples Act (RPA), 1951 states that a person cannot be debarred from contesting elections nor expelled from the parliament or legislative assembly unless s/he is convicted with a jail term of two years or more. However, there are multiple stages between the filing of a criminal complaint and a court judgment that merit consideration.After a criminal complaint is filed, usually in the form of an FIR with the police, there are at least three stages before a court of law begins the hearings. First comes the investigation conducted by the police or other competent authorities, during which they evaluate the merits of the complaints and collect evidence. Next, the investigating authority files a charge sheet with the court. Third, the court studies the charge sheet and appropriately frames charges against the accused. It is only then that the prosecution and defence lawyers begin arguing the case before a judge.Read more here>

Why the south-vs-north debate is a flawed way to analyse the 15th finance commission formula

If this argument of south-vs-north is followed through, a direct corollary would be to also oppose money flows from Bengaluru to Bidar or from Whitefield to south Bengaluru.

The terms of reference for the 15^th finance commission (FC) have come under attack from many quarters in the last few weeks. Of these, the most prominent line of attack is that using 2011 census data will end up hurting the interests of the southern states.Since their population is one of the factors considered while distributing tax revenues among states, some say the southern states will be punished for controlling their population. To resolve this moral hazard, a few southern states are demanding that the dated 1971 census be used for the FC’s revenue distribution formula.But this claim and the ‘north-vs-south’ debate sidestep other substantial flaws in the terms of reference for the 15^th FC.Read more here>

Where is the Nudge Unit?

The government had promised to use the insights of behavioural economics to shape public policy. This budget revealed no signs of it.

As some of us might remember, in September 2016, it was announced with much fanfare that the government think tank NITI Aayog was going to set up a “Nudge Unit” on the lines of the Behavioural Insights Team in the UK. It was reported that NITI Aayog had tied up with the Bill & Melinda Gates Foundation (BMGF) to go about changing behaviours of people. The policies that were supposedly going to benefit from this nudge unit were the flagship programmes of the current government — Swachh Bharat Mission, Jan Dhan Yojana, Digital India, etc.In delivering his Union Budget speech today, the Finance Minister has laid out the priorities of the Union Government for the next year. However, Mr Jaitley did not mention anywhere that this Government will spend any money and effort on incorporating behavioural insights into public policy.It’s impossible to know whether NITI Aayog’s Nudge Unit has been set up and what it is working on. Neither the NITI Aayog website nor the BMGF website has any information that hints at setting up of such a unit. What is more, in February 2017, the Government had cut its ties with BMGF on a health mission due to an apparent conflict of interest. We do not know how that incident affected BMGF’s promise to fund the nudge unit.Read more here>

Sell All Municipal Schools

Poor parents are voting with their feet by shifting their kids from free government schools to budget private schools. The government has failed to provide quality education. Here’s an unintuitive solution for Mumbai. Sell municipal schools. Use the proceeds to fund the education of the poor.Read more

But What About the Jobs Crisis?

There was a big push for the MSMEs in this year’s budget. The Finance Minister emphatically stated that “Medium, Small and Micro Enterprises (MSMEs) are a major engine of growth and employment in the country,” and went on to allocate Rs 3794 crores (quite a small number) to the MSME Sector for giving credit support, capital and interest subsidy and innovations. This was lauded by many as a policy push in the right direction.

The wide-ranging consensus on the importance of MSMEs in India is impressive. There is near universality in declaring MSMEs to be the engine of economic growth in India and the driver of job creation. Just for clarity on terminology, a micro enterprise employs less than 10 people, a small enterprise less than 50 people and a medium enterprise less than 300 people. This definition is according to the World Bank, though countries often classify them according to the initial investment (India), turnover, and other criteria.

There are numerous reports, even by reputed consulting firms, that speak about the benefits of MSMEs. The reasoning for this is often fallacious. “MSMEs will generate employment in the future, because they provide employment now” is the general reasoning. Imagine if the same thinking persisted in the 1800s when horse carts were the main form of transportation and a major source of employment – chances are that there would be no investment in the railways at all.

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