Comment on the challenges for inclusive
growth which include careless and
useless manpower in the Indian context.
Suggest measures to be taken to face
these challenges.

GS 3
Economy
2016
12.5 Marks

Subject: Economy

India's pursuit of inclusive growth faces significant hurdles due to the challenge of skill-employment mismatch and underutilized human resources, impacting the nation's demographic dividend potential.

Key Challenges for Inclusive Growth

1. Human Capital Related Challenges:

  • Low Literacy Levels: According to a 2010 study, approximately 740 million Indians lacked basic reading abilities, hindering their employability and economic participation.
  • Poor Educational Outcomes: A 2022 study revealed that 11% of Class 3 students lack basic math skills, while 37% have limited mathematical abilities.
  • Skill-Job Mismatch: Despite having a large workforce, there's a significant gap between industry requirements and available skills, leading to unemployment and underemployment.

2. Structural Challenges:

  • Limited Educational Investment: Despite increasing allocation from ₹1.04 trillion (2023-24) to ₹1.28 trillion (2025-26), spending remains below the NEP 2020 target of 6% of GDP.
  • Regional Disparities: Uneven development across states creates pockets of unemployment and underutilization of human resources.
  • Informal Sector Dominance: Large informal workforce lacks social security and skill development opportunities.

Measures to Address Challenges

1. Policy Interventions:

  • Implementation of comprehensive skill development programs through National Skill Development Corporation (NSDC).
  • Strengthening MGNREGA implementation for better employment generation and skill enhancement.
  • Expanding Pradhan Mantri Jan Dhan Yojana (PMJDY) for greater financial inclusion.

2. Educational Reforms:

  • Focus on quality education and vocational training aligned with industry needs.
  • Integration of practical skills in curriculum through National Education Policy 2020.
  • Promotion of industry-academia partnerships for better skill development.

3. International Collaboration:

  • India's initiative to fund global skills gap study under G20 2023 with ILO and OECD collaboration.
  • Knowledge sharing and best practices adoption from successful international models.

The path to inclusive growth requires a multi-pronged approach focusing on skill development, quality education, and employment generation. Success stories like Singapore's SkillsFuture initiative and Germany's Dual Education System can serve as valuable models for India's skill development journey.

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