Sunday, March 22, 2026

Russia can't add to India's product.

"Since 2003, India's economy has expanded at an average annual rate of over 7%. If this momentum continues for the next 20 years, India could cross the high-income threshold, with per capita GDP exceeding $15,000 in 2025 terms." Thus avoiding "the 'middle-income trap' that has stalled economies such as Brazil, South Africa and Turkey." ET. Recently, a small research shop Citrini cause panic "when it outlined a scenario in which AI ends most white-collar employment by 2028, with dire consequences for the broader economy," wrote Prof Raghuram Rajan. However, inertia, competition between companies with similar AI products and AI-assisted increase in human productivity may create new employment. In India, the situation is already critical. "The unemployment rate among persons aged 15-29 years rose to a four-month high of 14.8% in February...according to the Periodic Labour Force Survey (PLFS) released by the Ministry of Statistics and Programme Implementation." Unemployment for females stood at 17.6% and for males at 13.7%. The Wire. "Between 2004-05 and 2023, while approximately 5 million graduates were added each year, only around 2.8 million found employment," so that, unemployment is at 40% among 15-25 year-olds and at 20% among 25-29 year-olds. ET. "Unlike much of East and South-East Asia, which relied on export-led manufacturing to absorb low-skilled workers, India's expansion has been driven by skill-intensive services - IT and communications in particular." So that "between 1983 and 2023, graduate unemployment remained stubbornly high at 35-40%." BBC. "Over the past three-and-a-half decades, India's software industry has created millions of white-collar jobs, spawning a new middle class driven by high ambition and strong spending power." However, "Some CEOs have even warned that AI could eliminate 50% of entry-level white-collar jobs." On the other hand, "According to Infosys, generative AI might displace 92 million jobs such as front-end developers and testers, but it will create some 170 million new jobs for data annotators, AI engineers and AI leads." BBC. "Hiring from India has grown 24.1% from the United States, 63.7% from the United Kingdom and 61.5% year over year." "Software developers, software testers and user interface specialists remain the most sought-after professionals." And yet, "The median pay for AI trainers in India stands at $12 per hour, far below earnings in advanced economies." TOI. For those not so educated, Russia is hiring "scaffolders, tailors, welders, drillers, cooks and others" and issued 72,000 work permits, or 33% of its foreign worker count, to Indians in 2024. A salary of $700 (around Rs 63,000) per month overcomes any fears about the war with Ukraine. Mint. Russia plans to hire another 40,000 workers from India in 2026. TOI. How can the gross domestic product (GDP) rise to $15,000 per year if millions of Indians are not producing anything? Producing in Russia doesn't count. A fairy tale. Like Goldilocks.     

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