Ex-RBI Governor urges India to prioritize job-rich growth over speed

Speaking to PTI, former RBI Governor D Subbarao stressed that India’s recent 7.8 % first-quarter expansion shows resilience, but the real challenge is making growth productive, employment-intensive and durable. He argued that private investment, labour-intensive manufacturing such as textiles and food processing, and improved human capital are essential to keep growth above 7 %. Subbarao noted that while domestic consumption remains strong and public infrastructure spending has spurred private investment, many jobs are still informal, low-productivity and poorly paid, leaving educated youth under-employed.

He warned that without broad-based income gains, consumer demand will stay weak, creating a vicious cycle for businesses. To address this, he urged policies that boost labour-intensive sectors, expand vocational training, and help small enterprises scale up, thereby turning India’s demographic dividend into a demographic advantage.