The growth of business conglomerates like the Ambanis and Adanis should not be confused to signify an overall growth for the nation or the well-being of its people. While India’s rich wallow in wealth, tens of crores of poor are under-nourished and struggling in their lives. A reason why the claim that India is set to become the world’s third largest economy in another three years is taken with a pinch of salt. The realities on the ground tell a grim tale. This sentiment is also reflected in the observations from the World Bank this week, which cited that India’s global trade in goods and services has been declining in terms of GDP percentage in the last 10 years. India is losing out even to small nations like Bangladesh and Vietnam as low-cost manufacturing hubs.
India’s share in global exports of apparel, leather, textiles and footwear grew from less than one per cent to 4.5 per cent from 2002 to 2013. Instead of further growing, this declined to 3.5 per cent by 2022. By contrast, Bangladesh’s share grew to 5.1 per cent and Vietnam’s to 5.9 per cent by 2022. It is also true that India gained majorly in sectors like pharmaceuticals, due mainly to the reputation that some private sector entities gained in recent years. However, in labour-intensive sectors like garments, Bangladesh and Vietnam could do better than India in exports. Vietnam recently overtook China to become the largest exporter of readymade garments to the US, a field in which Bangladesh too has been having high stakes. Growth in such sectors also means creation of job opportunities to millions, especially women. The World Bank points out that direct employment related to exports fell in India from a peak of 9.5 per cent of total domestic employment in 2012 to 6.5 per cent in 2020. India’s export sectors are increasingly capital intensive, though, and unable to absorb the millions of jobless people, it has noted.
A nation does not grow in economic terms if it simply produces and consumes. Export boosts economic growth and, at the ground level, creates jobs both in the industrial and agricultural sectors. Manpower is necessary to produce things especially in agriculture and the SME sectors. Vietnam has a population of less than 10 crore, but the value of its total annual exports is of the order of nearly $360 billion, while India with its population bulge of 1.4 billion registers an annual export valued only at $780 billion. Manpower is under-utilized here. The economic growth for the West is based on its technological excellence. Alternatively, for nations like India, use of manpower in productive sectors is important. It helps people fill their belly and simultaneously ensures economic growth.
