July 16, 2018 Yes Institute

YES BANK: Embracing opportunities for better economic relationship

Author: Rana Kapoor, MD & CEO, YES BANK & Chairman, YES Global Institute

Note: This article appeared in the www.khaleejtimes.com on June 27, 2018   

The bank aims to strengthen Indo-UAE Relations through human capital complementarities

India-UAE ties have traditionally been strong given the recent infrastructural investments, increasing arena of trade in goods and services, emerging energy reliance, fight against terrorism, and a thread of common culture with more than 3.5 million Indians working in the UAE.

With diversification of the UAE economy, the trade numbers between the two economies shot to $53 billion in 2016-2017. And with more focus on technology, space tech and tourism, the tie is all set to develop and evolve beyond trade to human capital. As famously said, ‘India now is not only a growing economic power, but also an aspirational power’, and the UAE is ready to embrace the opportunity.

With diversifying sectors, the requirement of skilled workforce has also increased in the UAE and India. With its huge 708 million workforce, India is a natural ally as a supplier, according to World Bank study (53.8 per cent of India’s population is the current workforce). India has already taken steps to align its ambitious skill development efforts and certification procedures with the requirements of the UAE’s job market.

The strategic partnership, focused on skill development and mutual recognition of qualifications, is a very important stepping stone given the shared history of workforce migration and India’s current challenge in providing jobs. The scope of the partnership in developing skills and the human capital complementarities will be the basis for the next bout of economic relationship.

Agreement on transnational standards: India and the UAE are poised to agree on the standard of skilled labourers or workers who are migrating to the UAE. This will be the very first step to set up a global benchmark in recognising the skill programmes being run by India. This will help India to negotiate with all countries on the quality of skills, qualifications and assessments.

Effective mechanism for skill-mapping: The two governments have already decided to integrate the e-labour platforms of the two countries, thus mutually and effectively developing a database and system of skill-mapping. The process helps to maintain the supply and demand chart between the two countries transparently.

Formation of a Joint Working Group (JWG): To ensure smoother operations between the countries, Ministry of Human Resource (MHRD) and Emiratisation (MoHRE) are expected to form joint working group that will overlook the assurance of quality and training pedagogy.

Harmonisation Plan: The UAE has also made multiple changes in their labour policy to ensure wage protection, amicable living conditions, workers’ health, along with provisions for disputes to be handled effectively. The e-Migrate system enables employers who want to recruit staff from India to register on a dedicated website, which in turn is approved by Indian embassies and consulates before an employment contract is finalised.

In conclusion, a harmonised human capital management between the two countries will help match the demand-supply challenge of the labour market in both of them. With India being the world’s fastest growing major economy and the UAE boasting of sovereign funds with a corpus of over a trillion dollars, manpower being placed at the scene of infrastructural projects makes better economic sense.

Not only Indian government, but global skill leaders such as Australia, UK and Germany have also recognised the potential of the UAE market. Dedicated skill centres, for example by QSec, are training labourers specifically to suit the UAE market. Thus, not only are they offering job assurance to the aspirants, but are also tapping into the global quality control requirement through these projects.

The human capital management and the positive steps towards aligning the tech goals of the UAE along with placement goals of the Indian government will slowly help open up the Indian education sector to UAE students. With the strongest and best networks of higher education institutions in engineering and management, India can enable major interactions between think-tanks and researchers through academic exchanges.

With artificial intelligence, blockchain and machine learning becoming the norm of future operations, it is just a matter of time before India starts sending in commercial techies. With a slow transformation of the UAE into a knowledge economy, India will be able to strengthen the bond that already exists between the two countries.