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    It is services not manufacturing that will see job creation

    Synopsis

    "More jobs will be generated as we have more and more investments, efficiencies, e-commerce and manufacturing. So you will see a lot of job growth"

    ET Now

    Mythili Bhusnurmath, Consulting Editor, ET NOW in a discussion with Ramesh Abhishek, DIPP Secretary, Anil Swarup, Coal Secretary and PK Pujari, Power Secretary on job creation opportunities in India. Edited excerpts


    Mythili Bhusnurmath: What can the DIPP do in order to ensure that in the remaining two and a half years of the government programmes like Make in India etc get the necessary traction. Are there any quick fixes that we can do in two and a half years where we will see the benefits also on the ground in these two and a half years?

    Ramesh Abhishek: You know all these essential elements of Make in India like creating a policy environment, having the suitable tax policies, skill development, ease of doing business so all that has to continue, you know that government is already spending massive amounts of money on building infrastructure that is something that will show results in the medium term that is going on.

    Skill development is another very critical area on which government is focussing on. The ministry of skill development has identified for the next six year till 2022 the kind of skills that are required in various sectors, the resources required and how that is to be done. Ease of doing business, the work will go on relentlessly, we need to do a lot, we are doing a lot but we will continue, we will continue to engage with the stakeholders, industry, continuously learn and then respond. I may also add here that in the next few years another program that will see huge amount of traction is Start Up India. We have the third largest ecosystem of start ups in the world and our young entrepreneurs full of ideas, innovation and technology are doing extremely good work. And the kind of enabling environment that our prime minister has promised to start ups in the country we are implementing that and we are very confident that in the coming years start ups will play a big role in Make in India and making our country proud of their entrepreneurship.

    Mythili Bhusnurmath: Just a question that perhaps I would like to ask three of you is as far as employment generation is concerned we have not seen any employment generation at all, most of the growth has been jobless growth. Now in your specific sectors is there scope really to create additional jobs? Is the public private partnership model dead?

    Ramesh Abhishek: There are many labour intensive sectors. Recently, the government gave a package of Rs 6000 crore and many non tax incentives for promoting the garment sector. This is a job generating sector. Another very important sector is leather and footwear sector, gems and jewellery. So government is making special efforts to see that these sectors get the kind of support and incentives they require.

    So far as the manufacturing is concerned, it is true that as we get smarter in manufacturing, industry 4.0 comes in there will not be too much of job creation but when you have growth in manufacturing then there is more growth of jobs in the services sector. So it is not that the manufacturing sector will see lot of job increase but the impact will be felt in the services sector.

    If you see the start ups the kind of aggregators or cars and hotel rooms and a lot of other services, e-commerce is providing lakhs and lakhs of jobs in the service sector, in the logistics sector, infrastructure is developing, the logistics is developing.

     


    Mythili Bhusnurmath: So you are hopeful that job generation will happen.

    Ramesh Abhishek: Absolutely. More jobs will be generated as we have more and more investments, efficiencies, e-commerce and manufacturing. So you will see a lot of job growth.

    Mythili Bhusnurmath: Power sector is a not a sector where we really expect to see job creation but you contribute by making power available, is there any other way really that the power sector can really make a difference to job creation?

    PK Pujari: I will give you one example, now Government of India has focussed on LED. We are basically substituting the normal bulbs with LED bulbs. As a result, the peak load has come down by about 15000-20000 megawatt. Somebody can say that by doing the LED or focussing on energy efficiency, you could have added capacity and set up another power plant. But setting up a power plant does not create long term jobs because it is only construction time and normally then normally power plants work is automated. When you have created a market for the energy efficiency in LED, look at the service sector what impact you have created.

    The LED assembly bulbs have come up, model companies are coming up, they are replacing the bulbs, they are replacing the streetlight, the service they are maintaining, all the contracts went in for five years. So actually you are creating jobs on the field, at the lowest level. So what we have done is that we have avoided investment of 20000 megawatt of power plant that is about to say you could have invested about Rs 80,000 crores but what we did is that created huge employment opportunity in the service sector at the lower end.

    So the nature is changing, when you look at what is the investment that is taking place, the nature is changing, you get into the transmission line, the maintenance, distribution, the maintenance, employment is created at the lower level. So that is where the focus is now. I do not see a large scale investment in capacity addition in the next two to three years. Large-scale capacity addition will continue but in the way we did in the last four years. Jobs will be created at the lower end.

    Mythili Bhusnurmath: Mr Swarup, you are perhaps the only Indian celebrating Mr Trump’s victory because he is very favourably inclined towards coal and he is not bothered about climate change. So any fears that we might have to wind down our reliance on coal, thermal energy are likely to go on the back burner. So are you quietly celebrating Mr. Trump’s victory.

    Anil Swarup: No, I am quietly celebrating what is happening in the coal sector in the country irrespective of Trump or no Trump. So we would not be really impacted by what Mr Trump says. We had planned it that way, we were planned for one billion tons of coal production, we are going ahead with that whether Mr Trump had won or someone else would have one.

    Mythili Bhusnurmath: But the reliance on thermal energy you do not see coming down?

    Anil Swarup: See, let us try and understand we have such a huge space available in terms of energy requirement in this county that though a lot of lot of space will be occupied by nonconventional energy like solar energy, you cannot wish away coal. I keep telling everyone you cannot wish away coal but our attempt will be to wash coal certainly.
    PK Pujari: Today out of 300 gigawatt of capacity, about 16-.6 gigawatt is of coal based. Now we committed in INDC in Paris saying that by 2030 we will have 40% of the capacity from the non fossil fuel. Now capacity you are looking at is about 600-650 gigawatt, out of that 40% do you see much capacity the thermal capacity one has to add. So we will be sticking to our commitment but there will be a need to add capacity both in the renewable and also in the thermal. And for energy security point of view, we cannot on long term depend on gas. So it has be the domestic supply of coal so there will be emphasis on coal but we will be going super critical so that the impact on the environment is minimum. Also, we will encourage large scale renewable to integrate into the system.

     


    Mythili Bhusnurmath: Mr. Abhishek, as far as cooperative federalism, competitive federalism etc is concerned, how much of it is just about ticking the boxes, because yes we passed the bankruptcy code so you get a tick in your ease of India doing business but nothing has really changed on the ground and it is not going to change unless you do something about judicial reform, enforcement of contract is something that contracts are not just worth the paper they are written on in this country unfortunately so what is one really doing to see that the states really follow through and they do what they say they are doing and it actually makes a difference to how people on the ground react?

    Ramesh Abhishek: This is a very important point. In last year there was 98 action points with the states on ease of doing business. This year we have evaluated them with the World Bank team on 340 points and we have seen a tremendous competition. Now what we had a meeting with the state government representatives a few days back and we are all by and large agreed that coming year, we have to evaluate states on the basis of public feedback because right now we have seen the changes they have made in laws, systems, processes, procedures, which was very important that we will continue to see. But in collaboration with the states because this is a collaborative effort, you know under the federal setup we have no business to evaluate states but it is being done only with the assistance and cooperation of the states.

    So ground level feedback, user feedback is very critical that has to be factored in, in what way it will be done is something that is worked upon but I can assure you that the states are aware, the states who are competing very hard. 12 states have got 91% and more score in that index because it is being done on a public platform so there is a lot of pressure on them actually that if you want to attract investment, investors are free to go anywhere whether it is a foreign investor or domestic investor so unless they provide an easy climate and of course there are a lot of other issues, infrastructure, law and order etc so the states are extremely conscious and they are competing very hard among themselves to attract investors. I do not think they have a choice.

    Mythili Bhusnurmath: Do you see any kind of correlation between what is happening in the power sector in different states and how the states are performing on the ease of doing business because you normally expect that power is a very critical part of investment in any state, so is there any correlation that the states are well ranked, Andhra, Telangana etc are there states where the SEBs have done a great deal or are they not, is there no correlation really?


    PK Pujari: No, there is a direct correlation and if you look at all the states who are in the high ranking on the ease of doing business their power sector, the system operates quite efficiently, they are power surplus, the availability and reliable and quality power, I am not talking about the cost. Cost could be high but then that is a separate issue altogether and there is also easy, I mean it is not very difficult to get the connection so there is a direct correlation. And since power is one of the major requirement or raw material for setting up any industry I think this is generally expected and it is availability, reliable and quality power those are the important ones.

    Ramesh Abhishek: As a matter of fact you know we have also discussed with the states that some of the parameters next year must be the quality of infrastructure that is available in the states, quality of electricity, number of hours, all the quotients and of course the investment on skill development and all that.

    We are working out with them how those can be factored into these parameters of ease of doing business. One more thing we are planning to do is that even the process of giving licences, renewals, all that is taking lot of time in so many states so we also planning to incorporate all that.

    Mythili Bhusnurmath: As far as coal is concerned, the first question that occurs to you when you talk about coal, sugar, industries is why do not we denationalise coal because we thought we have moved out of socialist days in 1991 but this is a huge issue. Not only are we still publicly owned but even the prices are not left to be determined by market forces. When are we going to see that change?

    Anil Swarup: You know you have used a big term denationalise, much before that there are many other things to be done. First we have to go in for commercial mining, let Coal India do what it is doing and let there be commercial mining as well parallely so that some competition could emerge. I am a great believer in going step by step because as a student of history I have realised that all revolutions lead to dictatorship, even French revolution did that. So let us go step by step, we have demonstrated in coal that you can actually move at a very fast pace and change the scenario which we have done. And let me come back to the issue of states that they were discussing. In my understanding centre is a fiction, all action happens in the state and people ask me to give one reason why coal happened in this country, it happened because I did not hold a meeting with the state governments in Delhi, I traveled to each of the states once in every two months, sat with the senior officers there, conveyed a value proposition to them, to me that is critical.

    According to me states have a very important role to play and we have to go down to the states to make things happen there.




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    (What's moving Sensex and Nifty Track latest market news, stock tips and expert advice, on ETMarkets. Also, ETMarkets.com is now on Telegram. For fastest news alerts on financial markets, investment strategies and stocks alerts, subscribe to our Telegram feeds .)

    Download The Economic Times News App to get Daily Market Updates & Live Business News.

    Subscribe to The Economic Times Prime and read the Economic Times ePaper Online.and Sensex Today.

    Top Trending Stocks: SBI Share Price, Axis Bank Share Price, HDFC Bank Share Price, Infosys Share Price, Wipro Share Price, NTPC Share Price

    ...more
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