The post-pandemic world has created a situation where the spread of automation will require a significant skilling of India’s workforce, Reserve Bank of India (RBI) governor Shaktikanta Das said on Wednesday.
“A major challenge to inclusiveness in the post pandemic world would come from the fillip to automation provided by the pandemic itself. Greater automation would lead to overall productivity gain, but it may also lead to slack in the labour market. Such a scenario calls for significant skilling/training of our workforce,” Das said, speaking at an event organised by the All India Management Association (AIMA).
The governor cautioned against the emergence of a digital divide as digitisation gains speed after the pandemic. Further, he stressed on the need for professional human resources trained in science, technology, engineering and mathematics (STEM). In the short term, the supply of such a workforce cannot be increased by the traditional educational system, and thus there is a need for close involvement of corporates in the design and implementation of courses suitable to the changing industrial landscape, Das said.
As the country recovers, it must deal with the legacies of the crisis and create conditions for strong, inclusive and sustainable growth, he said. “Limiting the damage that the crisis inflicted was just the first step; our endeavour should be to ensure durable and sustainable growth in the post-pandemic future. Restoring durability of private consumption, which has remained historically the mainstay of aggregate demand, will be crucial going forward,” Das said. More importantly, sustainable growth should entail building on macro fundamentals via medium-term investments, sound financial systems and structural reforms. Towards this objective, a big push to investment in healthcare, education, innovation, physical and digital infrastructure will be required, he added.
India should also continue with further reforms in labour and product markets to encourage competition and dynamism and to benefit from pandemic induced opportunities, Das said, applauding the production linked incentive (PLI) scheme for certain sectors. He said that the sectors and companies which benefit from this scheme must utilise this opportunity to further improve their efficiency and competitiveness. “In other words, the gains from the scheme should be durable and not one off,” Das said.
The governor observed that for growth to be sustainable, a transition towards a greener future will remain critical. There is a need for clean and efficient energy systems, disaster-resilient infrastructure, and environmental sustainability. “Due consideration should be given to individual country roadmaps keeping in mind country-specific features and their stage of development while adopting policies towards climate resilience,” he said.