[email protected]: Pushing The Start Button
Public private partnership in infrastructure, agriculture and skillset training could work wonders for India’s economy
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Amidst a prolonged uncertainty in global economy, India is like an oasis. With the right reforms, India is certainly capable of experiencing a multi-decade growth phase. As we step into our 71st year of Independence, now is the time to plan ahead by setting goals on where we want to see our nation in its 100th year of Independence in 2047. To achieve this, our policy-makers need to focus on three vital aspects:
Readying India for Industry 4.0: The world is witnessing the unfolding of the fourth industrial revolution or Industry 4.0 or digital revolution. Globally, business models are getting challenged and redefined through digitisation. Some disruptive technologies are shaping up in the form of automation, robotics, 3D printing, AI, VR, genomics, stem cell technology and many others. The consequences of these technologies are yet to pan out fully, but as per early indications these will make some of the present skills and jobs redundant. History of technological evolution shows that over the ages every new technology has threatened certain jobs, but its application has also created new job opportunities. This would be the same for new technologies too.
For a populous nation like ours, where the vast majority of the population is semi-skilled and unskilled and that too with little social security net, the potential impact of these technologies can be cause for genuine alarm.
However, I feel this situation can be converted into an opportunity with some focused efforts. Leveraging our IT prowess, let India take the lead in expeditiously putting together a global online network of knowledge institutions and corporate houses. The responsibility of this network would be to proactively identify the new job opportunities opening up in the wake of new technologies. Thus, active involvement of both industry and academia is a must. On the basis of the findings of this body, training modules and skill upgradation programmes can be designed for new jobs.
Our trained manpower can be an asset for industries from world over and they will find India to be a logical choice for setting up their manufacturing bases. Institutionalising a ‘Train the Trainers’ programme is imperative to ensure adequate supply of quality teaching staff. A public-private participation (PPP) in training and skill upgradation is presently the need of the hour.
PPP in infrastructure: Unlike most other nations, India has built a large part of its infrastructure through the PPP model. Over the last two-and-a-half decades, India has been successful in mobilising more than $300 billion worth private investments. However, the PPP model being a learning-by-doing process for the sector, some errors in judgement happened inadvertently which, resulted in a temporary setback for PPP projects during the early years of this decade. Valuable lessons were learnt from the errors which resulted in further fine-tuning of the policy guidelines. As a result, the pace of infrastructure creation is once again picking up with several infrastructure sub-sectors showing signs of vibrancy. I can foresee the implementation of a much improved PPP model in near future and infrastructure creation will certainly get fast-tracked.
However, what we seem to be missing out is how to tap this knowledge and utilise it in other geographies. Infrastructure is a necessity everywhere — be it a developing nation or a developed one. Worldwide it is the government which takes the lead in infrastructure creation. India’s PPP model is therefore worth replicating in other countries as that will reduce the pressure on the government.
Therefore, our PPP exercises need to be thoroughly documented and this knowledge could be used to develop dedicated infra-specific study modules to create infrastructure professionals for the future. Our infrastructure players need to engage our academia in creating this repository and this collaboration can result in creation of Indian institutions which can be the ‘Harvard’s for infrastructure.
To attract youth to agriculture: Agriculture has always been the backbone of the Indian economy and it is invariably linked with food security and providing direct/indirect livelihood to a huge majority of Indians. While this sector’s share in GDP has kept on shrinking and is presently at around 17 per cent only, almost two-third of the population remains directly/indirectly dependent on agriculture.
One of the prime deterrents for farmers to embrace mechanisation is the high cost of machinery and equipment. Very few farmers can afford to purchase farm machinery. If these same assets are made available to them on rental basis or through leasing, that is, on pay-per-use basis, this works out to be a far economical way to avail and use such assets and also retain the younger generation in the farms. Therefore, the concept of creating agriculture equipment banks is worth considering. This is one area which can be developed through PPP.
With the right incentives, there is huge scope of creating a new breed of agri-entrepreneurs. Creation of agri startups is also very much possible. From our ‘Sahaj’ experience (an initiative to bridge the urban-rural digital divide), I can say with enough confidence that there is no dearth of entrepreneurial talent in the villages.
We must not forget that India adds about one million to the workforce every month. It will not be possible for industry and services to absorb this incremental workforce. Thus, opportunities must be created in agriculture. The other fall-out from this will be arresting the growing trend of rural-to-urban migration which increases pressure on the cities.
In the next 30 years, we need to focus our energy in these three areas, and I see no reason why by 2047, India cannot become the country with the highest GDP. In fact, we will also figure among the top in all key macro and developmental indicators. But for that, we must begin now.
The author is CMD, Srei Infrastructure Finance
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