RBI reports job growth amid unemployment Concerns

The Reserve Bank of India (RBI) revealed on Monday, July 8, that India created 46.7 million employment in the fiscal year ending March 2024. This figure is substantially higher than those reported by private surveys, which show high unemployment rates.

According to the RBI, the employment growth rate for 2023-24 was 6%, a significant increase from 3.2 percent in 2022-23. Total employment in India increased to 643.3 million in 2023-24, up from 596.7 million the previous year.

The RBI used data from the government’s National Accounts and the Ministry of Labour to calculate these employment figures.

Political Impact: Unemployment and Narendra Modi’s Electoral Challenges

Analysts feel that a lack of jobs and excessive inflation have contributed to Prime Minister Narendra Modi’s recent electoral troubles. He was unable to gain a majority in the directly elected house of parliament and had to rely on allies to obtain a third term in office.

For the first time, the RBI’s report included a provisional estimate of productivity for the entire economy for the financial year 2023-24. Typically, the report only provides historical data.

This declaration comes after a Citibank analysis estimated that even with a growth rate of around 7%, India will only produce 8 million to 9 million jobs, falling short of the 11 million to 12 million required. Samiran Chakraborty, Citibank’s senior India economist, warned that even a 7% GDP growth rate may not match job demands over the next decade.

In response to these concerns, the federal labour department stated that its estimates suggest an average of over 20 million employment opportunities were created each year between 2017-18 and 2021-22.

Meanwhile, the Centre for Monitoring Indian Economy (CMIE), a private think tank, estimated that the unemployment rate in India rose to 8 percent in the fiscal year 2023-24, up from 7.5 percent and 7.7 percent in the preceding two years.

The RBI’s optimistic job growth figures contrast with other reports, sparking discussions on the true state of employment in the country.

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