The Edge Factor

‘Make in India’ – Vision or Hypermetropia?

Posted by CGN Team

A vibrant eco-system that can continuously generate skilled and employable people in a growing manufacturing sector is needed to realise the ‘Make in India’ dream.

The ‘Make in India’ drive of PM Narendra Modi is an ambitious program to transform India into a global manufacturing hub. This will give a boost to the Indian economy and, very vitally, provide jobs to the 110 million people expected to join the workforce between now and 2020. While the industry is watching to see how much the Government actually reforms archaic laws and regulations, it is equally concerned about the lack of skilled workers who are essential to convert this dream into a reality. In 2011, a Wall Street Journal article stated that 75% of technical graduates and 85% of general graduates in India are unemployable. So, what can be done and what action is being taken?

The source of the problem, says the WSJ article, is the lack of reform in the heavily regulated Indian educational system. So, even as the demand will be for a functionally skilled workforce, the system is still providing a “workforce with a degree”. Often, the syllabus for that degree is archaic. This was a problem faced by the IT industry at the turn of the century. Their response was to simply pick up bright people from colleges, ignore what they learnt there, train them for a year and put them to work. But this is a huge waste of time and resources in an economy that can afford neither.

The ‘Make in India’ program will create a demand for skilled workers, managers and business leaders. Naturally, given that it is about ‘making’, there will be an increased demand for skilled people in the field of operations, manufacturing, supply chain and retail. Failure to create a pipeline of talent will mean missed targets and wasted capital and time. Wait too long and India’s young workforce will age and slowly settle back to wasted lives based on subsistence incomes. A few decades later, the country will go broke with social costs.

Driving change in this sector are some interesting developments. Firstly, it is the scale and intensity of the drive by the National Skills Development Corporation (NSDC). Set up as part of the national skill development mission, NSDC works to establish standards and fund educational organisations across the country. It has a target of addressing 30% of the national target of skilling 500 million people by 2022.

Secondly, there is the emphasis on the rejuvenation of the Industrial Training Institutes (ITIs). For some time a set of moribund organisations, the ITIs can play a vital role in an industry where on an average 10 technicians are needed for every engineer. The PM has correctly noted that this is as much a positioning exercise as it is a change in curriculum and administration.

Finally, there is a need to create high quality technical leaders if what is made in India is to be globally competitive. Strangely, this has been the area of least reform or even the intent to reform. Everyone agrees that there is a need for problem solvers and leaders, not rote learning. However, apart from the creation of numerous universities and expanding capacity, little has been done to change the quality of education in the country.

Yet, people still seem to find a way. The capability to create a core group of capable and imaginative leaders has been quietly taking place. An article by Vijay Govindraj and Gunjan Bagla, in the HBR, describes as myths that India and China are merely meant for outsourcing software, low-end and peripheral work and definitely not design work. So, as has been the case in the past, the people in the country aren’t going to wait for the Government to bring about change and will continue to push on. But to realise the goal of ‘Make in India’, it is necessary to create a vibrant eco-system that can continuously generate relevant skilled and employable people in a growing manufacturing sector.