In the recent past, economists have dramatically changed their view about the role of population in economic development. As a result of this shift in their view from that of pessimism to optimism, we often come across political leaders gloating about India’s young and growing population and its potential to add about 2 percentage points per annum to per capita GDP growth over the next two decades. This glib talk that is further flavoured by an argument that the share of the working-age population in the total population of India is likely to continue to increase until about 2035 to 2040 creating a strong impulse for economic growth is sure to warm the cockles of the poor voter’s heart on the street.
Before getting into the nitty-gritty of demographic dividend, let us first look at what this is all about: According to the 12th Five Year Plan document, “One hundred and eighty three million additional income-seekers are expected to join the workforce over the next 15 years”, which means that roughly 12 million people would be joining the workforce every year. And by 2030, our workforce would be larger than that of China. The expectation is that as our workforce thus swells up, they would find job and earn money and spend it, our economy too would do well. And this is what the expected demographic dividend that India is hoping on to achieve—an annual growth rate of 10 percent in GDP.
But all this talk about our demographic dividend and its supposed benefits is put forward from the point of supply of labour alone. No one is talking about it from the perspective of demand for labour. And therein lies the catch, for in a well-functioning economy with competitive product and factor markets, there is no guaranty that demand for labour would match supply. Secondly, today’s technological improvements have substantially reduced the demand for human labour in almost every sector of the industry and even if any demand arises it is only for highly-skilled labour.
It is no doubt commonsensical that population growth tends to result in fast economic growth but it must be borne in mind that it happens only when the government of the day creates conducive environment for investment and growth in employment. Else, as it was witnessed in the 60s and early 70s in India and China rapid growth in population can stir up social tensions in want of opportunities to earn livelihood.
In this context, it is worth recalling what Prof. Avinash Kamalakar Dixit, from Princeton University—whose current research interests centred on ‘institutional economics’—said: “there is a great danger of India wasting the demographic dividend for two reasons: The poor quality of education, and the low rate of female participation in the labour force.”
This straightaway takes us to the ‘not-so-impressive’ scenario prevailing among Indian universities. Right from the way the vice-chancellors are selected for our public universities to recruiting faculty and the commitment of faculty to the cause of education, to the appalling faculty-student ratio speaks volumes about “the credibility of universities in advancing the spirit of inquiry, the spirit of curiosity and the spirit of excellence among the young students and scholars.” No wonder if the current style of recruiting faculty by the universities — their giving a go by to meritocracy by hankering around cast lines—has created resentment among student community.
It’s an irony that universities that are supposed to widen the canvas of knowledge by maintaining high standards are instead granting ‘grace marks’ to let out its students with a pass certificate. The result is: you have graduates all around but no eligible candidates for hiring by the industry.
Interestingly, Prof. Devesh Kapur from University of Pennsylvania in a recent interview to The Hindu made some candid observations that merit the attention of every well-meaning citizen of this country. Wondering about the role of scholars and faculty in the universities funded by the public money, he has thrown an innocuous question at the universities to ponder: “Should it be activism or research?” He then asserts that “research is not a part-time activity.” He goes on to say, “Din bhar morcha kiya, raat ko do ghanta kaam kiya — engage in protests through the day, do precious little at night”, which he asserts that leads us to nowhere for, “good research requires tremendous commitment over a sustained period.”
Lamenting at the evil that started with JP’s Movement in the 1970s, which was considered nice then, that spoiled universities in north India—as though universities in south are any better—he said that our universities, instead of becoming broad-based elite institutions solely engaged in “introducing students to a world of intellectual responsibility and intellectual discovery”, have today become highly political and parochial.
Perhaps to highlight the widespread parochialism in our universities, Prof. Kapur, drawing our attention to Calcutta University, states that as against Ramans and Krishnans of yester era, today there are only Bengalis in every department. Perhaps, same would be the case with all state universities. For that matter, with the growing regionalism, the position has only further deteriorated: for instance, in Andhra University, as against Dutts, Sundarams, Hussains of early independent India, its departments are today chaired mostly by people hailing from the districts around it. And the net result of all this narrowness is: instead of fanning the open-mindedness among the students when their minds are in a formative phase, we are paving the way for ghettoised living, said Prof. Kapur. And this growing parochialism and the resulting ‘Us versus Them’ syndrome had simply made universities as platforms for nurturing political ambitions.
Except for the few elitist institutions like IITs, and islands of excellence here and there, our university system as a whole is plagued by this malady, malady of mediocrity, and yet no political party in the country is ready to question this growing malaise, though a dysfunctional public institution is known to cause social injustice.
And if this grows unchecked, the demographic dividend that is supposed to cause economic growth may instead lead to disaster, for without good public institutions even great wealth can become fragile.
Now, the real challenge is: Is our leadership willing to raise to the occasion and stem this rot at least now? Will our universities mend their ways and work towards supplying employable students to the market? Will they do systematically what they are supposed to do efficiently and effectively—educate the youth for the future? Will the industry orchestrate its investment plans in such a way that its growth plans zero in on labour? It is on the answers to these questions that the realization of anticipated dividend squarely rests.