1 Introduction 1

2 China’s and India’s economic paths 3

3 China’s development model and future growth prospects 5

4 India’s growth model and challenges ahead 7

5 India’s biggest sustainable growth challenge: the impending job crisis 12

6 India’s still-underutilised job-creation levers 15

6.1 Sluggish manufacturing sector 15

6.2 The exports conundrum 16

6.3 Lacklustre FDI inflows 21

6.4 Limited resources for innovation 24

7 India’s way forward to resolve the jobs crisis 26

7.1 Greater openness to trade 27

7.2 Attracting foreign direct investment 30

7.3 Incentivising job creation in manufacturing 32

7.3.1 The Production-Linked Incentive (PLI) initiative: progress, but not enough 32

7.3.2 The new labour codes: what to expect 33

7.4 Education reform and innovation to reduce the skill mismatch 34

7.5 Reducing policy uncertainty 35

8 Conclusion 36

References 38