manufacturing

A new study by the Exim Bank has found that around 15% of the total jobs in India are related to India’s exports sector, including both IT, BPO and material goods such as garments.

The total number of jobs supported by aggregate Indian exports increased from about 34 million in 1999-00 to 62.6 million in 2012-13, with a growth rate of 3.4% per annum, it found. This is higher than the pace at which India, as a whole, has been able to increase employment opportunities for its citizens.

Ëmployment growth has been sluggish despite India’s fast economic growth since the 1990s,” said the report.

The key drivers of jobs exports growth has been sectors such as garments & textiles, gems & jewelry, cotton textiles, communication and electronic equipment, motor vehicles, food products, metal products and leather footwear.

The total GDP of India is around 1.8 trillion, while the total exports from India to other countries is around $25 bln per month or about $300 bln per year.

This translates to a share of around 17% in total GDP and indicates that the contribution of exports to total employment is around the same as its share in the total organized economy.

However, pointed out the study, the share of exports in the total economy is increasing with every year.

“Ëxport related jobs grew significantly faster than that of country’s total employment: the share of export-supported jobs in total employment increased from little over 9% in 1999-00 to 14.5% in 2012-13,”it said.

Almost half of the export-related jobs are índirect’, meaning that they are created at the level of vendors and partners of exporters.

Ïndirect job creation increased significantly in recent years, from 38% in 2007-08 to 50% in 2012-13.

Backward linkages, particularly from manufacturing to agriculture and services, have become an important source of export related job creation in the country, it said.

The study identified manufacturing to be the one with the largest potential to generate employment, both directly as well as in agriculture and services through backward linkage effects.

Policies specifically targeting export growth from the manufacturing sector can reap rich dividends in terms of creating large scale employment opportunities for various skill categories.

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