Indian Express Editorial Analysis

India’s Economic Credibility Challenge

Investment Struggles Amid Growth

• Growth vs. Investment: Despite 7% GDP growth and strong government efforts, private domestic investment and FDI are still below expectations, raising concerns over economic credibility.

Ideological Influence on Economic Policy

• Morality in Economics: Economic policies often appear driven by ideology rather than demand realities, relying on statements to boost investment sentiment, similar to RBI’s “Open Mouth Operations.”

Four Key Credibility Gaps

1. Epistemic Credibility Gap
   • Inconsistent Data Interpretation: Conflicting RBI reports and surveys, especially on consumer confidence, undermine faith in economic data.
   • Overestimated Middle Class: Systematic overestimations erode confidence in India’s economic assessments.
2. Regulation Credibility Gap
   • Ease of Doing Business: Despite claims of reforms, foreign investors view India’s regulatory environment as complex and challenging.
   • GST & Tax Reforms: Rather than simplifying, these have added uncertainty, with corruption resurging.
   • KYC Norms Issue: KYC regulations prevent thousands from accessing funds, hurting the credibility of regulatory reforms.
3. Capital Concentration in India
   • Effect on Small Enterprises: Policies like GST have negatively impacted small businesses.
   • Top-Five Dominance: Concentration of power in a few large firms post-2015 has led to concerns about state-capital relations, signaling risks for investors.
4. Governance Credibility Gap
   • Infrastructure vs. Planning: While highways have improved, issues like urban flooding reveal gaps in planning, affecting investor confidence.
   • National Capacity Inconsistencies: Inconsistent governance quality impacts the overall perception of India’s economic stability.

Conclusion

• In Need of True Credibility: Without addressing credibility gaps, relying solely on rhetoric weakens investor confidence, suggesting economic leaders may lack the pragmatism needed to inspire trust.

 

 

Indian Express Editorial Analysis

Engineering the Future: A Surge in BTech Seats

Rising Intake in Engineering Education

• 2024-25 AICTE Data: Undergraduate engineering intake up by nearly 19% compared to 2021-22, marking a reversal from a decade of decline.
• Past Challenges: Previously low demand led to a reduction in seats and forced several colleges to close.

Historical Issues in Engineering Education

1. Institutional and Regulatory Gaps
   • Lack of Resources: Many colleges lacked essential infrastructure, qualified faculty, and functional labs, impacting education quality.
   • AICTE Oversight: A 2017 investigation cited corruption and regulatory lapses as factors in declining standards.
2. Employment Hurdles for Graduates
   • High Unemployment: Approximately 48% of graduates face employment challenges due to insufficient practical training.
   • Impact on Initiatives: The skills gap has hindered initiatives like Make in India, aimed at enhancing domestic manufacturing.

Research & Development (R&D) Deficit

• Low R&D Investment: India invests only 0.7% of GDP in R&D, significantly lower than developed countries (e.g., South Korea’s 5%+).
• Impact: Limited R&D spending curbs technical skills advancement and innovation in engineering.

National Education Policy (NEP) 2020: Way Forward

1. Industry-Academia Linkages
   • NEP Vision: Promotes partnerships to secure resources for technical education.
   • Emerging Fields: AICTE mandates align with NEP, encouraging courses in AI, robotics, data sciences, and cybersecurity.
2. Faculty Quality and Training
   • Faculty Retention: Recruiting and retaining quality educators is crucial.
   • Training Recommendations: NEP advises using IIT expertise to train faculty in smaller colleges; AICTE is recommended to implement NEP’s proposal for teacher training institutes to upgrade skills.