India's main challenge is skills gap for young workforce, says FM Nirmala Sitharaman

India is grappling with a significant skills gap among its young workforce, a challenge that Finance Minister Nirmala Sitharaman addressed during her recent visit to New York. Speaking at an event hosted by The Economic Club of New York, she emphasised the urgent need for enhancing employability through improved skill sets tailored to meet the demands of the job market as detailed in a report by Bloomberg.

Sitharaman stated, "The biggest challenge that we had is the employability level or the skill set which is so required." She pointed out that many businesses report that graduate students often lack the necessary skills to be effective in their roles. "For being employed, they need something more and it is that gap that the government of India is trying to now fill," she added.

The finance minister's remarks come at a time when India is focusing on skilling initiatives aimed at bridging this gap. With a vast young population, enhancing employability through targeted training and education has become a priority for the government, the Bloomberg report added further.

Navigating global economic challenges

In addition to addressing domestic concerns, Sitharaman spoke about the broader global economic landscape and its implications for India. She noted that while previous decades were characterised by broad multilateral trade, the future will likely be shaped by strategic economic partnerships. "India is well-poised to take advantage of this transition," she asserted.

As nations re-evaluate their supply chains in response to geopolitical shifts, India aims to position itself as a key partner for countries looking to diversify their sources of goods and services. This strategic pivot could provide significant opportunities for Indian businesses and enhance the country's role in global trade.

During her visit, Sitharaman chaired the Tech Leaders Roundtable and engaged with leaders from various sectors, including a discussion on investment opportunities at the New York Stock Exchange. She also participated in a fireside chat with IBM Chairman and CEO Arvind Krishna, focusing on India's ongoing economic reforms and growth trajectory.

Addressing global uncertainties

Sitharaman did not shy away from discussing the multiple global challenges currently facing economies worldwide. She highlighted issues such as ongoing conflicts in West Asia and Ukraine, potential dollar liquidity shocks, trade wars, and rising oil prices. These factors, coupled with China's growing influence, necessitate a protective approach towards domestic production. To grow nations will have to work in a strategic and planned manner.

In her discussions with Citibank CEO Jane Fraser, Sitharaman explored the future of India's banking sector in light of recent reforms. They also delved into the role of artificial intelligence in critical areas such as agriculture and urban development, showcasing India's potential as a burgeoning hub for pharmaceuticals and technology.

Looking ahead

Following her engagements in New York, Sitharaman is set to head to Washington, DC, for the Annual Meetings of the International Monetary Fund (IMF) and World Bank. She will also participate in discussions involving G20 Finance Ministers and Central Bank Governors.

As India continues to tackle its skills gap issue amidst shifting global dynamics, the government's proactive approach may pave the way for enhanced employability and economic resilience in an increasingly competitive landscape.