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Despite world-beating growth, India’s lack of jobs threatens its young By Reuters

Despite world-beating growth, India's lack of jobs threatens its young

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© Reuters. Nizamudin Abdul Rahim Khan, 23, a worker, poses for a photograph in an alley at a slum area in Mumbai, India, May 20, 2023. REUTERS/Niharika Kulkarni

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By Ira Dugal

MUMBAI (Reuters) – On a hot summer afternoon, 23-year old Nizamudin Abdul Rahim Khan is playing cricket on a muddy, unpaved road in the Rafiq Nagar slum in India’s financial capital, Mumbai.

Here, there is scant evidence of India’s fast-growing economy. Bordering what was once Asia’s largest garbage dumping ground, Rafiq Nagar and surrounding areas are home to an estimated 800,000 people, most living in tiny rooms across narrow, dark alleys.

The young men and women in the area struggle to find jobs or work, and they mostly dawdle the day away, said Naseem Jafar Ali, who works with an NGO in the area.

India’s urban unemployment soared during the COVID-19 pandemic, reaching a high of 20.9% in the April-June 2020 quarter, while wages fell. While the unemployment rate has fallen since, fewer full-time jobs are available.

Economists say more and more job-seekers, especially the young, are looking for low-paid casual work or falling back on unreliable self-employment, even though the broader Indian economy is seen growing at a world-beating 6.5% in the financial year ending in March 2024.

India is overtaking China to become the world’s most populous nation with over 1.4 billion people. Nearly 53% of them are under 30, its much-touted demographic dividend, but without jobs, tens of millions of young people are becoming a drag on the economy.

“Unemployment is only the tip of the iceberg. What remains hidden beneath is the serious crisis of underemployment and disguised unemployment,” said Radhicka Kapoor, fellow at economic research agency ICRIER.

Khan for instance, offers himself as casual labour for home repairs or construction, earning just about 10,000 Indian rupees ($122) a month to help support his father and his four sisters. “If I get a permanent job, then there will be no problem,” he says.

The risk for India is a vicious cycle for the economy. Falling employment and earnings undermine India’s chances to fuel the economic growth needed to create jobs for its young and growing population.

Economist Jayati Ghosh calls the country’s demographic dividend “a ticking time-bomb.”

“The fact that we have so many people who have been educated, have spent a lot of their own or family’s money but are not being able to find the jobs they need, that’s horrifying,” she said.

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