write the impact of skill development of indian economy 10 marks
Answers
The above two formulas speak very clearly that skill development is a necessary part of reviving the Indian economy in the long term. Interest rate cut down and taxation will not create eligibility for doing skilled jobs when the base of the skill required to do the job is increased due to technological advancement.
You can invest in technological advancement kicking in the taxation and interest rate benefits and double the productivity. But this productivity growth does not guarantee that consumption will pick up since the labour force does not get a job due to lack of skill (who are indirectly the buyers of the product). The problem is that labour, capital and technology is not getting an appropriate combination to get the economy going ahead.
India is looking for a USD 5 Trillion GDP which cannot be achieved only on the service industry and consumption. Manufacturing, reducing inequality will lead to the growth of the Indian economy. Indian consumption-based GDP growth cannot achieve based on capital or liquidity injection within the society. One needs to understand when the labour force skilled education is enhanced employment gets into the picture which actually drives the consumption. What we are trying to do is that by lowering taxes and interest rates we want people to borrow and spend. This consumption theory will not work. The demographics of the economy is changing simultaneously with the velocity change of technology.