Given that the increasing presence of artificial intelligence (AI) could lead to huge dislocations, India needs to prepare its youth to help them profit from this development, Chief Economic Advisor V Anantha Nageswaran said on May 18.
"Importantly, we need to prepare the youth for AI, since it is going to burst on us in a very spectacular way in the coming years and it will cause huge dislocations. We need to harness it and guide it in a manner that our youth are able to profit from that. That is a huge challenge for many countries, including India but our numbers make it that much more important and serious compared to many countries," Nageswaran said.
His comments come amid concerns about the impact of jobs with the advent of AI.
Back in February, India's Finance Minister Nirmala Sitharaman in an interview with a newspaper, addressing the public's concerns about the impact of AI on jobs said that while AI is a significant technological advancement, it doesn't function in isolation and requires human collaboration to be effective.
She further said that the focus shouldn't just be on the number of jobs but also their quality and relevance in an AI-integrated future. Sitharaman pointed out that investments in AI could lead to the creation of new job opportunities in related sectors or support services.
In March, the Cabinet approved a comprehensive national-level India AI mission with a budget outlay of Rs 10,372 crore for the next five years, under which the government will allocate funds towards subsidising private companies looking to set up artificial intelligence computing capacity in the country and also allocate seed funding for start-ups in the sector, among other things.
Beyond AI, the finance ministry's top adviser on May 18 also flagged the need to protect the physical health of the youth of the country since the demographic dividend India currently enjoys will not be realised unless the largest section of the population is healthy -- physically, mentally, and emotionally.
Weighing in on the issue of employment, he said that the quantity of youth covered by India's education system is no more a challenge, but learning outcomes are.
"The combination of better physical, digital infrastructure and better balance sheets of banks should show in coming years that the employment generation challenge will largely get addressed. However, there is still work to be done on skilling and employability," he added.
The chief economic adviser emphasised that whether India becomes the fifth, third, or second largest economy of the world will only matter once the country achieves improvements in human resource development indicators.
"Because economic growth is a means to an end it may not be a sufficient condition but it is a necessary condition and it has to lead to improvements in human resource development. We are pursuing cleaner and safer cities and very importantly entrepreneurial and vibrant urban agglomeration. We need to make our cities bigger and not just the metropolitan cities better and make second and third tier cities into engines of growth and in short if you combine all of this to become a developed nation by 2047," Nageswaran noted.
While applauding the government's success on physical and digital infrastructure, Nageswaran laid out the areas the country needs to focus on as it looks to achieve sustainable and high GDP growth in the coming years:
- Dialogue with states and other stakeholders for next-generation reforms
- Easier compliance particularly for MSMEs particularly
- Coherent policies for energy transition
- Continuing the current work on maintaining macro-economic financial market and external stability
- Sustainable public finance at the general government level leading to improvement in credit ratings
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