Can Job Creation Help South Asia to Escape Global Economic Crisis?

Can Job Creation Help South Asia to Escape Global Economic Crisis?

Can Job Creation Help South Asia to Escape Global Economic Crisis?

JOBS, JOBS, AND JOBS

October 28, 2009 - In South Asia more than 150 million people are expected to enter the prime working age population over the next decade. Creating jobs for them will contribute to growth, equity, and peace in the region.

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South Asia's recent rapid growth must be more inclusive to address the dichotomy of the growing gap between leading and lagging regions.

GLOBAL ECONOMIC CRISIS

South Asia has recently attracted global attention for its rapid growth. “Notwithstanding this impressive progress, South Asia remains home to a large number of poor,” saidEliana A. Cardoso, Chief Economist for the South Asia Region, World Bank. “Their welfare has become more precarious in this global economic crisis. The poor countries have little economic cushion to protect vulnerable populations from this crisis, which was followed closely on the heels of a global spike in food prices.

According to a recent World Bank report, Accelerating Growth and Job Creation in South Asia, timely and relevant in the context of the ongoing global crisis, there is a broad consensus that South Asia must continue to grow rapidly and possibly faster to eradicate poverty more comprehensively than in the past. “There is also an emerging consensus that this growth must be more inclusive to address the dichotomy of the growing gap between leading and lagging regions,” said Cardoso.

SOUTH ASIA NEEDS TO GROW ON MULTIPLE FRONTS

Rural markets and lagging regions have huge untapped potential. It has increased with expanding role of the services sector. Combined with an improved role of unorganized and organized manufacturing and services has eroded steadily the overall share of agriculture incomes in rural areas.

Rural households today depend on more than one source for their incomes. Temporary rural to urban migration has increased incomes, which otherwise depended on agriculture. Other individuals within the household have increasingly involved in home-based work. This diversification helps stabilize household purchases.

HOW TO GROW?

Sustaining high growth rates is not easy. “Growth results from complex interactions between policies, institutions, geography, and leadership. The question is can South Asia achieve both high and inclusive growth?” said Cardoso.

The factors that can contribute to high and inclusive growth are labor mobility, more jobs, increased productivity, skills and education, and resolution of internal conflict. Inclusive growth is not about balanced growth but shared opportunities. Spatial disparities in growth are inevitable when growth accelerates and countries make the transition from being an agricultural to an industrialized economy.

HOW TO CREATE JOBS?

The key asset of South Asia is its people. “South Asia has a young population and the lowest female participation rate in the labor force. The demographic dividend will result in more workers entering the labor force in the future,” said Cardoso. Hence, the region must exploit the unparalleled advantage of demographic dividend that could structurally transform South Asia economically and socially. The structural transformation – the shift of capital and labor away from low-productivity (traditional agriculture) and into high-productive sectors (modern agriculture, manufacturing, and services) – is needed to accelerate growth and create jobs. Labor supply growth is 2.3% per annum in South Asia, above the global average of 1.8%. The increased labor force can contribute to additional growth.

Can Job Creation Help South Asia to Escape Global Economic Crisis?

GROWTH AND EQUITY

Job creation is good for growth and good for equity. “South Asia’s young demographics suggest that its labor force is growing faster than its population, and millions of new entrants will not be able to finds jobs,” said Ejaz Ghani, Economic Advisor for the South Asia Region, World Bank. More than 150 million people are expected enter the prime working age population over the next decade. “Creating jobs for them will contribute to growth, equity, and peace in the region.”

MORE PRODUCTIVE JOBS

A key challenge facing the region is whether it can create enough good jobs to convert this large population into a productive asset. The region with weak infrastructure has also constrained the expansion of the manufacturing sector, thereby adversely affecting both growth and employment creation.

WHAT WILL CREATE MORE PRODUCTIVE JOBS?

First, rapid growth is essential to create more and better jobs.

Second, restrictive labor laws need to be reformed to remove barriers to creating jobs in the formal sector. Labor market reforms should be accompanied by improved social protection.

Third, for South Asia to accelerate growth and create good jobs, it will require much better training and education to produce more skilled labor.

HOW HAS SOUTH ASIA FARED IN CREATING JOBS?

In terms of numbers, South Asia is one of the fastest job creators in the world,” saidGhani. The largest job creation in South Asia is in the services sector, but the manufacturing sector is also showing progress. South Asia now needs to generate non-agricultural jobs in lagging regions of South Asia, where 500 million people live.

The key link between growth and inclusiveness is creation of good jobs," said Ghani. South Asia is already undergoing a major structural transformation based on rapid growth of services and manufacturing. The GDP share of agriculture is shrinking fast. As the agriculture sector modernizes, and farmers move up the value chain, and make better use of retail networks, storage facilities, and transportation facilities from the fields to the markets, more jobs are likely to migrate from agriculture to other sectors. This trend is likely to continue in the future, although the growth rates in both manufacturing and agriculture could be accelerated.

EAST ASIA OF 1970S AND 1980S

The recent history of South Asia raises hope for the region. Growth has been rapid, and some parts of the region are beginning to resemble the economies of East Asia of the 1970s," said Ghani. Yet this growth has not had a matching impact on employment, so the incidence of poverty remains large and, despite some small downward movement in recent times, at record levels by global standards. “This also means that the associated with poverty, such as low literacy rates, malnutrition, and poor working conditions, persist.”

It is therefore important for the countries to turn their attention to spreading the benefits of growth to larger segments of the population. While the initial impulse is likely to result in government programs and subsidies, the region has to rely on private industry to create jobs.

On the other hand the restrictive labor laws have reduced employment prospects in organized manufacturing but also constrained its growth by adversely affecting investment and productivity.


sOURCE--http://www.worldbank.org.in/WBSITE/EXTERNAL/COUNTRIES/SOUTHASIAEXT/INDIAEXTN/0,,contentMDK:22366748~menuPK:295589~pagePK:2865066~piPK:2865079~theSitePK:295584,00.html

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“Sach Ka Saamna”

Our nation has given us great souls like Gautam Buddha, Raja Harishchandra, Mahatma Gandhi, Swami Vivekananda and many more. With “Satyameve Jayate” (Truth Alone Triumphs) as the national motto of our country, we all have a great faith in truth. But, it is also a well known fact that a lie for a good reason is far better than truth which hurts. Now, the question arises that what actually Truth is? For me, it is the voice which comes from your inner self. As, different senses are involved in developing human mind with conditions different for every human being, it may occur that a truth for someone may be untruth for another.

Now-a-days a reality television show by Star Plus named “Sach Ka Saamna” is making buzz all over the country. The discussion about this show is going on everywhere. A petition to in the Delhi High court was filled to have this show banned. But, the court rejected the plea saying that “moral policing” was not its job. A division bench of Chief justice A P Shah and Justice Manmohan quoted that “In this land of Gandhi, it appears that nobody follows Gandhi… Follow the Gandhian principle of ‘see no evil’. Why do you not simply switch off the TV?” They further added that “We have very good advice for you. You have got two judges sitting here who do not watch TV at all. It will certainly help.”

Actually, the debate started with Samajwadi Party’s MP Kamal Akhtar raised the question about the show in the Rajya Sabha. He said that ‘obscene questions’ are asked on the show based on personal lives. He further said that the show is against our “Indian Culture”. His claim was also supported by other MP’s of Samajwadi party and Bhartiya Janta Party. So, the question which arises is that, can a truth be harmful for anyone? There may be different opinions on this issue. But, what I feel is that there are other more important issues of our society than this, which remains orphaned and are not raised by anyone in our country. I believe that those MP’s who raise their voice against such petty affairs as television shows should act on important issues other than just weeping for these television shows. They are sent there by the citizens to raise the issues affecting their daily life. Be it employment, infrastructure development, education, health, security, etc: certainly not to police our television viewing.

However, a doubt also arises on the truth shown on the television show; the truth that is convicted only to raise money. Furthermore, who gives the guarantee that the truth shown on the show is actually true? The management of the show defends it with the polygraphic tests done on the contestant before the final shooting of the programme. But then, it is also a well known fact that these tests are not infallible and contains errors. According to 2003 National Academy of science (NAS) report, polygraphic analyses are “Unreliable, Unscientific and Biased”.

So the bottom line is that our MP’s and media had given so much importance to an issue which is insignificant enough when we consider the bigger issues that our country is suffering from every moment. After all, it is an entertainment based show, not requiring such seriousness. So, just enjoy it or turn off your television sets if it hurts your moral sentiments!!



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Is Rahul Gandhi prime minister material?

He’s been called the “Quiet Revolutionary“. And India’s prime minister-in-waiting. But does Rahul Gandhi, a virtual novice in the rough and tumble of Indian politics, have what it takes for the country’s top job?

He didn’t exactly set the house on fire during his first five years in parliament. And until this election, Rahul’s only USP was that he belonged to India’s first family, the Nehru-Gandhi family which has given the country three prime ministers.

He’s only 39, and has no experience with complex subjects such as Pakistan or the economy.

But after the recent election, Rahul has emerged as a savvy politician, a grassroots activist with a finger on the pulse of the real India.

His strategy of not allying with any of the regional parties in northern India despite pressure from party officials paid off big time.

The Congress party’s decision to go it alone in northern India helped it more than double its seats in Uttar Pradesh.

Initially, based just on his political strategy for this election, there was much speculation over whether he would join the cabinet, and if he did what portfolio he’d get.

Eventually, Rahul wasn’t a part of the cabinet, but he’s still seen as the face of the Congress party from now on — and perhaps prime minister at some point in the future.

But isn’t there a danger he could be sidelined if he isn’t part of the federal cabinet?

Sure, he has age on his side and he can learn over the next five years. Besides, like his father, Rajiv, he appeals to millions of young voters in India.

But he’s not alone in that sense. He is part of a new generation of young parliamentarians like Sachin Pilot and Jyotiraditya Scindia who have a completely new perspective on politics.

So the question many in India are asking is: could Rahul Gandhi be overshadowed by other younger politicians who are in the cabinet?


http://blogs.reuters.com/india/2009/07/01/is-rahul-gandhi-prime-minister-material/

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Democracy vs Communism: Lessons from history

In the social sciences, theories won't get us very far. Instead, we should look at the economic systems, e.g., USSR, CPR, Egypt, Great Britain, and the thousands of small communist and anarchist utopias around the world throughout history.

There we will find that all communist economies eventually floundered because of lack of monetary incentives. They reduced the lowest levels of poverty, but could not advance the general material welfare. Internal violence was reduced, but not necessarily international violence. The only societies that had successful communist economies were primitive native tribes, e.g., American Indians, where most goods were owned by the tribe and personal possessions were few. However, we know what happened to these peoples when confronted by the capitalists!

It is true, democracies, autocracies, dictatorships, etc., are forms of government that have little connection with economic welfare. To understand that subject, we have to look at the economic systems, e.g., capitalism, socialism, communism, etc. Any of the above governments can and have worked with these different economic models with success (and failure). To date, capitalism has shown better results than any other system. However, the current forms of western capitalism are heavily modified by government "rules of the game" that ameliorate the unfavorable side-effects, such as, depressions, excessive inequality, poverty, etc.

Furthermore, feudal, socialist, and communist economies all over the globe, from small utopias (New Harmony, Lanark, Oneida in the U.S.) to colossal nations (Russia), with very few exceptions, have given up on their attempts to establish egalitarian societies because equality and incentive are incompatible.

Where they failed, leftists and fascists removed these liberal governments, but ultimately failed to provide an adequate prescription for per capita income advancement, either by improving technologies or conquering other countries, or both. They are mostly obsolete today. Additionally, all attempts by leftist governments to create classless societies, resulted in merely replacing the capitalist classes with bureaucratic classes, the general population remaining as poor as ever. This was certainly true of the U.S.S.R., and all eastern European countries under the hegemony of the U.S.S.R.

All the richer countries have capitalist economies and most are democratic. In these countries when inequalities generated by capitalism became too great, the exploited and oppressed masses pressured their representatives to pass laws that relieved the poorer segments of the population. Returning to new, revolutionary leftist governments, in the modern world, where would such a government obtain capital and trade to improve the living standards of its people? There are no large leftist governments with such excess money that they can support a poor leftist government until it becomes self-sufficient, a la the then U.S.S.R. vis a vis Cuba.

The rich capitalist countries certainly have no incentive to lend money to leftist governments as a matter of ideology. Best that a new Marxist government can do is redistribute income from the rich to the poor as was done in revolutionary Russia, and Cuba, but then what?

Redistribution benefits the poor at the expense of the rich, but it does not promote increased incomes generally because of the lack of incentives. Therefore, where does it obtain the capital and technology to increase incomes, if the capitalists will not provide it? Inexorably, the lack of incentives under socialism, communism, or any other leftist brand will lead to malaise and poverty, as it did in Russia, eastern Europe, Cuba. There are ample lessons in the 75 years of wars to reach the simple conclusion that democratic capitalist nations are successful, and totalitarian socialist nations are not.

Geography is important in determining whether Nepal has any prospect of becoming richer. Countries that have poor transportation facilities must devote much of the acquired technology to improving it. This was done in the formative years in the U.S. Otherwise, supplies cannot reach producers and products cannot reach customers cheaply enough to be bought by those with modest incomes.

We are talking here, not only of innovative scientists and engineers, the unattainable for Nepal, but technical operators, i.e., "technicians", the people who must know enough math and science to make small decisions involving the operation of increasingly complex machinery.

Whether and how fast a country can modernize itself and become rich, hence, depends not only on geography and culture, but also on the economy, polity, and of course, history of the nations.


http://newsblaze.com/story/20060427224243nnnn.nb/topstory.html

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