MARCH 30, 2003
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Q&A: Kunio Sebata
The President and CEO of the $3.8-billion Hitachi Home and Life Solutions Inc tells BT Online about what it's like to operate independently in India, the company's past relationship with the Lalbhai Group in the air-conditioner market, its faith in joint ventures and its current plans for India.

Q&A: Eran Gartner
As Vice President (Operations), Bombardier Transportation, Eran Gartner, outlines what would make his company such a hot pick to build Bangalore's mass transit system. It isn't just about creating a network and vanishing, he claims, it's also about transferring modern technology to the local operations.

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Business Today,  March 16, 2003
The End Of Work
Jobless growth can only spell an all-round rise in social tensions in times to come.

A large section of India's youth faces a jobless future. Yet much of the current discourse on economics has ignored this burning issue while focussing on topics like globalisation, liberalisation, privatisation and so on. Right through the 60s, 70s and 80s, all economists would debate and discuss how job opportunities could be created efficiently and whether or not policy planners should blindly adopt labour-intensive technologies.

Even today, politicians of all ideological hues talk about the need to create more employment. What has been this country's track record? Pretty pathetic, to say the least.


A glance at the section on labour and employment in the latest Economic Survey confirms one's worst apprehensions. It has been pointed out that the "decline in the rate of growth of employment in the 1990s was associated with a comparatively higher growth rate in GDP, indicating a decline in the labour intensity of production". The 55th round of the quinquennial survey of the National Sample Survey Organisation goes even further, stating that the annual rate of growth of employment declined from 2.7 per cent between 1983 and 1993-94 to a mere 1.07 per cent between 1993-94 and 1999-2000. During these two periods, the overall rate of growth of population came down from 2 per cent per year to 1.95 per cent.

The employment elasticity of output declined from 0.52 to 0.16 between these two periods. This decline cut across virtually all sectors of the economy-there was a near-stagnation of employment in agriculture in the second half of the 90s-the exceptions being transport, financial services and real estate. Shorn of jargon, what is apparent is that while the rate of growth of population in India has come down, the number of new jobs created in the economy has declined even faster because of the growing use of capital-intensive technologies.

Data available from 939 employment exchanges in the country indicate that at the end of September last year, the number of job-seekers (all of whom are not necessarily unemployed) stood at 41.6 million, of whom roughly 70 per cent were educated up to at least the 10th standard.

According to statistics compiled by the Directorate General of Employment and Training in the Ministry of Labour, the total employment level in the public sector came down for the fifth year in succession: from around 19.56 million at the end of March 1997 to 19.42 million the following year, a little lower the year after that to 19.31 million in the year 2000 and 19.14 million in 2001.

The loss of jobs in the public sector over the years has hardly been compensated by growth of employment opportunities in the private sector. Employment in the organised private sector came down from 8.75 million in 1998 to 8.69 million the following year and 8.65 million in 2000. Between 2000 and 2001, the number of new jobs created by the organised private sector rose by a mere 6,000.

Significantly, these figures pertain only to the organised sector that accounts for barely 9 per cent of the total employment in the country's economy. Those who are optimistic believe that the number of self-employed would grow significantly in the years ahead as more people shun contractual jobs with uncertain short tenures.

This phenomenon of jobless growth is not confined to India. It is, in fact, an international trend of growing dimensions. In his book entitled End of Work (Penguin, 2000), author Jeremy Rifkin wrote: "While earlier industrial technologies replaced the physical power of human labour, substituting machines for body and brawn, the new computer-based technologies promise a replacement of the human mind itself, substituting thinking machines for human beings across the entire gamut of economic activity." He added that the economic fortunes of most working people continue to deteriorate amid the embarrassment of technological riches, the benefits of which reach only the elite. So don't be surprised if social tensions among the youth rise in the time to come.

The author is Director, School of Convergence at IMI, New Delhi, and a journalist.
He can be contacted a