The health and well-being of an economy, the very basics of demand and supply as also small savings and tax revenue, all of these are more often than not sustained by the salaried class. The stagnancy in this segment—the non-creation of regular jobs entailing a kind of socio-economic security—should be an area of natural concern.
The recent Systematic Country Diagnostic draft report of the World Bank draws our attention to India’s embarrassingly low ranking. Embarrassing not just because it again highlights the deep disparities and wide inequalities, but also because India lags behind its smaller neighbours, Bhutan, Bangladesh, Sri Lanka and Maldives; as also Brazil, Mexico and South Africa. In what appears truly depressing, the World Bank projections suggest India has a chance of becoming a real middle-class economy only by 2047.
That’s a long wait. As of now, we are a lower-middle class economy, never mind if some of Asia’s and the world’s richest are Indians. Only when the ranks of the Indian middle class burgeon, pushing up per capita income levels and other meaningful averages like purchasing power, can a measure of economic democracy be said to exist. The latest Economic Survey tells us per capita income will grow if the GDP grows by 6.5 per cent year-on-year, and we may climb on to the high table and become an upper-middleclass economy by 2020s.
The World Bank does not think so. It has additionally raised concern about a nutritionally stunted, unskilled Indian population not qualifying for either blue- or white-collar jobs. The rise in EPFO numbers, cited by a new SBI report, is clearly no balm. It only signifies old jobs getting regularised, not the creation of new jobs. The government needs to decide fast on the path to choose: whether to step up the creation of regular salaried jobs or push through labour laws with easy hire-and-fire clauses to attract investment and new business. Either way, it seems to be a long haul. In the meantime, there’s always self-employment, which implies survival, not growth.