India must increase labor productivity to become a developed nation, says Niti Aayog's Suman Bery

The ‘Viksit Bharat’ vision entails becoming a high-income society that empowers citizens to realize their potential and aspirations, for which India’s demographic dividend is to be effectively leveraged, says Niti Aayog, Vice Chairman, Suman Bery. Increasing labor productivity is central to India’s aspiration of becoming a developed nation in about two decades, as it would raise living standards and boost growth momentum, said Suman Bery, Vice Chairman, federal policy think tank NITI Aayog, on Thursday. Such a development success is a means to achieve an end, which is ensuring the dignity of the people, Bery said, speaking at the Confederation of Indian Industry’s (CII) annual business summit in New Delhi. “The point, I am going to make is that for these goals, a sustained rise in the productivity of labour is crucial,” Bery said. Berry said better labor productivity will help raise the standard of living, while absorbing underutilized labor, particularly women and youth, will boost economic growth momentum. People queue up for Government jobs when real wages don’t rise, a result of rising productivity, as fast as their aspirations, he said, highlighting the need for the private sector to generate better jobs. Bery also said the Indian industry, which welcomed the economic liberalization in 1991, is certainly strong enough to welcome further judicious liberalization in 2025 and in the coming decade.

According to Bery, while the size of the Indian economy is half that of the US in purchasing power parity terms, the size of the labor force is three times that of the US. The aim should be to leverage our labor force to take the economy to a higher level of growth for generating better jobs. He mentioned that countries such as the UK and Canada face the problem of stagnation in productivity. While productivity is rising in India, it is lower than in China and the ASEAN region, a statement issued by the CII said, quoting the NITI Aayog, Vice Chairman. India should adopt a blend of self-reliance and global engagement to stay competitive, the statement added. Bery said forging free trade deals with trading partners, entering high-value sectors and diversifying India’s sources of supply is crucial to stay ahead. Competitiveness should not only be restricted to manufacturing but should extend to services as well, the CII statement said, quoting Bery.

Source : https://www.business-standard.com/india-news/increasing-labour-productivity-crucial-to-viksit-bharat-niti-vc-125052901732_1.html