Reforms, Investment and Employment


India needs to finalize and announce much-needed reforms, which in turn would drive badly needed investment and generate employment for the youth of this country.

I do not understand why it is so hard for the political parties to understand. May be the vested interests over-rule reform-oriented policies, but surely everyone is keen on ensuring employment generation as that would generate income and reduce social disparities going forward ?

Apparently not.

Reforms are required urgently in the area of multi-brand retail, insurance, pension funds management, fuel price de-regulation, and many other areas. Markets should be the ultimate determinant of prices and policies, but in India the adoption of even agreed policies is skewed to say the least. Combined with the onslaught of scandals and sensational news coverage of almost anything out there, it becomes difficult to understand where the country is going.

Positive reforms will automatically drive big investments, given the size of the Indian market. Especially the consumer market is huge in India, and is not getting serviced in several areas as we all know. Foreign investments are badly needed in newer areas (mentioned above), and those investments won’t come in if there is uncertainty in the policy front and the governance mechanism is not working. The only thing foreigners can be sure of is the justice system, which is increasingly proving that it is a world-class and fair system of delivering justice.

The other reason why foreign investments are required is to enhance the productivity and efficiency – our systems do not scale well and a Walmart or Carrefour could bring in high levels of supply chain efficiency and technology adoption. Let us not forget that we have to consistently strive to employ a million youngsters every year in retail industry and other industries, and it is imperative to provide people with opportunities to find jobs. Will the political parties provide avenues for jobs to youngsters – they also need to recognize the importance of these new voters, who easily constitute more than 50% of India’s population currently.

Gainful employment is very critical in ensuring the growth of a consumption economy. India has already shown over the past decade that its consumption could grow dramatically, driven exactly by the young crowd of 18 to 28 years of age. These are highly productive people who could be leveraged to grow the GDP of the country at a 10% clip over the foreseeable future.

So, let us support government’s efforts to implement the reforms in a viral manner over the social networks. Blogging does not get much return, but a facebook effort could be highly productive in collecting the combined focus of the young crowd of India towards facilitating and pushing the reform agenda of the government. People have to raise their voices for reforms and higher levels of productive employment, and then the government and the political parties will see the point.

Let us push ourselves to create an impact for positive reforms.

Cheers,

Vijay Srinivasan

17th June 2012

Mumbai

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