Why is it that there is still widespread poverty in India, despite the 7-8% per annum GDP growth rate over the past decade? Nearly 60% of our population lives around the poverty line, whether slightly above or below doesnt matter.
A country's economy goes through the phases of Agrarian -> Industrial -> Services Economies. The skill sets/education required of the population for each phase varies from Basic School Education in the Agrarian phase, to Technical/semi technical skills during the Industrial Era to the higher level service oriented MBA/CA/Legal etc in the Services Sector.
Normally, this transition happens over at least 2-3 generations, whereby giving time for the respective governments to plan, upgrade the skill sets of successive generations in advance, so that they are employable when the transition from one phase to another happens.
In India's case, the rural India has been stuck on the Agrarian phase since independence. The transition to Industry and Services has been too fast and too quick, for it happened within a decade or at best a decade and a half. And the beneficiaries were the urban , semi urban population who were better equipped and possessed the right skills to exploit this transition. The poor rural population saw their opportunities shrinking, the sector is growing at 2-3%, the sector has the least priority amongst the policy makers, and unfortunately for them, the Government, instead of tackling the root cause of retraining and upgrading their skill sets, is trying to have a quick fix by giving doles, subsidies and ensuring they remain where they are.
Need of the hour is massive retraining of the rural population. But is someone listening?
