India's main challenge is skills gap for young: FM Nirmala Sitharaman

India faces a significant challenge skilling its vast young workforce to meet the requirements of the job market, Finance Minister Nirmala Sitharaman said at an event hosted by The Economic Club of New York on Monday. 

“The biggest challenge that we had is the employability level or the skill set which is so required,” Sitharaman said. Businesses often feel that graduate students don’t have the appropriate skills for the job at hand, she said. “For being employed, they need something more and it is that gap that the government of India is trying to now fill,” she added.

She also spoke about the global economic environment and the challenges they pose. “While the past decades saw global growth led by broad multilateral trade, the coming years will likely be defined by strategic economic partnerships, and India is well-poised to take advantage of this transition,” she said. Sitharaman stressed that the shift towards a more fragmented global economy, characterised by changing alliances and trade patterns, could work in India’s favor. “As nations reassess their supply chains, India hopes to become a key partner for countries diversifying their sources of goods and services," she said at the event organised by Columbia University’s Deepak and Neera Raj Center on Indian Economic Policies.

In New York, she chaired the Tech Leaders Roundtable and visited the TCS headquarters. In New York, she addressed a roundtable on “Investment Opportunities in India” at the New York Stock Exchange and participated in a fireside chat on India’s economic reforms and growth with IBM Chairman and CEO Arvind Krishna. 

Sitharaman will head to Washington, DC, for the Annual Meetings of IMF and the World Bank, as well as the G20 Finance Ministers and Central Bank Governors meetings and other high-level discussions. 

Addressing global uncertainties, Sitharaman noted, “The world today faces multiple challenges, such as the conflicts in the Middle East and between Russia and Ukraine, along with other potential destabilizing events like dollar liquidity shocks, trade wars, and oil price hikes. These factors, combined with China’s growing influence, have made it necessary for countries to protect their domestic production.”

She also met Citibank CEO Jane Fraser and discussed the banking sector in view of the decadal reforms and the way forward for India. “The two discussed the use of #AI in important sectors such as #agriculture and #UrbanDevelopment as well as India’s booming #pharmaceutical sector and hub for the world,” the finance ministry said in a post on X.