Q19.Account for the failure of the manufacturing sector to achieve the goal of labour-intensive exports rather than capital-intensive exports. Suggest measures for more labour-intensive rather than capital-intensive exports.

India's manufacturing sector struggles to achieve labour-intensive exports, missing opportunities for job creation and inclusive growth despite its vast workforce.

Factors hindering labour-intensive exports

• Policy bias towards capital-intensive industries and large-scale manufacturing over MSMEs.
• Rigid labour laws and inadequate skill development hinder formal employment and productivity.
• Infrastructure bottlenecks (logistics, power) and limited credit access for small enterprises.
• Intense global competition and increasing automation impact traditional labour-intensive sectors.

Steps to boost labour-intensive exports

• Implement labour law reforms and targeted skill development programs to enhance employability.
• Promote MSMEs via easier credit, technology upgradation, and market linkages.
• Formulate sector-specific policies for labour-intensive industries (e.g., textiles, leather).
• Improve export infrastructure and streamline trade procedures for competitiveness.

Prioritizing labour-intensive exports is crucial for India to leverage its demographic dividend and achieve sustainable, inclusive economic development.