India needs to create 148 million additional jobs by 2030 given population growth, says IMF DMD Gopinath

India has been a laggard among G20 nations in terms of employment generation, and the country needs to create an additional 148 million jobs by 2030, given the population growth, IMF's First Deputy Managing Director (DMD) Gita Gopinath said today.

India, on an average, grew at 6.6% for the decade starting 2010, but the employment rate was under 2%, she said at the Delhi School of Economics Diamond Jubilee event here.

So, India's employment rate is much less when compared to other G20 nations, she said.

"If you look at India's projections in terms of population growth, India will have to create anywhere between 60 million to 148 million additional jobs cumulatively between now and 2030. We are already in 2024, so in a short period of time we have to create a lot of jobs," she said.

Given the scale of what is needed, it is going to require basic reforms including land reforms and implementation of labor codes. To generate more jobs, she said, there is a need for an increase in private investment, as it is not commensurate with 7% growth in GDP.

However, she said, public investment is going well, but private investment has to improve. She also said that India should revamp its education system, so that it can improve the skill set of its workforce.

Besides, she added that there is a need to further facilitate ease of doing business, improve the regulatory environment and broaden the tax base. Gopinath acknowledged the vibrancy of the Indian economy and the strength of the country's relationship with the IMF.

FM Sitharaman said India deeply values its relationship with the IMF, and the government is open to exploring more ways to increase collaboration. IMF, in its outlook released last month, raised India's growth projections for 2024 from 6.8% earlier to 7%.

For the year 2025, the IMF projected India's growth rate at 6.5%. It attributed robustness and strength in domestic demand, and a rising working-age population behind its growth projections.

According to official data of the Indian government, the country's GDP grew at an impressive 8.2% during the financial year 2023-24, and it continued to remain the fastest-growing major economy. India's economy grew 7.2% in 2022-23, and 8.7% in 2021-22 respectively.

The Reserve Bank of India, in its latest monetary policy meeting, raised the GDP forecast for the current for 2024-25 to 7.2 % from 7 % earlier. The World Bank too, upwardly revised India's GDP growth forecast for the current financial year 2024-25 by 20 basis points to 6.6 %, from its earlier projection of 6.4 % made in January.

It also said India will remain the fastest-growing of the world's largest economies, although its pace of expansion is expected to moderate.