24 February 2025 : The Hindu Editorial Analysis

The Hindu Editorial: February 24, 2025.

1. Indian industry needs innovation, not mindless toil

(Source – The Hindu, International Edition – Page No. – 8)

Long Working Hours for Industrial Workers in India

• Many industrial workers in India work 11 to 12 hours daily in garment and auto-component factories.
• During peak production times, workers do not get any breaks for days.
• Outside of work, their time is spent on commuting and household chores.
• Despite this, some corporate leaders in India advocate for even longer working hours.

High Informality in Employment

• The Periodic Labour Force Survey (2023-24) found that only 21.7% of Indian workers have regular salaried jobs.
• The majority are casual workers or self-employed, with half of the salaried workers lacking formal job contracts, paid leave, or social security benefits.
• Most workers in India already work long hours for low wages without basic protections.

Dependency on Cheap Labour Over Innovation

• Indian industries rely on cheap labour rather than technology and innovation for competitive advantage.
• In developed countries, higher productivity is achieved through superior technology and efficient management, not excessive working hours.
• According to ILO (2024) data, the average weekly working hours were:
  • 38 hours in the U.S.
  • 36.6 hours in Japan
  • 46.7 hours in India

Shift from Organised to Unorganised Sector

• Indian industries have shifted production from large, regulated factories to small, unregulated units to avoid labour laws.
• Over 70% of India’s manufacturing workforce (68 million in 2021-22) works in small, unregistered enterprises (less than 10 workers).
• These small units function as part of supply chains for larger firms, producing components used in various industries.

Challenges Faced by Small Firms

• Small firms supplying parts to large firms face delays in receiving payments, causing financial strain.
• They are forced to accept low prices despite rising material costs, leading to a race to the bottom in competition.
• Lack of state support, bank credit, and rising competition from imports has further weakened small businesses.

Increase in Contract-Based Employment

• Factories increasingly hire workers through contractors instead of employing them directly.
• Since 2011-12, 56% of new factory workers are contract workers, who receive lower wages and have no labour law protection.
• Migrant workers, who move from villages to cities, make up a large part of this low-wage workforce.

Declining Wage Growth vs. Rising Corporate Profits

• Migrant workers earn low wages due to social disadvantages and lack of assets or benefits.
• Meanwhile, profits in India’s factory sector rose from 31.6% in 2019-20 to 46.4% in 2021-22, especially after COVID-19.

India’s Garment Industry Struggles

• Despite abundant cheap labour, India’s garment industry has not performed well globally.
• India’s share in global garment exports has remained stagnant at 3.1% for two decades.
• Other countries like China, Bangladesh, and Vietnam have outperformed India in garment exports.
• The reluctance of Indian manufacturers to modernize and innovate has held the industry back.

Negative Impact of Cheap Labour Model

• Industries over-relying on cheap labour fail to grow in the long run.
• India’s IT sector and other industries lack innovation because businesses prefer low wages over new technology.
• Low wages reduce workers’ purchasing power, weakening the domestic market and slowing economic growth.

Conclusion

• Overworking employees harms their health and productivity.
• The short-term profits gained through cheap labour will harm industry growth in the long run.
• Indian industry must invest in innovation and technology instead of stretching workers to their limits.

2. Talent shortage — global challenge, India’s opportunity

(Source – The Hindu, International Edition – Page No. – 8)

Future Workforce Challenges and Opportunities

• The global labour market is not fully prepared for the future, as the skills needed in 2030 will be different from those of today.
• A study by FICCI-KPMG estimates a global shortage of over 85.2 million skilled workers by 2030, leading to $8.45 trillion in unrealized economic potential.
• This shortage presents both a challenge and an opportunity for India to supply skilled workers to global markets.
• India must take proactive steps to ensure its workforce is well-prepared to fill this demand gap.

Key Global Regions with High Workforce Demand

• The Gulf Cooperation Council (GCC), Europe (including the UK), and Australia will have the highest demand for skilled workers.
• Workforce shortages will differ across regions:
  • Healthcare will see high demand globally due to aging populations.
  • Manufacturing and construction will be crucial for the GCC and Australia.
  • Service sector jobs will be the focus for Europe.
• Emerging sectors like automation, AI, big data, predictive analytics, IoT, blockchain, resource efficiency, and sustainability will require skilled professionals.

Barriers to Workforce Mobility

1. Regulatory and Immigration Barriers – Complex visa processes and strict work permit regulations hinder migration.
2. Recruitment Malpractices and Human Trafficking – Exploitation of migrant workers poses serious threats to their rights and safety.
3. Policy Barriers and Skill Mismatches – Many Indian degrees are not recognized globally, particularly in medicine, leading to underemployment.
4. Language and Cultural Barriers – Difficulties in adapting to new work environments affect productivity and workforce efficiency.

India’s Efforts to Address the Challenge

• Bilateral Agreements and Free Trade Agreements (FTAs) – Agreements with GCC nations ensure better protection for Indian workers.
• Skill Development Programs – Training programs align Indian workers’ skills with international job market needs.
• Digital Workforce Platforms – Online recruitment systems help protect workers from fraudulent practices, particularly in GCC countries.

Strategies to Maximize India’s Global Workforce Potential

• Sector-Specific Skill Training – Training programs should focus on the needs of specific countries and emerging industries.
• Regulation of Recruitment Practices – Stricter oversight of recruitment agencies is essential to prevent worker exploitation.
• Recognition of Qualifications – International cooperation is needed to ensure Indian degrees are accepted globally.
• Public-Private Partnerships – Collaboration between government and private firms can enhance training programs and employment opportunities.
• Promoting Circular Migration and Mobility – Temporary work visas and rotational workforce models can help address labor shortages without demographic imbalances.

Changing Immigration Policies and India’s Advantage

• Immigration policies worldwide are constantly evolving:
  • Europe may impose stricter immigration rules.
  • Australia remains more open to skilled migration.
• Despite increasing anti-immigration sentiments in some regions, Indian workers are generally welcomed due to their skills and professionalism.
• Preventing illegal migration will help protect Indian workers from exploitation and improve India’s reputation as a reliable supplier of skilled labor.

Conclusion

• Ensuring a strong presence in the global labor market will support India’s vision of becoming a developed economy.
• Estimates suggest that India’s GDP could reach $6.5 to $9 trillion by 2030.
• India’s ability to move toward the higher end of this projection depends on how effectively it captures a share of the $8.45 trillion global economic opportunity. 

3. A new age of imperialism

(Source – The Hindu, International Edition – Page No. – 9)

Challenges to the Rules-Based International Order

• The global system that governed relations between countries is under severe strain.
• A major turning point was when a permanent member of the Security Council violated the UN Charter by invading a neighboring country in 2022.
• The international system was built on three key principles: economic integration, collective security, and self-determination.
• The shift in support from a major global power, now echoing the aggressor’s stance, has significantly weakened the UN-based global governance structure.

Formation of the Post-World War II Global System

• After World War II, global powers decided to establish an international organization for collective security and peacekeeping.
• During 1941-1945, major powers agreed to the structure of this system through several conferences.
• In 1943, key global leaders envisioned a world order enforced by four major countries, later expanded to include another power.
• The system aimed to create a rules-based order where all states were treated equally, avoiding an outright victor’s peace.
• However, in reality, spheres of influence were recognized, allowing some powers to dominate certain regions.
• Despite flaws, the system provided predictability in international relations and promoted principles of sovereign equality.

Disruptions to the Global Order

• Recent policy shifts by a global leader have weakened international agreements and disrupted economic cooperation.
• Withdrawal from major global agreements and organizations has undermined established international norms.
• Unilateral trade actions have thrown the global trading system into uncertainty.
• A shift toward nationalist foreign policies and economic interests has further destabilized the system.

Repercussions for Global Security

• A major realignment in global alliances has occurred, with renewed diplomatic ties between two key powers.
• The approach to the ongoing conflict in Eastern Europe has changed, sidelining the affected country in peace negotiations.
• A shift in alliances is forcing European nations to take responsibility for their own security.
• Recent diplomatic discussions resemble past agreements where powerful nations divided influence over different regions.

Impact on Global Power Dynamics

• The shift in global leadership signals a return to might-based diplomacy, rather than rule-based cooperation.
• There are concerns that a new imperialist era may be emerging, with large powers expanding influence.
• The world appears to be dividing into regional spheres of influence, with different powers controlling specific regions.
• A major Asian power, which has supported ongoing conflicts indirectly, now faces fewer restrictions.

Implications for India and Regional Stability

• The security situation in East and Southeast Asia is increasingly uncertain, especially regarding territorial claims.
• A major shift in security commitments from a global power may encourage aggressive actions in the region.
• India must prepare for a more uncertain geopolitical environment, especially concerning longstanding territorial disputes.
• The erosion of the rules-based global order means smaller nations must navigate an unstable and unpredictable international landscape. 

Read more – 24 February 2025 : The Hindu Editorial Analysis