Reserve Bank Deputy Governor,Subir Gokarn,today said the country is expected to benefit from a rise in its young working population over the next decade but migration of workers from the farm sector to industry and services is essential to sustain high growth.
“To achieve high inclusive growth,there is a need to facilitate the transition of workforce from agriculture to services and industrial sectors…if the country is growing,that is mainly not because of agriculture,what is important is services and industrial sectors, Gokarn said speaking at the Skoch seminar here.
The Government has projected a GDP growth of 8.5 per cent in the current fiscal as compared to 7.4 per cent in the last fiscal.
Over the next one decade,around 120 million young people are likely to join the country’s working population,much higher than that of China,which will give an impetus to economic growth,Gokarn said,adding that each year nearly 10 million people are likely to join the nation’s workforce.
However,he cautioned that the country needs to expand the capacity and capital intensity in the manufacturing and other related sectors to accommodate the newly-joined workforce.
Gokarn said that while the manufacturing output has risen over the past two decade,there was no corresponding rise in the number of factories or workforce.
“If the same number of workers produce more,then that means that new workers who are coming in 10 million per annum are not getting a chance,” Gokarn said.
Also,the country needs to shape the right policies for relocation of labour-intensive manufacturing from China to India to prepare for high growth in the long-term and incorporate labour flexibility,skill-matching and safe working environment to the workers to ensure healthy growth,he said.