Skill development important in economic growth, says C Rangarajan

Blending skill development with education would be the best way to achieve the goal, he added

Employability of the growing young demography is an important factor in the economic development of the country and the crisis of skill development has to be turned into opportunity to growth, said C Rangarajan, chairman of Madras School of Economics and former Prime Ministers Economic Advisory Committee.

The coming decade will be crucial for India and only if India grows at the rate of 8-9 per cent per annum, India's per capita GDP will grow from the current level of $1,800 to $8,000-$10,000 by 2025. Only then, India will graduate from being a low income country to a middle income country and achieving, maintaining and sustaining that high level of growth, the country need many things, he said.

Delivering keynote adress Confluence 2014 - Rising Employer Expectations: A Crisis or an Opportunity, organised by skill development firm Talent Sprint and National Skill Development Corporation (NSDC), he said, "We need to raise the savings rate, investment rate and also need to see efficiency in use of capital to maintain that high level to achieve the growth expected. For all of this, we also need critical manpower. That is where the skill development progammes comes. Whether it a crisis or an opportunity. I want to say, that crisis always generates the opportunity."

Government can broadly set policy framework for skill development, while the industry could join in public private partnership models to improve the skills. "We have reached a point where reform of higher education has become urgent. The excellent quality of our best students is recognised by the people abroad. All our students going abroad do extremely well," he said.

There is an urgent need to take a look at the effectiveness of the current education system. Increasingly concerns are being expressed on the employability of the graduates who come out. It is related to two directions. One is the quality of the domain knowledge that is being important. And the other is the relevance of the programmes and the courses that are being offered.

The three dimensions of the reform of the higher education is the access, equity and quality. Access to higher education is to expand the gross enrolement rate, which is still lower than many other countries. Equity is important as it is important to bring the vulnerable groups within the scope of higher education. Without quality, achieving quantitative targets, is counter-productive.

Quoting a report of Talent Sprint which said that in 2020, only 27 per cent of the 7,50,00,000 fresh graduates would be employable, he said, "If we are churning out graduates, out of which only 20-25 per cent are employable, there is a huge waste of human and financial resources. We need to raise this percentage to a much higher level."

There is a need to update the curriculum, to revamp the examination system which is currently a test of memory than test of analytical skills and to improve the quality of teaching and teachers. Blending skill development with education system is required, he added.