By Gary Coleman - October 09, 2014
In his recent Independence Day speech, India’s Prime Minister Shri Narendra Modi proclaimed that “the youth of India has completely transformed the identity of India in the world.” He appealed to the youth of India to continue this trend—by enhancing their skills, seeking out new business ventures, and striving to achieve his vision of a “Digital India.”
Having visited India only a few days after Modi’s speech, I was intrigued by this idea of the younger generation’s impact on the economy. I was particularly interested in its relation to manufacturing and innovation, two topics that came up repeatedly in my discussions with colleagues at Deloitte India, their clients, and the media. With India seeking to take its place in the world as an innovation and manufacturing hub, this demographic—particularly millennials—will play an increasingly important role.
According to Modi’s speech, 65 percent of India’s population is under the age of 35 years—the largest number of youths of any country in the world. How this demographic participates in the workforce could be the single most influential factor for India’s economy over the next decade. How these individuals are educated, where they choose to work, and what kind of career path is open to them will impact the trajectory for both manufacturing and innovation in India.
First, building manufacturing is a goal to which India is committed. Modi emphasized in his speech that the world should come and “Make in India.” A formal campaign to support this effort launched across the country last month.1 It is the youth of India who will be expected to occupy these new manufacturing jobs. But, according to estimates from the Confederation of India Industry and the National Skill Development Corporation in India, over 70 million manufacturing jobs in India over the next 15 years could go unfilled due to a skills gap. To cultivate the pipeline of workers needed to support today’s high-end manufacturing, the government must actively invest in education and training now.
Second, India must invest in building a culture of innovation. With its strong base in IT, India’s strength in this area would seem like a given. But India recently fell 10 notches in the 2014 Global Innovation Index to 76th--the worst performer among the BRICS nations.2 Again, India must look to its youth to help remedy this deficit in innovation. Millennials in India clearly are looking for innovation—a reputation for innovation is important for roughly 90 percent of millennials in India when they choose an employer, according to Deloitte’s Millennial survey. And with entrepreneurship a vital factor in building innovation within an economy, it should be heartening that 87 percent of India’s millennials said they see themselves working independently someday rather than being employed within a traditional organizational structure.
It’s not unusual for a country’s leader to deem its youth the key to the future. But in India, which enjoys a demographic advantage over much of the world’s developed economies, this mantra is more than rhetoric and holds incredible potential if properly cultivated.
1FirstBiz, 18 September, 2014.
2Cornell University, INSEAD, and the World Intellectual Property Organization.
Gary Coleman is Managing Director, Global Industries, of Deloitte Touche Tohmatsu Limited. He is a member of Deloitte’s Global Markets Committee and is the lead partner in Deloitte’s strategic relationship with the World Economic Forum. Follow him on Twitter @gcoleman_gary.