Thursday, October 24, 2019

Where is the money to fry pakodas?

In recent years, "self-employment has been touted as an answer to India's employment challenge", wrote Anand and Thampi. Apparently, about 4.75 million people enter the job market every year, which means young people coming of age. But, instead of creating new jobs India lost 10.9 million jobs in 2018, according to a report by the Center for Monitoring the Indian Economy (CMIE). "The number of employed recorded in December 2018 was 397 million, which was 10.9 million less than the figure of 407.9 million seen a year ago in December 2017." "Youth inactivity is highest in India compared to emerging and developing economies and it is about in 30 percent," said IMF senior economist John Bluedorn. Prime Minister Narendra Modi advised people to start their own businesses frying 'pakodas', a snack of vegetables fried in batter, and employ others, creating a lot of comments. However, tax officials, after exhaustive investigation unearthed a 'kachori' (another fried snack) seller who is earning Rs 6 million per year. Even so, the labor force participation rate (LFPR), which counts those working or actively looking for work, dropped to 49.8%, with the unemployment level being highest among graduates at 13.2%. Pakoda fryers must be creating lots of jobs. "As much as 70% of the self-employed were own account workers", which means they are running their own establishment "without hiring any worker", "while 26% were unpaid helpers who assist household members in running their enterprise, but do not receive any regular wage or salary". "Only 4% of the self-employed were employers." The median monthly earnings of street vendors is Rs 7,000, for food processing workers it is Rs 2,500, for textile and garment workers it is Rs 5,500 and, for a people who believe in fate, median monthly income of astrologers and fortune tellers is Rs 8,000. Taxi drivers (including Uber and Ola drivers) came top with Rs 10,000 per month. As during Christmas in the West, the months of September and October are festival months for Hindus in India when retail sales give a boost to the economy. But, this year growth in GDP remained subdued in September, wrote Nikita Kwatra. If profits fall companies will cut or deny bonuses to their workers or, even worse, may sack some to reduce expense. The situation is even worse in villages. "The downturn this Diwali season is so dire that even large landowners (owning 50 to 150 acres of land) are postponing the purchase of a new tractor or the replacement of an old car,' wrote Sayantan Bera. It is so bad that lunch for children is rotis with green chillies, Bera found earlier. You need to buy ingredients to fry pakodas. Where is the money?

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