Microfinance India Summit 2009

1. Skilling India
Issues, Challenges and Opportunities
Hotel Taj Palace
New Delhi
October 28th, 2009

2. Background
•India
– GDP 1 trillion; Double in next ten years
– Why doesn’t it feel right? Growth vs. Poverty
• Five Labour Market Transitions
– Farm to Non-Farm
– Rural to Urban
– Unorganized to Organized
– Subsistence self-employment to Decent wage employment
– School to Work
• Context
– People supply chain company out of inventory; open positions, Jaipur
– Market failure
– Population repackaged

3. Human Capital
• Learning's
– Reforms lifts all boats but some reforms makes boats seaworthy
– Radical Revamp of 3E’s (Education, Employability, Employment)
• Three Problems
– Immediate Matching Connecting Supply to demand
– Medium Term Mismatch Repairing Supply for demand
– Long Term Pipeline Preparing Supply for demand
• Innovation at Intersection
– Public, Private, NGO
– Financing, Delivery, Certification
– Education, Employability, Employment

4. What is the problem?
Poor Education Regime
Architecture;
Low penetration
Delivery
of education
Systems
Low/ Uneven Not work
returns to ready; BA
education
10+2+3;
Quantity vs. Few on/off
Quality trade-off ramps, Multiple
intelligences
Regulatory;
Accreditation
heavy but
outcome light

5. What is the problem?
Poor Employability Regime
Financing vs.
Outcomes Market
Financing vs. Failure
Delivery
Centre
Repair different regulates but
from Prepare; 6mo state delivers
Apprentices;
Not self- Learning by
healing; NOC doing/ while
code mismatch earning
Entry Gate/
Exit gate

6. What is the problem?
Poor Employment Regime
Employment
Elasticity; labour Unions; Minority
Saving bias rule
No Backpack
Missing Middle; Benefits
hero/ zero?
Defunct
Unorganized
Employment
Sector
Exchanges
Subsistence
self-
employment

7. Why are these related and urgent?
India
Lopsided GDP; Equality of
agricultural opportunity;
productivity Naxalites?
Inability to
Next 10 years; afford social
1/4 security
Geography of
Labour market work; 6 lac,
Outsider Access Blr vs Manipur
Migration;
People to Jobs

8. Questions
• Employers
• Getting a return on investment; 3 holes
• Free rider problem
• Is manufacturing employees a core or non-core activity?
• Private Trainers
• Is the business model sustainable with yield?
• Unpack; financing vs delivery, focus?
• NGOs
• Self-employment
• Inch wide mile deep vs. mile wide inch deep; focus?
• Baby vs Dwarf
• Public Policy
• State vs Centre
• 19 ministries vs 2 human capital ministries
• Moving from outlays to outcomes

9. The Agenda
Matching
Exit
Employment Gate; Credible
Exchanges; Career certification,
Centres, PPPs Signaling
Apprenticeships; Entry gate;
Jaipur mela, Assessment
blending
Employment
Intensity; labour
laws

10. The Agenda
Mismatch
Separate Repair
from Prepare; Use students as
3 kinds of financing vehicles
Unemployability
Measure and
publicize outcomes; Separate financing
Information from delivery
Asymmetry
Link financing to
outcomes;
pay for yield

11. The Agenda
Mismatch
Create Asset Bank Activate NSDC
Performance Financing
Management Innovations
Using Technology
for scalability,
consistency,
support

12. The Agenda
Mismatch
Job Framework; Enforce operating
Redo NCO, principles
Curriculum vs. ICP
Ramp state skill
Ramp MES missions
Tweak ITI PPP
policy, New scheme

13. The Agenda
Pipeline
Quantity vs. Quality Regulatory
SSA Revamp
Learning for English;
earning; Windows, Migration
6 mo vs 15 years
On & Off Ramps,
Fungibility

14. Reflections - Public Policy Campaign
• Binding Constraint; 30% of time
• Challenges
– No MOE; politicians one-innings game, bureaucrats too small/big
– “Distributional coalitions”; Unions, Status Quo
– Concurrent list vs. Delivery systems; 1 PM vs 10 CMs?
– Unwillingness to make 2nd best choices; price, excellence, quantity
– Reform not good politics yet; know about reform
• Learning's
– Satyagraaha argument works; Million negotiations of democracy, CNBC
– Solution not in Totalizing or Micro-fragmenting
– No. of statistically independent tries; Policies and Projects, Private and
Public, Financing and Delivery, Thinking and Doing; Woody Allen
– Private sector cannot substitute for state; ISB, State cant do everything
– But public policy is key; seen Government in 4 roles
– Strategy; Akbar’s Horse

15. Closing Thoughts
• India
– WSJ in 1994
– Unique Time in India
– Missed tryst with destiny; 300 million
– Sins of Omission vs. Commission
– Change in democracy?
• Way Forward
– Move into execution; all ideas on table
– Resource question overrated; not more cooks, end stereotypes
– Unique entrepreneurial opportunity, triad
– Daily spectacle of tragedy; losing their future
– Talk in third person. Who? When?

16. Skilling India
Issues, Challenges and Opportunities
Hotel Taj Palace
New Delhi
October 28th, 2009