Wealth Creation and
Domestic Migration: Case
of India
Laveesh Bhandari (Indicus)
FNST, Jakarta
September 7, 2010
This presentation
Need
Likelihood
Problem(s)
Enabling Environment
The need for migration
Incomes will double in
next decade
Unequal economic
growth
Some areas require
greater human capital
Pressure on cost of Composite Index
2.30 - 3.82
1.80 - 2.30
1.25 - 1.80
human capital
0.46 - 1.25
Domestic migration is
the only viable solution
State Level Economic Performance
Need for Skills
The lack of skills to meet sustained growth
requirements is well known
It exists everywhere
And therefore high growth areas will draw
skills from everywhere
– perhaps further worsening regional imbalances
2004- 2008- 2015- 2020- 2025-
Nco1digit 05 09 16 21 26
0-1 Professional, Technical And Related Workers 13.9 15.5 18.7 21.4 24.7
2 Administrative, Executive And Managerial Workers 11.9 14.2 20.0 26.0 34.5
3 Clerical And Related Workers 10.3 10.3 10.6 11.2 12.4
4 Sales Workers 27.8 31.2 38.5 45.4 54.0
5 Service Workers 14.4 15.9 19.4 22.8 27.2
Production and Related Workers and Labourers –
7 Textiles, Garments, Food processing, Miners, etc. 18.3 19.8 22.9 25.4 28.3
Production and Related Workers and Labourers –
Metals, Wood, Stone, Glass, Plumbers and
8 Toolmakers, etc. 15.6 17.1 20.4 23.4 27.4
Production and Related Workers and Labourers –
9 Rubber, Paper, Transport, Construction, etc 41.1 52.7 86.3 127.0 191.9
10 Not Classified 0.9 0.9 1.0 1.0 1.0
Remainde Farmers, Fishermen, Hunters, Loggers And
r Related Workers 183.6 212.5 278.7 341.3 427.7
Total Total 337.9 390.1 516.4 645.1 829.0
The key problem
Wealth creation cannot occur if the
skills are mismatched
Skill creation requires 10-15 year gap
between demand and supply to be
matched
How to handle the intervening period?
Some Numbers
State 2021 2021-2011 2021-2011 2010 to 2020
Addition (%
Population % GSDP
15-59 (yrs) Addition Distribution) Distribution
Andhra 60.7 4.8 4.3% 9.0%
Assam 22.3 2.9 2.5% 1.2%
Bihar 69.2 11.7 10.4% 2.4%
Chhattisgarh 17.3 2.5 2.2% 1.7%
Delhi 16.8 4.1 3.6% 5.2%
Gujarat 43.5 5.4 4.8% 12.2%
Haryana 19.5 3.3 2.9% 4.8%
Himachal 4.8 0.4 0.4% 0.8%
J&K 8.5 1.0 0.9% 0.5%
Jharkhand 22.9 3.4 3.1% 1.9%
Karnataka 42.6 3.7 3.3% 6.1%
Kerala 23.4 1.0 0.9% 5.0%
MP 52.4 9.0 8.0% 2.1%
Maharashtra 83.5 11.0 9.7% 15.8%
Orissa 29.0 2.7 2.4% 3.0%
Punjab 20.0 1.9 1.7% 2.0%
Rajasthan 49.4 8.7 7.7% 4.1%
Tamil Nadu 46.2 1.6 1.4% 7.1%
UP 140.9 24.7 21.9% 5.6%
Uttaranchal 7.1 1.0 0.9% 1.1%
WB 65.1 5.8 5.2% 6.1%
All India 859.6 112.5 100.0% 100.0%
In-migration vs
outmigration
25.00%
20.00%
15.00%
10.00%
5.00%
0.00%
Andhra Bihar Karnataka MP Rajasthan UP
Workforce GSDP
Economic Freedom and
Migration
7.00
.
6.00
5.00
Out migration as % of Home Pop.
4.00
UP
3.00
Bihar
2.00 MP
Orissa
1.00
WB
Assam
0.00
0.00 0.10 0.20 0.30 0.40 0.50
Economic Freedom Index
Sustainable migration
Migrants do not have access to
– Public services (identification/residence)
– Political networks
– Employment networks
Rapid migration
– Opposition from local residents
– Language and cultural change
– Social upheavals
Out-migration locations
In-migration locations
Thank you