India’s economic growth has been remarkable in recent years, earning it the title of the world’s fastest-growing major economy. Yet, beneath this headline success lies a significant challenge: job creation. As India’s population continues to grow, so does the need for employment, particularly in sectors that can absorb large numbers of workers. This is where the focus on labour-intensive exports becomes crucial. Historically, labour-intensive industries like textiles, leather, and apparel have played a vital role in job creation. However, India’s performance in these sectors has faltered. Countries like Bangladesh and Vietnam have capitalised on China’s gradual withdrawal from labour-intensive manufacturing, gaining market share in global exports.

Meanwhile, India’s share in global apparel exports has slipped, indicating missed opportunities in industries that could have provided much-needed employment. The issue isn’t a lack of demand for Indian goods. In fact, there are untapped markets in regions like Africa and Latin America where Indian textiles, footwear, and other labour-intensive products could thrive. These markets represent an opportunity for India to diversify its export base and, more importantly, create jobs. One of the key recommendations to boost labour-intensive exports is leveraging India’s Production Linked Incentive (PLI) policy. By offering targeted incentives, India can attract investors to low-skilled manufacturing sectors that have higher job creation potential. The PLI policy has already shown promise in high-tech sectors, and expanding its reach to labour-intensive industries could be a game-changer for employment generation.

However, it’s not just about incentives. India’s integration into global value chains is equally important. The country has often relied on protectionist measures, such as high import tariffs, to shield domestic industries. While this approach may have short-term benefits, it hinders India’s ability to compete globally. Reducing import tariffs and fostering greater participation in global value chains would make Indian exports more competitive and open up new opportunities for growth. The urgency of these measures cannot be overstated. India’s urban unemployment rate remains alarmingly high, and without significant intervention, the demographic dividend that the country once touted as its strength could become a liability.

Job creation in labour-intensive sectors is not just an economic necessity; it is a social imperative. Furthermore, as India navigates its path towards becoming a global economic powerhouse, it must ensure that growth is inclusive. High-tech sectors may generate impressive revenues, but they cannot absorb the millions of young workers entering the job market each year. Labour-intensive industries, on the other hand, offer the dual benefits of economic growth and widespread employment. India’s focus on labour-intensive exports could be the key to unlocking both job creation and sustained economic growth. By targeting untapped markets, reducing barriers to trade, and leveraging policies like the PLI, India can revitalise its manufacturing sector and ensure that its growth story benefits all sections of society. The time to act is now, before more opportunities slip away.