As India’s gross domestic product dropped under six per cent, surrendering its top GDP growth position to China and indicating a clearly underperforming economy, the country’s benchmark indices on the bourses seem to be reaching for the skies.

The bull charge is possibly goaded by expectations of a magic stimuli from the Reserve Bank of India by way of rate cuts around July. Even so, the celebration at the bourses ~ the Sensex closing above 40,000 and Nifty above 12,000 for the first time on the first working day of the week ~ was not just a little confusing.

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While the Sensex has a way of dismissing numbers; the finance ministry does not. The Central Statistics Office numbers, which the new finance minister, Mrs Nirmala Sitharaman, will have to deal with, show economic growth slowing to a five-year low of 5.8 per cent in the fourth quarter of 2018-19, courtesy a disastrous showing by the agriculture sector and a far-from-happy performance by manufacturing.

While the finance minister, getting ready to deliver her first budget speech on July 5, will address the causes of failure on the economic front, the Prime Minister must personally address the impact of this unhappy state of affairs on many things, not the least of which is the rate of unemployment. At 6.1 per cent for the fiscal year ended 2018, it is the worst in more than four decades and should worry Mr Narendra Modi because this army of the unemployed was a part of the constituency reaffirming its faith in him despite his failure to deliver on his 2014 employment generation promise.

Such faith will be sorely tested over the next five years, with an additional estimated 12 million joining the job-seekers annually. Regrettably, with not even 30 days left before the Sitharaman budget, one is not sure that the cabinet has collectively agreed on the reasons why the job front looks as bleak as it does or which sectors offer the best solutions.

Even the optimist foresees a substitution of labour with capital on a substantial scale under conditions of dropping employment elasticity in the country. The realist knows that given policymaking mindsets in the country, creation of jobs in the agriculture sector will take a back seat to ambitions in the manufacturing or service sectors. The pessimist rues that there is little dialogue on what sectors those charged with the skilling of 500 million Indians should focus on, given that even the few beneficiaries of the poorly-executed reskilling scheme were unsuited for the jobs available because India suffers from a poor labour market information system.

It is this strait that the government must cross before it can make a substantive difference. Regrettably again, such strait is best crossed with support from granular data diligently gathered from district levels; the centre at best analyzing data and providing guidelines. Failing this, the job-skill mismatch will be the undoing of any demographic dividend that India hopes to cash in on and there is nothing bullish about that.