Investing in human capital need of the hour: Raghuram Rajan

Hyderabad: Timely focus on the untapped human capital is pivotal to India’s economic growth, said Raghuram Rajan, former governor of the Reserve Bank of India, while discussing his latest book, ‘Breaking the Mould: Reimagining India's Economic Future’, at the Hyderabad campus of Indian School of Business (ISB).

He said, “We have to focus on India’s most important asset, which is its human capital. We have 1.4 billion people, more than any other country in the world. If we can train a large number of these people well, we have access to so much in terms of value creation! I would say, let’s start with that.”

The book, ‘Breaking the Mould’, which he has co-authored with economist Rohit Lamba, gives a reality check on the processes and approaches adopted in India and comes up with practical and realistic paradigms that can fast-track growth story and foster innovations and out-of-the-box growth models. Speaking on infrastructure development in India in recent years, Rajan stated that India’s deficiency historically has been implementation. “The point simply is that we have lot of plans; we implement fewer of them. But, as far as infrastructure goes, the government has implemented its plans,” he said.

He also spoke about the need to address problems such as malnutrition to ensure growth in the medium term, before making bigger plans. The children who are suffering from malnutrition now would join the labour force 10 years from now, he underlined.

In advice to young people, including ISB students present, he noted that most youngsters look for jobs rather than creating jobs. “You can do the multiplier effect by taking up entrepreneurship. This is what people expect from business schools,” he stressed. Prior to the book discussion, Rajan attended the ISB-NBER annual conference on Economic Policy and the Indian Economy. The conference, a collaborative effort between ISB and NBER. witnessed discussions by over 20 noted economists and experts.