Where the Jobs Are

Sajad proposes that young people should stop looking for sarkari jobs. This fact is borne by the Rangarajan Panel report, which recommends providing funds to create non-government jobs

(Mr. Sajjad Bazaz, 45, was born in Srinagar. He attended the Khalsa high school and the Sri Pratap College in Srinagar. He received his bachelor's degree in Media and his master's degree in Mass Communication and Journalism from the University of Kashmir. Mr. Bazaz has over two decades of experience in journalism (both print & electronic), and he is author of the book "Bankwatch" which is about a financial scenario with particular reference to the J&K state. He is currently incharge of corporate communications department in a leaduing financial instution in J&K. Mr. Bazaz likes to spend leisure time watching movies and enjoying company of his friends.)

Self Employment Ventures

Unemployment is a global phenomenon. Every country is devising programmes and launching initiatives on continuous basis to combat this challenge. However, it is the design and format of initiatives which makes such programmes successful in engaging youth in profitable self employment ventures. Since finance is the backbone to all such employment generation programmes, various schemes are tailored and put in place to encourage unemployed youth for self employment ventures by way of financial support.

Since our state is also plagued with growing menace of unemployment, a good number of state as well as central government sponsored employment generation schemes are in place. With annual incremental increase in unemployment scenario every year thousands of unemployed educated youth enter into the list, largely due to the economic distress and mismatch, the problem is going to be one of the biggest challenges before all counts. The jobs created by the state government are nowhere matching the burgeoning number of unemployed youth.

We cannot ignore the fact that the unemployment problem in the state is mainly responsible for social tensions. To generate a lasting solution to the problem of educated unemployed youth, various state and central level self employment schemes are in place, which include schemes like JK Self Employment Scheme (JKSES), Swaran Jayanti Shahri Rozgar Yojana (SJSRY), Swaranjayanti Gram Swarozgar Yojana (SGSY), Prime Minister’s Employment Generation Programme (PMEGP) etc. These schemes have failed to facilitate the unemployed youth to shape their future in a better way in view of the negligible growth of salaried jobs. Notably, the Government of India has, in a major decision, decided to restructure and redesign the Swarnajayanti Gram Swarozgar Yojana (SGSY) and convert it into the National Rural Livelihoods Mission (NRLM). Under this mission a multi-pronged strategy for poverty reduction in a time bound manner will be used by providing sustainable livelihood through various means to rural population below the poverty line.

When we talk of implementation of the government sponsored self employment schemes in J&K state, we can simply say that these schemes are not delivering as intended. While analyzing the performance of these schemes, the basic purpose of eradicating the unemployment, particularly among the educated unemployed youth has been defeated. There are several reasons behind the failure of these schemes. The banks operating here are blamed for not promoting these schemes. But those who blame the banks don’t bother to look at the huge amount of money blocked under these schemes, as most of the loans given under these schemes have turned bad. The huge percentages of bad loans under this category have shaken the lending confidence of the banks and are genuinely showing reluctance in extending loans to the beneficiaries.

We have seen a youth financed by the bank for his self employment venture outside the ambit of government sponsored schemes, shows enthusiasm in his line of activity and gives his best to earn and repay the loan well on time. Contrary to this, a youth is financed under any of these government sponsored schemes, looks out more for creating situations to avoid repayment of the loan. One of the most serious problems is the faulty identification of the beneficiaries. It is done in a casual manner where most of the time viability of activity becomes casualty. This kind of situation has resulted in saturation of the line of activity.

Instances galore that at the time of processing a case, the youth who is referred as beneficiary, is given an impression that chances are bright that the loan amount may be waived off in future apart from getting government subsidy. Taking advantage of the meaning of word ‘beneficiary’ - one who receives anything as a gift– the youth is given to understand that he doesn’t need to think of repaying the loan. This kind of official backing, which is not without a cost, is ironical. It is a hard fact that the banks’ substantial amount blocked in these schemes is primarily because of most of the time selection of borrowers has not been prudently done.

There are cases of the beneficiaries of these schemes who are government employees. There is need to launch an investigation into these fake beneficiaries, who have failed to repay the loan taken under these government sponsored schemes, on war footing. The cases should be registered against them and the officials of the sponsoring agencies responsible for sponsoring them to the banks.

Allegations also galore against the government sponsoring agencies that the beneficiaries are forced to pay for getting sponsored under any of the self employment schemes. Here the element of subsidy in such schemes is used as a tool by the agencies to motivate and extract money from the beneficiary. This is evident from the fact that the cases referred are most of the time full of flaws. There are also instances where it has been observed that the beneficiaries generally are not serious in establishing the units under the schemes opted by them and they resort to diverting the loaned funds to other non-productive activities, resulting in default in repayment of the bank dues, which ultimately gives rise to non-performing assets, thereby preventing banks and other lending institutes from being enthusiastic towards lending under Government Sponsored Programmes.

Precisely, the ventures promoted under these schemes have been experiencing a high mortality rate for varied reasons, as there is no visible impact in the economy. Consequently, the objective of providing employment opportunities to the people by generating productive ventures through these Government Sponsored Programmes has remained a distant dream so far. The State has not been able to promote and create any employment-oriented and labour intensive private sector enterprises having any significant impact to tackle the problem of unemployment, with the result the growing unemployment problem of the State could not be addressed and is accentuating at an alarming rate with each passing day. Consequently, the issue of generating productive ventures for gainful employment has gained utmost significance to be focused as a high priority issue for effectively tackling the alarming problem of growing unemployment.

If the horizon of local employment generation is to be expanded in the state to offer jobs to all aspiring youth and other citizens, then some innovations are necessary in forwarding the benefits of these sponsored schemes to the genuine persons. The first and the foremost thing is to win back the confidence of banks by ensuring timely recovery of money under these schemes. At the same time, there is also need to restructure the role of sponsoring agencies where banks are given major role to identify the beneficiary and the line of activity. This will check faulty identification of borrowers and curb the saturation of the activities.

Amid this background, there is need to have a holistic re-look on the government sponsored employment generation schemes. These schemes need to be restructured to suit the current environment. In fact, the whole system of operating these schemes needs a revamp. The schemes need to be redesigned as per our regional or geographical location.


Rangarajan Panel Rolls out Rs. 2,000 cr Jobs Plan: Focus On Skill-Development, Private Sector

Muddasir Ali (Greater Kashmir)

Srinagar: An expert panel assigned to formulate a job plan for Jammu and Kashmir in the aftermath of summer 2010 unrest, Thursday rolled out Rs 2,000 crore program here for improving employability in the state.

The report recommends setting up of Rs 257 crore Skill Employment and Empowerment Scheme to envisage placement-linked and market-driven skill training of 50,000 to one lakh youth over the next 5-years, launch of a special industry initiative in Private Public Partnership (PPP) mode for enhancing the skills and employability of 40,000 youth in 5-years and launch of special scholarship scheme to benefit 25,000 students in next 5-years with an allocation of Rs 1,200 crore.

Accompanied by other members of the panel head C Rangarajan handed over the report to Chief Minister Omar Abdullah at a function at SK International Convocation Center here today.

“The report envisages flagship schemes. A two pronged approach has been adopted to recommend for job creation - to improve skills which will in turn increase employment rate among the youth and making available employment opportunities,” Rangarajan, who is the Chairman, Economic Advisory Panel, to the Prime Minister Dr Manmohan Singh, told a gathering about the contents of the report.

Rangarajan stressed that financial allocations have to be made for implementation of the program and execution mechanism has to be strong.

“We have taken a bold initiative. We have suggested mechanism for implementing the schemes and the panel will pursue it with the PMO. Implementation mechanism has to be strong. Otherwise ideas remain just ideas. Big effort is needed to bring transformation. We are hopeful that with the help of the state and central government the programs are implemented,” said Rangarajan who is a former RBI Governor.

Rangarajan asserted that top notch of India’s corporate sector like, Infosys and Tata have expressed their willingness to come forward for engaging in implementation of the job plan.

The report, Rangarajan said tries to lay out schemes to prepare the youth with skills which would improve their employability.

Regarding Skill Employment and Empowerment Scheme, Rangarajan said the Union Ministry of Rural Development which is already imparting such training would be the nodal agency and the youth from rural as well as urban areas both from APL and BPL categories would be trained.

“If the scheme is implemented fully, it will bring significant change in the state. Some of the probable private sector partners are IL&FS, Kuoni, Don Bosco and Dr Reddy's Foundation,” he said.

Regarding the initiative in the industrial sector, he said there is a need for collaboration between private industries, state government and government of India in training and absorbing the youth. The Union Ministry of Home Affairs would be the nodal agency for the scheme for which 50 percent of the cost would be borne by the government and another 50 percent by the companies.

“We will urge the Prime Minister that funds are made available for the scheme. It is not necessary that youth trained get jobs only in the state but in other states as well. It will be good way of ensuring greater integration,” Rangarajan said. “The companies that have expressed interest are Infosys Technologies, Tata Consultancy Services, Godrej and Boyce, BILT, Crompton Greaves, Avantha Group, Bajaj Auto, WWFI, JCB India, Tata Motors and Apollo Hospitals."

For scholarship program, he said the panel has proposed that students from state get admission in different institution outside, “though it is very difficult for the institutions to set aside a quota of seats.”

The latest initiative on employment generation follows constitution of two panels on economic development of JK some years back whose recommendations are gathering dust. Both these panels were also headed by C Rangarajan.

Dr Singh had constituted the Task Force on Economic Development of JK in 2005 which submitted its report in November 2006. Some of the key recommendations included; transfer of 390 MW Dulhasti Hydel Power Project from NHPC to J&K and transfer of 1020 MW Bursar Storage Scheme from NHPC to J&K for execution in the state sector. No follow-up action was taken on the recommendations of the Task Force especially relating to transfer of Dulhasti power project to the state.

Among the five Working Groups on Jammu and Kashmir constituted by the Prime Minister in May 2006, the third Working Group on ‘Economic Development of the State” was again headed by C Rangarajan.

While reiterating the implementation of the recommendations made by the Task Force regarding transfer of Dulhasti and Bursar power projects from NHPC to the state it had called for increasing the state’s power share in the central projects among other recommendations. The Group had also called for vacating the properties in possession of the security forces and the army, especially those relating to industrial activities.

For economic development in JK, he said two reports have already been submitted to government of India. “For immediate impact we have provided for several schemes in different sectors like agriculture, horticulture and others as well,” he said.
Regarding sectoral initiatives, Rangarajan said the group has recommended revival of State Finance Corporation by providing Rs 100 crore for the purpose to revive flow of credit to the enterprises.

"The amount will not be enough. Another Rs 50 crore should be granted for making it operational," he said.

He said the credit flow was necessary for allowing the small and micro enterprises to flourish in the state. Other initiatives recommended include faculty enhancement programs, persuading private school and educational institutions to accommodate children from Jammu and Kashmir.

Responding to a question, Rangarajan said some of the schemes given in the report should take off soon as there is no reason for delaying them.

“We are seeking separate allocations (for separate schemes). For employment oriented programs funding will have to be done from appropriate authorities,” he responded to another question.

Asked about the fate of recommendations on transfer of power projects to the state made by the Prime Minister’s working group headed by him, the noted economist evaded direct response. “You know our reports which have indicated why certain measures should be taken.”