Editorial 1: Growth & Tier-2 city
Context:
- As the fastest-growing large economy in the world, India has high growth and potential in the multiple spheres of economy
- As, more than 50 per cent of India’s population is below the age of 25 and more than 65 per cent is below the age of 35, But with nearly a quarter of the youth being unemployed,
- The coexistence of high economic growth and high unemployment draws attention.
Young demographic is an asset for Indian which need to be utilised effectively
- India’s young demographic is an asset in an ageing world, and changes in the trajectory of globalisation have opened new doors for India. For the utilisation of it, India needs good infrastructure, both physical and human, to create more jobs.
- The country has made huge progress in improving its physical infrastructure but has fallen behind on human infrastructure like education and skills.
- Physical infrastructure in the absence of good human infrastructure has slowed the pace of job growth.
- Physical infrastructure investments are also focused on urban areas, but the manufacturing sector is migrating away from urban to rural areas to remain cost-competitive.
- However, poor physical and human infrastructure in rural areas has constrained the growth drivers and limited the size of the manufacturing sector in India.
Challenges with respect to human infrastructure
- India has the largest concentration of illiterate people in the world. More than one-third of India’s adult population remains illiterate, and less than 20 per cent have completed secondary education.
- The challenges are enormous in rural areas. They are also multidimensional access, quality, relevance, finance and governance.
- Despite a few excellent public and private universities in India, concerns have been raised about the quality of education due to a huge variation in the quality of graduates from both the public and private systems.
- As, effective systems of quality assurance do not exist, either for the public or the private sector.
- Compounding this problem is a shortage of qualified faculty due to
- poor compensation,
- rigidities in the number of places allocated to different disciplines in the public system,
- outdated curricula and pedagogical methods that still rely too much on rote learning rather than creative thinking and problem-solving and teamwork that is needed by the market
- Returns to investment in education are much higher than the returns to investment in physical investment. The average social rate of returns to primary education is nearly 20 per cent and returns to higher education are increasing rapidly.
Steps need to be taken to scale up investments in human infrastructure, particularly education
- As the education system becomes more complex with multiple players and multiple pathways, the governance of the education system needs to be improved, and new and better systems must be established.
- It needs better incentives, monitoring, performance assessment, and accountability both for the internal processes of the education process as well as for students.
- A key challenge is to scale up tertiary education. This will increase the cadres of professionals who can create new enterprises and maximise job creation.
Policy maker need to investment in education for job creation
- Policymakers need to recognise that investments in education will accelerate the pace of job creation.
- Most of the jobs are created by new enterprises, and enterprises, both domestic and foreign, look for both skilled workers and a good physical infrastructure.
- Given India’s large youth bulge, the potential to benefit from education is huge. Education and skills are becoming more important as new enterprises make their location decisions based on the education and skills of the local workforce.
The future of economic growth lies in tier II cities
- In the early 1990s, India’s manufacturing sector walked hand in hand with urbanisation.
- This process has reversed from 2000 onwards, with the pace of de-urbanisation of manufacturing gathering momentum.
- Industrial firms are choosing to locate in rural areas due to a combination of cheaper land prices, lower pollution restrictions, weaker congestion and other spatial factors.
- The future of economic growth will not be in tier I cities, which are already dense with India’s best and brightest, but in tier II cities.
- New cities have the potential to generate 70 per cent of the country’s new jobs and GDP over the next 20 years a process that could drive a four-fold increase in per capita incomes.
- In China and the USA, intermediate cities have become the new drivers of growth and job creation. Globally, manufacturing has been dispersing from high-density clusters to less dense areas.
Conclusion
- India needs a broader focus on rural structural transformation to accelerate job creation. This can be achieved if policymakers can scale up physical and human infrastructure investments to build the missing links between urban and rural India.
- The de-urbanisation of the manufacturing sector has scaled up the importance of rural development and job creation agenda.
Editorial 2: India’s new car safety rating protocol
Recent Context:
- Recently, India launched its own crash test rating assessment system that will come into effect from October 1. With the implementation of norms, Indian will join half a dozen other countries and geographies that have these norms.
- A crash test is a collision of a vehicle in a controlled environment to assess its safety parameters.
- The norms define safety standards of motor vehicles with type approval for seating up to eight people, and with a gross weight of less than 3.5 tonnes, which are either manufactured or sold in the country.
- The standards will offer customers an objective metric to compare the crash safety of vehicle models before buying, and will nudge manufacturers to progressively improve the safety ratings of models.
Testing protocol, scores
- The Bharat NCAP testing protocol is aligned with global crash test protocols, and will have ratings from 1 star to 5. The higher the NCAP score (stars) the safer the car.
- Evaluation will cover
- Adult Occupant Protection (AOP),
- Child Occupant Protection (COP)
- Fitment of Safety Assist Technologies.
- For this, three tests will be conducted: a frontal impact test, a side impact test, and a side pole impact test.
- Based on the vehicle’s performance in these tests, the model will be offered separate star ratings for AOP and COP.
Format of the testing
- To begin with, the exercise will be voluntary. Carmakers will be encouraged to offer their models for testing as per the Automotive Industry Standard (AIS) 197.
- Once the manufacturer offers a vehicle model for crash testing, the manufacturing facility will be visited by a Bharat NCAP team that will pick a base variant of the model through random sampling.
- This vehicle will be taken to the Bharat NCAP testing centre, and put through the crash test in the presence of the manufacturer’s representatives. The results will be compiled and shared with the manufacturer.
- After a Bharat NCAP standing committee approves the entire process, the crash test results and the star rating of that vehicle will be published.
- The parameters under review include an assessment of the car’s structural integrity in the event of a frontal collision or a sideways impact, provision of active and passive safety assist technologies, safety of adult and child occupants in the vehicle, and the vehicle’s overall pedestrian-friendly design, which will be used to determine the final rating.
Why testing of vehicle is important
- So far, carmakers have been shipping models abroad for testing and star grading, an expensive and time-consuming affair.
- These tests largely covered petrol and diesel cars. Bharat NCAP will also test and rate CNG and electric vehicles based on their crash performance.
- The new norms could lead to
- an improvement of the quality of cars sold in the country, and
- the export-worthiness of India-made automobiles.
- Over time, the programme is expected to catalyse a change in consumer behaviour and lead to an increase in the demand for safer cars,
- nudging manufacturers to increase focus on safety.
Global NCAP, and India’s
- The Bharat NCAP norms are aligned with the format of the Global NCAP, which worked with the Ministry of Road Transport and Highways in formulating the Indian edition of the crash tests.
- Testing a car under the Bharat NCAP programme would cost around Rs 60 lakh, while a similar test overseas would cost around Rs 2.5 crore,
- Global NCAP did not inform manufacturers about the tests, and picked cars from showrooms while this caused considerable heartburn for players in the Indian auto sector, as a result most Indian carmakers have embraced the launch of Bharat NCAP as a positive step.
Conclusion
- India is the 3rd largest automobile market in the world in terms of sales and has immense future potential .
- Recently, introduced new car safety rating protocol is a significant step in right direction as any car that is launched in India follows the mandatory safety standards set by the government.
- Therefore, For consumers seeking extra safety information, the Bharat NCAP system is an authentic and objective rating system to empower the customer to make an informed choice