The first budget in the second inning of the Modi government sets India’s aspiration to become a $5 trillion economy in the next few years – an 85 per cent increase over the current $2.7 trillion. A new India with an accelerated economic growth is the vision portrayed by the Finance Minister in her budget which outlined the policy direction the government intends to take.
The budget seeks to provide an inclusive roadmap taking along both rural and urban India through its focus on infrastructure creation, extending the digital network and strengthening the MSME footprint across the country. To achieve this vision, a key support required will be developing India’s talent pool with the requisite skill set, and expertise in both numbers and quality aligned to the requirements of industry.
While traditional skill sets for construction, logistics, manufacturing will be required for development and maintenance of roads, highways, ports, railways, housing, etc., specialized skill sets will be needed in extending the digital footprint through Bharat Net, covering all panchayats and providing digital services across the country. Skills for new age industries like AI, IOT, 3D printing, robotics are to be provided across the country through the ongoing Pradhan Mantri Kaushal Vikas Yojana (PMKVY) with a 6 per cent increase in allocation over last year.
Quality of education in the country has been a concern as observed from the latest Annual Survey of Education Report. This has sought to be addressed through the unveiling of a new National Education Policy which is expected to transform Indian education system and make it comparable with the best in the world. The allocation for school education has been increased by around 14 per cent over last year.
In higher education the key transformational focus has been on research and innovation which is a critical component for global ranking. An allocation of Rs 400 crores (last year allocation was Rs. 129 crores) has been made to support transforming select Indian higher education institutions into world-class institutions. This supports the intent of attracting global new-age manufacturing industries to India through fiscal incentives announced in the areas of Semi-conductor Fabrication, Solar Photovoltaic cells, Lithium storage batteries, Solar electric charging infrastructure, computing hardware, etc. as well as making India the global hub for electric vehicle manufacturing.
The budget has given due importance to research and innovation through the proposed establishment of National Research Foundation to fund, coordinate and promote research. Research funds available with various ministries is proposed to be assimilated into the fund with an aim to strengthen the research ecosystem and ensure that research thrust areas are aligned to national priorities.
The proposed “study in India” programme which aims at attracting foreign students to join Indian higher education institutions will not only provide the required diversity, an important requirement for global ranking, but also ensure that institutes offer course curriculum aligned to global industry needs, quality faculty and infrastructure/ facilities. It has been acknowledged in the budget that regulatory systems governing higher education institutions need comprehensive reforms in terms of autonomy and improved governance for which setting up a Higher Education Commission of India has been proposed with the required legislation being drafted.
The budget provides a roadmap for achieving India’s vision of inclusive economic growth and seeks to address India’s need for a talent pool having the requisite skills and expertise required in an ever changing scenario of disruptions on account of technological innovations. The focus on new age skills in PMKVY and plans for making institutions of higher education research & innovation oriented is a step in the right direction.
However, the key challenge has been in implementation of such measures and ensuring that the youth of the country are adequately skilled and trained that make them attractive to both domestic and global enterprises on account of their talent. Only when these measures are successfully implemented in a time bound manner, will India realise the full benefit and impact of its demographic dividend which is the most important enabler for reaching its aspired economic growth.
The author is a Partner at Deloitte India.