India Inc. has just recovered from the second wave of the pandemic; already a third wave has affected a few states. So, concerns are flowing again about further economic pause in the country. In this situation the employment scenario should back the domestic economic activities to grow up. Otherwise, India is not going to see a better future soon. To ramp up this employment data, PM Narendra Modi on the country's 75th Independence Day, yesterday announced the union government will launch the 'PM Gati Shakti Master Plan' - worth Rs. 100 lakh crore ($1.35 trillion) project. It is expected to develop India's 'holistic infrastructure'. Additionally, it will expand use of cleaner fuels to achieve the climate goals. It has been pegged as a source of employment opportunity for the youth of India.
PM Gati Shakti Master Plan
The PM stated, "In the coming days, we will launch the PM Gati Shakti Plan, a Rs. 100 lakh crore national infrastructure master plan which will make a foundation for holistic infrastructure and give an integrated pathway to our economy. The plan is expected to help raise 'the global profile of local manufacturers' and compete with their global counterparts.
It will also open the doors of new future economic zones. He added, "Walking the road of development, India needs to increase both manufacturing and export." PM Gati Shakti Plan will be launched to invest more in the infrastructure and manufacturing sector.
The Indian economy has expanded 1.6% year-on-year in Q1 2021 - according to Trading Economics data. The country is looking forward to expanding this figure soon. In addition to that, on the production side, output has increased for the manufacturing sector to 6.9% and for the construction sector to 14.5%. "Net trade contributed negatively to growth as exports climbed 8.8% (vs -3.5% in Q4)" - the data added.
At the end of FY20 on 31st March 21, the economy had a record contraction of 7.3% in GDP. It was less than expected though. The current fiscal has been reported to perform better. Earlier the PLI scheme actually helped India to focus on the domestic manufacturing side and assisted the employment situation. Now, the launch of the Gati Shakti Master Plan is expected to aid the country's overall domestic productions, manufacturing, and export - to ramp up economic growth and employment.
According to the Centre for Monitoring Indian Economy (CMIE), the unemployment rate in India decreased to 9.2% in June, 2021 as compared to 11.9% in May, 2021. The 30 day moving average unemployment rate till June 6, 2021 was 13%. Mahesh Vyas, CEO of CMIE commented, "With income dipping to 97% in Indian households, over one crore plus people will be rendered jobless post the second wave of Covid."
Adil Zaidi, Partner, E&Y earlier stated, "According to the latest estimates by CMIE on India's unemployment rate, it is expected that more could be pushed out of the job market, thereby keeping the unemployment rate elevated over the coming year." Employment scenarios can be categorised into 2 dimensions like 'on-roll permanent employees' and 'off-roll contractual employees'. It is expected that the Gati Shakti plan will encourage both of these 2 dimensions for youths in the country.