Even as India continues to record impressive economic growth, extreme poverty and inequality remain a major challenge that haunts the growth story. As per the National Sample Survey Organisation, average income of the richest is 12 times that of the poorest in the urban areas in 2000, increasing 15 times in 2012. The underlying cause of this is the failure of current economic development patterns to integrate all segments of the society. These patterns fail to provide jobs and benefits to the poor further exacerbating the persisting disparities. The quality and distribution of India’s GDP growth rate are structurally “disequalising” [i] and destablising. Evidence across time and space, especially from Nordic countries, has illustrated that reduced poverty and relative even distribution of income leads to sustainable and strong economic performance. On the contrary, high levels of inequality have resulted in volatile economic performance and social instability like in the United States, Greece or Spain.[ii] There is, therefore, an urgent need to put in place systems attacking poverty and inequality at its roots and promoting inclusive economic development.
Creation of green and inclusive decent jobs for all is one way to facilitate such development. A supply of jobs enhances the productive capabilities of people laying the foundation of prosperity and social cohesion.[iii] Development policy in the last decade, guided by the Millennium Development Goals (MDGs), has failed to create inclusive economic growth and jobs. Chang (2010) argues that MDGs lacked a strategy to promote necessary transformations that nurture productive capabilities. He describes the MDGs vision as one that of ‘development without development’.[iv] Moreover, donor countries have expressed that the MDGs give all attention to social outcomes, ignoring economic transformations. As a result, official development assistance (ODA) is becoming concentrated on health and education with the economic sectors gradually neglected. For example, the share of ODA commitments to the production sectors in LDCs fell from 48% in the period 1992-1994 to 25% in 2006.[v] Moreover the overemphasis on meeting social outcome targets has led to national governments splurging on dole out schemes that have increased inflation and raised deficits, further slowing growth.
This poor economics of the last decade coupled with resources pressures of today owing to demographic and urbanization growth is likely to trigger wars, political and social unrest within and across borders. For a country that is adding 12 million to the workforce each year and millions moving to urban areas from a crisis-ridden agricultural sector [vi], India will have to adopt an inclusive and green growth development agenda as it advances into the post 2015 framework. Components of this should include macroeconomic, environmental and industrial policies that foster structural changes, inclusive job creation, socially relevant investments and sound social and labour market policies.
Critical Reforms to Facilitate Job Creation In India
The post 2015 framework must therefore create enabling conditions for this and set out an explicit goal on productive green jobs unlike the insufficient emphasis placed on the subject in the MDGs. This goal must be simple with agreed parameters that can help national level stakeholders define targets suited to the needs of their countries.[vii] This future framework must also place emphasis on ‘means’ enabling the achievement of desired social and economic outcomes rather than the ends themselves. Therefore, support for social development must be complemented by measures that enhance employment in order to promote sustainable human development. A focus on decent and green jobs is therefore critical in the short- term to curb the dramatic effects of a prolonged jobs crisis and in the long term for making economic growth more sustainable, inclusive and equitable. [viii]
[i] Mishra, P. (2013) Which India Matters?
[ii]ODI (2013) Recasting MDG 8: Global Policies for Inclusive Growth
[iii] International Labour Office (n.d) Jobs and livelihoods at the heart of the post-2015 development agenda
[iv] ODI (2012) Inclusive Growth and a post 2015 framework
[v]ODI (2013) Recasting MDG 8: Global Policies for Inclusive Growth
[vi] Mishra, P. (2013) Which India Matters?
[vii]International Labour Office (n.d) Jobs and livelihoods at the heart of the post-2015 development agenda
[viii] UN System Task Team on the Post 2015 Development Agenda (2012)