india job market: India, the choice for global talent?

India’s population will peak after most developed nations. That will make it a late entrant into the market for migrant labour. It will face a settled world order of labour movement to economies now ageing. These countries have the advantage of established welfare systems and decades of structured immigration. India has neither. However, it offers opportunities to foreign workers in high-end manufacturing, services and the knowledge economy. This bridges some of the domestic skills gap that weighs on the economy’s potential to grow. It also smoothens India’s economic transition to an adverse age-dependency demographic. An immigration policy directed at improving productivity will speed up development and climb the value chain in manufacturing and services faster.

A structured immigration policy has a positive spin-off – it involves creating the ecosystem that, in effect, arrests migration. This means creating an academic and research environment to compete with those that draw Indians abroad. These institutions then have to feed into industry that creates the right kind of jobs. Social security needs to be upgraded alongside improved cultural assimilation. The fiscal effects are broadly positive – in India’s case, the hurdle may be higher to harmonise the social and economic environments. All the more reason to plan early for the eventuality of Indians growing old before they become rich.

Tech is bringing forward timelines. AI is set to disrupt the job market just about the time countries reach a critical phase of labour shortages. As competition for talent intensifies, there will be attempts to hoard skills in demand in a post-AI world. India’s advantage in skilling its workforce will diminish in a couple of decades. It should, by then, have established itself as a base for suitable immigrants. The scale of India’s ageing will have to be tackled through tech adaptation and its attendant immigration. This is as good a time to set the ball rolling to make India the country of choice for high-end global talent.