Surjit Bhalla, a former executive director of the IMF for India, stated on Sunday that the Narendra Modi government is creating, on average, an unprecedented number of jobs—roughly 10 million over the last seven to eight years.
Mr. Bhalla added that the UPA government period, which ran from 2004 to 2013, saw the lowest number of jobs created, and it was during this time that the phrase “jobless growth” originated.
“The Modi administration has created the most jobs ever recorded. In Indian history, the average number of jobs created has never been higher. Over the previous seven or eight years, something like 10 million jobs,” he said in a video interview with PTI.
Mr Bhalla, a former member of the Economic Advisory Council to the Prime Minister (EAC-PM), asserted that the maximum number of jobs were created during the tenure of Atal Bihari Vajpayee and PM Modi.
He was responding to a recent International Labour Organization (ILO) report, which showed that in 2022, the share of unemployed youths in India’s total unemployed population was nearly 83 per cent.
“If you look at the data of youth after the age of 29, the unemployment rate in India, which is the most of the population, most of the workforce has been somewhere around 1 per cent, which is really not much of an unemployment rate at all,” Mr Bhalla explained.
For the youth, he said they are looking for a better job.
“So, frictional unemployment is higher everywhere in the world, amongst the youth,” Mr Bhalla noted.
Prime Minister Modi-led BJP government came to power in 2014 and came back with a thumping majority in the 2019 general elections.
On slowing down of foreign direct investment in India, Mr Bhalla said an important reason for the fall in FDI in India could be attributed to the government’s new policy, which says if there is a dispute related to investment, then it has to be settled in India.
“Now, if I am a foreign investor, why should I take that risk? And I don’t think it is the case anywhere else in the world,” he said.
According to Mr Bhalla, foreigners are not increasing their direct investment, but they are raising their portfolio investment.
“I am hoping that whichever the new government will be, I believe it will be the BJP, that this is one policy they have to take a second look at,” he said.
Last year, gross FDI inflows slowed marginally to $59.9 billion in April-January 2023-24 from $61.7 a year ago, while net FDI inflows fell sharply to $14.2 billion from $25 billion.
From 12.5% of FDI in the first nine months of 2022 to just 1.7% in the same period of 2023, there has been a sharp decline in FDI flows to China.
Following the reduction in FDI flows to China, a number of nations, including the US, Canada, Mexico, Brazil, Poland, and Germany, have seen notable increases in their global share.
Based on statistical probability, Mr. Bhalla estimated that the ruling Bharatiya Janata Party (BJP) would likely win between 330 and 350 seats on its own.
“So, if the BJP gains about five percentage points increase in its vote share in this Lok Sabha polls, then I think the party is likely to get 330 to 350 seats,” he said.
The seven-phase Lok Sabha polls, the world’s biggest election exercise, kicked off on April 19, with the counting of votes set to take place on June 4.
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