Unemployment Crisis : Abolishing Privatization is The Only Solution!
Both Modi and Stalin say that attracting foreign investment will increase domestic employment. However, according to the “State of Working India 2026” report published by Azim Premji University’s Center for Sustainable Employment, the unemployment rate in India has been increasing for the past 40 years.
Unemployment is one of the biggest topics of debate and discussion in India. Since we are bound by production relations in which, for the profit of capitalists, we can only purchase the means of survival by selling our labor power to the capitalist class, work becomes essential for us to live.
Have the capitalist class, and the electoral parties who represent them politically, created employment opportunities for all of the labour force? When this question is posed, the answers given by rulers and the working masses pose two different answers that directly contradict each other.
On one hand, Modi says that he has attracted billions in foreign investment, created millions of employment opportunities, and turned India into the third-biggest economy in the world. Stalin, walking the same path, implements Modi’s economic model in Tamilnadu, boasts that he has boosted employment opportunities through his “Naan Mudhalvan” scheme. Private colleges lure students in with the promise of full-time employment after graduation. In short, the ruling class proudly declares that it works selflessly to create job opportunities for the youth entering the labour force.
On the other hand, various workers and labour groups are waging a struggle for permanent jobs and wage increases. Statistics point out the fact that, in the last 40 years, the unemployment crisis has only worsened. The Azim Premji University’s Center for Sustainable Employment published their “State of Working India 2026” report recently. The report provided information on the employment of youth in India, the status of their higher education, and the relationship between their higher education and the industrial demand for employment.
It said:
1. The unemployment rate for college graduated youth is at 40%; in the past 40 years, this rate has grown from 35% (1983) to 40% (2023).
2. Within a year of attaining a college degree, only 7% of graduates are being offered employment in permanent jobs (both in the government and private sectors). 43% of graduates are employed in temporary jobs, or jobs unrelated to their college degree. The remaining 50% of graduates stay unemployed during this time period.
3. The rate of higher education enrolment increased from 2004-2005 to 2017-18, and began to decrease from 2017-18 onwards. Male enrolment rate decreased from 38% to 34%. The reasons for this decline, according to the report, were the lack of jobs relevant to the degrees obtained by students, the increase in the cost of obtaining higher education, and the compulsion faced by prospective students to work before completing their education in order to alleviate the financial struggles of their families.
The details presented in the report about the employment and learning outcomes of higher education have once again exposed the hypocrisy of the ruling class’s propaganda about “development” and employment creation.
“Foreign direct investments into the Indian economy will create new industries. New employment opportunities will be created, and through these new industries and new jobs we will learn to use new technologies and new management practices. Domestic wage rates will increase, too.” This is what the ruling class repeats and promises as the formula for economic growth.
Whether it is the economic policies adopted during Congress’s rule, or the policies adopted during Modi’s rule such as ‘Make in India,’ the PLI scheme, ‘Amrit Kaal,’ and ‘Viksit Bhaarat,’ the fundamental economic mechanism is the inflow of foreign direct investments. Educational policy is tailored to aid the implementation and public acceptance of foreign direct investment under the guise of these different economic policies.
Therefore, the worsening of the unemployment crisis, the decline of higher education, the stagnation of real wages, and the migration of people from cities to villages (in search of agricultural work), are all caused by the implementation of privatization adopted in 1985 and pursued relentlessly since then in India. This is the brazen truth.
The report, however, does not speak about privatization, and only states that new policies and higher education programs need to be implemented for increasing employment opportunities. This is no different from the language spoken by Modi, state chief ministers, education ministers, and university professors in this regard.
The vice chancellor of Anna University stated that the institution is going to change the curriculum to meet the needs of industries in the economy (to create employment opportunities). BJP propagates that the National Education Policy (NEP) will elevate Indian higher education to global standards. Modi, along with Stalin and several other state chief ministers, say that legal amendments in line with the LPG policy are necessary for industrial growth and the creation of employment opportunities.
Their view is that unemployment can be reduced by fulfilling the demands of domestic capitalists, financial capital, and multinational corporations. But, is the reason for the unemployment crisis and the miserable state of private higher education the lack of economic, educational, and dearth of legal policies, or is it the policy of recolonisation which simply awaits foreign investments?
Generally, the foreign investments that enter a country don’t bring only the capital required to start new businesses and industries. It brings with it the conditions for reforms and regulations to be implemented in the country where the capital is invested.
Privatizing education, healthcare, and all other public services, as well as agriculture, industries, and commerce; removing all government regulations in those sectors and enacting legal amendments accordingly; these are the demands put forth by foreign direct investment.
To the extent that foreign direct investment flows into the Indian economy, the deregulation of private corporations and their actions proportionally takes place consequently. It was in response to the demands of American financial capital that the Modi government introduced the three agricultural laws, the labour code, and the nuclear reactor ‘Shanti’ bill.
The sole motive of foreign investors who make investments in India is to monopolize domestic markets and industries and to increase their profits by exploiting labour at very low wages. For example, American corporations like Apple declared that they will cease their production in China and move those operations to other countries due to the economic war between America and China, and Modi’s government invited these corporations to redirect their investments into India through the Production Linked Incentive (PLI) scheme.
Corporations that began production in India through this scheme like Foxconn receive a 6% subsidy of the cost of an Apple cell phone for each unit it produces. The cost of assembling a cell phone for Foxconn, in India, is only 4% of the cell phone’s price. The remaining 2% of the subsidy to Foxconn for the production of cell phones in India is a voluntary ‘reward’ payment by the Modi government to Foxconn for their redirection of investment and production into India.
If another country subsidizes Foxconn’s production more than India currently does, and offers labour power at even lower wage rates, Foxconn would inevitably shift its production base to that country instead. Foreign direct investment is like a swarm of locusts: they enter a country under the guise of growth and employment, loot its resources, and then move on to another country for another raid. This only increases the profits of foreign investors; it will not provide permanent employment to all educated people in a country where it invests. Labour created by foreign direct investment is precarious, because it only exists until the investment is redirected to other countries with even lower wage rates and greater foreign investment subsidies. However, education ministers, professors, policymakers, and government officials will ignore this truth and instead act as ideological agents for the ruthless exploitation enacted by capitalists under the guise of improving employment opportunities and improving higher education outcomes.
