The Indian government is poised to make significant announcements regarding job creation in the upcoming budget for the fiscal year 2025-26. With a sharp focus on boosting employment, the Confederation of Indian Industry (CII) has urged the government to implement additional measures aimed at fostering job opportunities. This initiative is particularly crucial as India boasts a young population, and it is essential to harness this demographic dividend for economic growth. The CII has proposed a comprehensive seven-point agenda that includes the introduction of an Integrated National Employment Policy, support for labor-intensive sectors, and the establishment of an International Transport Authority to promote massive employment generation.
Internship Programs in Government Offices
India’s average age is just 29 years, making it one of the youngest countries globally. By 2050, an estimated 133 million people will join the working-age population. The CII has suggested that the government consider launching internship programs in government offices in rural areas targeted at college-educated youth. Such initiatives would bridge the gap between education and skill development, providing short-term employment opportunities in government offices. This program could enhance the effective implementation of various rural programs and government initiatives by increasing the available human resource pool.
Integrated National Employment Policy
The CII has also recommended introducing a new provision under Section 80JJAA of the Income Tax rules to foster job creation. This new provision should continue as a deduction under Chapter VIA of the gross total income, remaining available even if taxpayers opt for the concessional tax regime. Additionally, the proposal for an Integrated National Employment Policy aims to consolidate various job creation schemes currently implemented by different ministries and states, ensuring a more focused and effective approach to employment generation.
Boosting Productivity for Sustainable Growth
Chandrajit Banerjee, the Director General of CII, emphasized that while increasing employment is critical, it is equally important to enhance productivity within the Indian economy. The Incremental Capital-Output Ratio (ICOR) in India needs to be lowered from its current level of 4.1. Establishing benchmarks to measure productivity is essential. Furthermore, the central budget could involve the formation of a specialized committee tasked with conducting an in-depth analysis of this issue and recommending actionable measures to boost productivity while creating jobs.
Conclusion: Towards a Sustainable Employment Ecosystem
With strategic initiatives and an unwavering focus on creating job opportunities while enhancing productivity, India stands at the brink of transformative growth. By leveraging its youthful workforce and implementing an Integrated National Employment Policy, the government can create a robust employment ecosystem that not only addresses current challenges but also lays the foundation for sustainable economic development in the years to come.