Unless the weaknesses in education and skill development are recognised and remedied, India is in danger of moving towards becoming a two-tier economy where ‘haves’ sitting in gated communities will be serviced by the ‘have-nots,’ warned former Reserve Bank of India Governor and noted economist Raghuram Rajan.
This, Mr. Rajan said, would not be socially stable or desirable in the long term. He was speaking at the global digital summit, #FUTURE, which concluded here on Friday.
Mr. Rajan observed that though technological change might be slower than expected, India could not afford to be complacent. “Because, unlike the west, we don’t have jobs to loose because we don’t have those jobs in the first place. We need far more jobs,” he said.
India needs to build a lot more world-class higher education institutions and bring back some of the exported talent to populate those institutions. “We are not as global as we should be even now, and we need to join the global supply chain sooner than later,” Mr. Rajan said while batting for a focused tariff regime facilitating that participation.
Citing the example of Kerala, he said that the State could not have a better advisor than Geetha Gopinath. “But it is important that the State listen to people who talk about how to create a better position in the global trading system,” Mr. Rajan said.
He also urged India to embrace technology and competition while debating on key aspects like who owns the data and should the data be owned abroad or can be owned domestically.
The government must help Indian industries flourish by creating easy paths to incorporation and funding. One of the big lacunae in the country is the lack of risk financing, forcing companies and start-ups to incorporate outside leading to their ownership by foreign entities.
India cannot afford to miss out on Artificial Intelligence and robotics revolutions. “The world is changing very fast. We need not be a victim of that change but can embrace it and participate fully on our terms. We have to be leaders rather than followers. The world is coming to India, and we have to be prepared,” Mr. Rajan summed up.
