Can Modi 3.0 beat Germany? : Indian economic case study

Summary

This video explores how Germany rose from the ruins of WWII to become the world's third-largest economy, highlighting the role of its middle-sized businesses, high-quality production, and strong industry-academic partnerships. It contrasts Germany's success with India's current economic challenges, offering insights and lessons for India to improve its education system, empower MSMEs, and create a more evenly distributed industrial powerhouse.

Takeaways

• 😐 Germany's post-WWII economic recovery was remarkable, rising from the devastation to become the third largest economy in the world.
• 🏭 The success of Germany's Mittelstand companies, which are small and medium-sized enterprises, played a crucial role in the country's economic boom.
• 💼 These Mittelstand companies are known for their specialization, high-quality products, and B2B business models, which contribute significantly to Germany's export strength.
• 🏫 Germany's strong industry-academic connection and emphasis on practical education have been instrumental in producing skilled talent that drives these companies.
• 📈 The German government's policies, such as the Kurzarbeit program for unemployment insurance, have helped maintain economic stability and protect workers during recessions.
• 🌐 The distribution of these successful companies across Germany, not just in major cities, has led to balanced regional development and economic growth.
• 📊 In comparison, India faces challenges such as high unemployment, a lower education budget, and a focus on agricultural exports rather than high-quality industrial products.
• 📉 India's industrial output is concentrated in a few areas, unlike Germany's widespread industrial strength, indicating a need for more balanced regional development.
• 🏢 The Modi government is encouraged to learn from Germany's model, focusing on quality production, education investment, and strategic economic policies to support MSMEs.
• 🌟 The video script suggests that India can achieve economic superpower status by adopting the Mittelstand philosophy and implementing supportive government policies.

Q & A

What significant event marked the beginning of Hitler's Nazi party's rise to power?

Adolf Hitler and his Nazi party started to build a mass following after the significant event of the invasion of Poland in September 1939.

How did the World War II end for Germany?

World War II ended for Germany with the unconditional surrender of all German land, sea, and air forces in Europe to the Allied expeditionary forces on May 1st, 1945.

What was the state of Germany's economy and infrastructure after World War II?

After World War II, Germany faced rampant unemployment, major cities like Berlin and Frankfurt were bombed, over 20% of all housing was destroyed, and the German currency was in such a bad state that people were using cigarettes as currency instead.

How did India's economic situation compare to Germany's in the years following their respective wars of independence?

In 1947, when the British left India, the country was in chaos with 3 million people dead due to the Bengal famine, 2 million due to partition, and 80% of the population living in poverty. In contrast, Germany, despite the devastation of World War II, went on to become the third largest economy in the world.

What is the current status of India's and Germany's economies in terms of global ranking?

As of the information provided, India has become the fifth largest economy in the world, while Germany is the third largest economy.

What are the key differences in unemployment rates and per capita income between India and Germany?

The unemployment rate in India stands at 88.1%, whereas in Germany it is at 3.6%, which is one of the lowest in the world. The per capita income in India is $2,730, while in Germany it stands at $54,000.

What is the role of 'Mittelstand' companies in Germany's economic success?

The 'Mittelstand' companies, which are small and medium-sized enterprises, play a crucial role in Germany's economic success by being highly specialized, often becoming world market leaders in their niche industries, contributing significantly to exports and employment.

How does the German government support its 'Mittelstand' companies?

The German government supports its 'Mittelstand' companies by establishing strong industry-academic connections, ensuring a robust education system that provides practical skills, and implementing policies like the 'Kurzarbeit' program to maintain employment during economic downturns.

What is the 'Kurzarbeit' program and how does it benefit the German economy?

The 'Kurzarbeit' program is a German government policy that encourages companies to reduce employees' working hours instead of laying off workers during economic downturns. The government compensates for a significant portion of the lost wages, which helps maintain employment, consumer spending, and a ready workforce for when the economy recovers.

What lessons can India learn from Germany's economic model to improve its own economic growth?

India can learn from Germany's focus on high-quality production, the importance of a strong education system, the need for strategic economic policies to protect workers during recessions, and the development of a robust MSME sector. Additionally, India can look to Germany's even spread of industrial growth across the country as a model for empowering its tier 2 and tier 3 cities.

Outlines

00:00

🌍 Post-WWII Germany and India's Economic Trajectory

The paragraph discusses the aftermath of World War II, focusing on the economic and social devastation in Germany and drawing a comparison with India's situation post-independence. It highlights the drastic measures taken by the Allies, the unconditional surrender of Germany, and the subsequent economic boom that led Germany to become the third-largest economy in the world. In contrast, India, despite its progress, still faces significant challenges in terms of unemployment, per capita income, and exports. The paragraph emphasizes the need for India to learn from Germany's economic strategies and governance models to achieve similar success.

05:01

🏭 The Rise of Germany's Mittelstand Companies

This section delves into the role of Germany's small and medium-sized enterprises (Mittelstand) in the country's economic resurgence. It explains how these companies, often located in smaller towns, became world market leaders in their niches, contributing significantly to Germany's export prowess. The paragraph also touches on the historical context, including the British Merchandise Marks Act and its unintended boost to the 'Made in Germany' brand. The narrative underscores the importance of specialization and quality in German industry, which has been a hallmark of their success.

10:02

🎓 The Impact of Education and Industry Partnerships

The paragraph examines the German education system's role in fostering a skilled workforce and the strong ties between academia and industry. It contrasts the German approach, where students engage in practical, industry-relevant projects, with the Indian system, which is criticized for its theoretical focus and outdated curriculum. The summary points out the importance of aligning education with real-world challenges and the benefits of partnerships between universities and businesses in producing employable graduates who can contribute to the economy.

15:02

🛠️ The Power of Hyper-Specialization and B2B Business Models

This section discusses the business philosophies that have contributed to the success of Germany's Mittelstand companies, particularly their hyper-specialization and focus on B2B markets. It explains how these companies achieve high quality and specialization in their products, leading to a strong position in the global market. The paragraph also highlights the advantages of B2B business models, such as long-term customer relationships, high customer lifetime value, and the ability to charge premiums for reliable products and services.

20:02

💼 The Kurzarbeit Program: Germany's Unemployment Insurance Plan

The paragraph introduces the Kurzarbeit program, a German government policy designed to maintain employment and economic stability during economic downturns. It explains how the program allows companies to reduce working hours instead of laying off employees, with the government compensating for lost wages. The summary outlines the benefits of this approach, including job preservation, sustained consumer spending, and a quick return to full production when economic conditions improve. The paragraph also compares Germany's low unemployment rate with other countries and discusses the financial structure of the Kurzarbeit program, which is funded by contributions from employees and companies.

25:03

🚀 Learning from Germany: Strategies for India's Economic Growth

The final paragraph summarizes the key lessons India can learn from Germany's economic model, emphasizing the importance of high-quality production, empowering the MSME sector, investing in education, expanding beyond agricultural exports, and developing a robust welfare system. It calls for strategic economic policies that protect workers and promote economic stability, suggesting that India should adopt sustainable economic models similar to Germany's Kurzarbeit program to ensure continued growth and resilience in the face of recessions.

Keywords

💡World War II

World War II, also known as the Second World War, was a global war that lasted from 1939 to 1945. It involved the vast majority of the world's nations, including all of the great powers, organized into two opposing military alliances: the Allies and the Axis. The video script refers to the aftermath of the war, highlighting the devastation in Germany and the subsequent economic recovery, which is a central theme of the video.

💡Nazi Regime

The Nazi regime refers to the period of Germany's history when the country was under the dictatorship of Adolf Hitler and the National Socialist German Workers' Party (NSDAP) from 1933 to 1945. The video mentions the end of this regime with the surrender of Germany in May 1945, marking the end of World War II in Europe and the beginning of Germany's reconstruction.

💡Unconditional Surrender

Unconditional surrender is a term used in the context of the surrender of a belligerent power in a war or conflict without any conditions. In the video, it is mentioned that Germany signed an act of unconditional surrender, symbolizing the complete defeat and the start of the country's rebuilding process.

💡Deindustrialization

Deindustrialization refers to the process of decline in industries and the loss of a significant share of the workforce in manufacturing sectors. The video script describes how major German cities like Berlin and Frankfurt were heavily bombed, leading to rampant unemployment and the destruction of housing, which is an example of deindustrialization.

💡Economic Recovery

Economic recovery refers to the period during which an economy returns to a state of growth after a decline, often following a recession or a war. The video discusses Germany's economic recovery post-World War II, emphasizing the country's transformation into the third-largest economy in the world.

💡Middle Stand (Mittelstand)

Mittelstand refers to small and medium-sized enterprises (SMEs) in Germany that are often family-owned and play a significant role in the country's economy. The video highlights the importance of these companies in Germany's post-war economic boom, as they are often highly specialized and contribute significantly to exports.

💡Hyperspecialization

Hyperspecialization is a business strategy where a company focuses on producing a very specific type of product or service to a high degree of quality and expertise. The video explains how German Mittelstand companies often become world leaders in their niche markets through hyperspecialization.

💡B2B (Business-to-Business)

B2B refers to a business model where a company sells its products or services to other businesses rather than directly to consumers. The video script discusses how many successful German Mittelstand companies operate as B2B businesses, focusing on value and long-term customer relationships.

💡Industry-Academia Connection

The industry-academia connection refers to the collaboration between industries and academic institutions, often involving research, curriculum development, and student training. The video emphasizes the strong industry-academia connection in Germany as a key factor in producing skilled workers and fostering innovation.

💡Kurzarbeit

Kurzarbeit is a German government policy that provides financial support to workers who have had their hours reduced during economic downturns, preventing layoffs. The video describes how this policy helps maintain a stable workforce and contributes to Germany's economic resilience.

💡Economic Superpower

An economic superpower is a country with a dominant and highly influential economy on a global scale. The video discusses India's aspiration to become an economic superpower and draws lessons from Germany's economic model, suggesting areas for improvement such as education, industrial distribution, and economic policies.

Highlights

Adolf Hitler and the Nazi party gained a mass following, leading to the invasion of Poland and the outbreak of World War II.

By 1945, after a series of victories and defeats, the Axis forces were out of sync, and the wars in Europe and Asia merged into a single global conflict.

Hitler's defeat in World War II and the subsequent division and occupation of Germany by the Allies marked the end of the Nazi regime.

Post-war Germany faced immense challenges including unemployment, city bombings, housing destruction, and currency instability.

India, post-independence in 1947, also faced significant challenges including famine, poverty, and economic exploitation.

Despite the devastation, both Germany and India managed to rise and become leading economies within a few decades.

India's current Prime Minister, Narendra Modi, has set a goal for India to surpass Germany as the world's third-largest economy.

India lags behind Germany in key economic indicators such as unemployment rate, per capita income, and exports.

The German economy's success is attributed to its small and medium-sized enterprises (SMEs) that are often world market leaders.

German SMEs are known for their specialization, high-quality production, and focus on B2B markets.

The German government has fostered a strong industry-academic connection, ensuring that education aligns with real-world challenges.

Germany's Kurzarbeit program provides a safety net for workers and businesses during economic downturns, unlike traditional unemployment benefits.

India can learn from Germany's focus on high-quality production, education investment, and strategic economic policies.

The Modi government is encouraged to increase India's education budget and improve the quality of education to boost the economy.

Germany's economic model demonstrates the importance of a robust SME sector, a strong education system, and strategic government policies.

India needs to empower its tier 2 and tier 3 cities to create a more evenly spread industrial powerhouse.

The video concludes with a call to action for the Modi government to learn from Germany's economic strategies and implement sustainable policies.

Transcripts

[Music]

Adolf Hitler and his Nazi party start to

build a mass

following September 1939 Nazi Germany

invaded

[Music]

Poland after one Victory had followed

another the axis forces are out of Step

the wars in Europe and Asia now merge

into a single gigantic World War the

largest war in history hi everybody the

year is 1945 Hitler had just lost World

War I and the Soviets Americans and the

Brits had taken over Germany May 1st

1945 the Allies have won the war is over

after 12 years in power and 6 years of

war the Nazi regime has come to an end

the designated head of the German State

signed the act of unconditional

surrender of all German land sea and air

forces in Europe to the Allied

expeditionary forces the world war had

killed 6 million German citizens Germany

was hit by rampant unemployment major

cities like Berlin and Frankfurt had

been bombed and more than 20% of all

housing in Germany had been destroyed

and the German currency was in such a

bad state that people were using

cigarettes as currency instead of using

the German currency Germany 4 years

after the end of the second World War

this was a life like you can't imagine

balanced between Devastation and New

Beginnings we looked across the Old Town

it was one big pile of rubble and just

like Germany in 1947 when the Brits left

India even India was in Shadows 3

million people had died due to the

Bengal femine 2 million died due to

partition and 80% of our population was

living in poverty as the British left in

1947 chaos erupted the India that prime

minister jawaharlal nehu inherited was

that of an economy battered by Colonial

exploitation in India nearly everyone is

hungry and each year famine claims 7

million India was a struggling agrarian

economy and poverty was widespread but

in the next 70 years while Germany went

on to become the third largest economy

in the world India went on to become the

fifth largest economy in the world and

now Modi G has promised Indians that we

will beat Germany to become the third

largest economy in the world but you

know what guys I hate to break it to you

that we are far far away from Germany

while the unemployment rate in India

stands at 88.1% Germany stands at 3.6%

which is one of the lowest in the world

while our per capita income is

$2,730 the German per capita income

stands at

$54,000 and most importantly in spite of

having 16 times less population than

India while Indian exports stood at 46

billion in 2022 the German exports stood

at $1.6 trillion in 2022 so if you see

even though it looks like our economy is

growing at a staggering rate except for

GDP we are far far behind in terms of

exports employment and even per capita

income and since India is now on its

part to become the third largest economy

as citizens of India our Benchmark to

judge the BJP should not be the Congress

or Pakistan our Benchmark must be

derived from legendary countries like

Germany Finland and Singapore and more

importantly it is our Prime

responsibility to hold the Modi 3.0

government accountable by using these

benchmarks so in this episode today

let's dive deep and try to understand

after the destruction that Germany faced

with Hitler and World War II how did

Germany become the third largest economy

in the world what are the most powerful

and revolutionary models of governance

that turned Germany into one of the

richest nations of the world and most

importantly as citizens of India what

are the lessons that we need to learn

from Germany to hold the Modi government

accountable people did you know that

while the German economy is booming its

population is only getting older this is

the reason why there are a lot of

opportunities for the Youth to build a

successful career in Germany because

Germany needs Talent at this moment and

they are creating a lot of opportunities

for the young a societal system with

jobs and even housing and here's where

leverage edu is here to help you out

leverage edu is India's leading study

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German government agencies and its

universities for many years and along

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next one so if you intend to pursue your

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description this is a story that dates

back to 1945 during this time Hitler had

just lost World War II and he committed

suicide on 30th of April 1945 eventually

the Nazi surrendered to the Russians

Americans and British forces on 7th of

May 1945 the war is over ADF Hitler

commits suicide 6 years of suffering

sacrifice and

death the sights and sounds of Victory

in Europe Echo across the Atlantic and

around the world the general puts his

signature to the document which

acknowledges the complete defeat of the

German Armed Forces by those of Britain

Russia and the United States that the

forces of Germany have surrendered to

the United Nations in the wake of this

war many important German cities were

left in Ruins Berlin which is the

capital of Germany was heavily bombed by

the Soviets the poor city of Hamburg was

destroyed by bombing and even the

industrial area of statguard was

destroyed in the war the Red Army

smashes its way to the Heart of the City

in 18 days 93 German divisions have been

destroyed

125,000 German civilians have perished

in the rubble of the city 6,000 have

committed

suicide Berlin has been virtually

annihilated so in the Indian context it

is almost like saying Mumbai Surat Delhi

and Chennai were bombed so do you

realize if he lose these cities to

bombing it would push India 30 years

behind because these cities stand as the

pillars of our economy so the question

is when the most important cities of

Germany were destroyed to such an extent

how did Germany rise to become an

industrial Powerhouse and an export

Legend well as it turns out the majority

of the German trade and Export were not

coming from cities like Berlin or Munich

it was coming from the small and

mediumsized businesses which were spread

all across Germany as in even in the

tier 2 tier 3 cities of Germany these

companies are a special category of

companies called middle standand

companies and here's where ladies and

gentlemen I wanted to show you something

absolutely mind-blowing if you visualize

the industrial hubs of India on the map

of India this is what it looks like if

if you see the industrial output of

India is coming from a few pockets of

the country while the rest of the

country is far far away from growth or

is engaged in agriculture but if you

look at the map of Germany this is what

it looks like do you see these red dots

every Red Dot represents a World Market

leading company and the bigger red dots

represent a cluster of 45 Market leading

companies now mind you these are not

Market leaders in Germany these are

Market leaders in the entire World

economy so they are World Market leaders

each of these companies export products

all across the world and they are Market

leaders in the world for example there's

a company called Maya whift which is a

World Market leader in building cruise

ships which generates a revenue of $898

million and has a market share of almost

50% then there's a company called

Ableton that makes electronic music

mixing software and hardware for DJs and

again it is a market leader with a

market share of 54.2 7% in the entire

world and Tetra is a market leader in a

niche market of ornamental fish food now

you tell me guys can you think about

Indian companies that are World Market

leaders it's quite difficult to think

right but you know what guys Germany

doesn't have one or two World Market

leaders just as of 2014 Germany had

1,400 World Market leaders which were

midle Stan companies and all these

companies come together to contribute to

the export superpower of of Germany so

the question is while on one side Indian

companies are struggling to compete in

India against the Chinese products then

how is it that these German companies

are becoming Market leaders in the

entire world economy well this is

because ladies and gentlemen the mle

Stan model operates with four common

business philosophies and each of these

business philosophies are very practical

and can be applied by every entrepreneur

very very easily so let's understand

them better firstly middle Stan

companies are hypers specialized

companies that produce just one type of

products for a very long time and then

they diversify but they produce these

products in such high quality that they

go on to become unbeatable in the world

market and this is something that has

been a part of the German DNA for

centuries and you know there's actually

a funny story that before World War I

the britishers passed an act called the

merchandise marks act and this Act made

it compulsory for German products to be

labeled as made in Germany because the

Brit thought that people would see these

inferior quality German products and the

German trade would suffer eventually the

britishers will be able to trade better

and they would be able to make more

money but guess what these German

products were of such high quality that

made in Germany became a trademark and

soon enough German companies started

charging a premium of 20% because of

this reputation this is the power of hyp

specialization and highgrade production

in case of Middle Stan companies you

will see hypers specialized companies

like manques that only make charging

apparatus for electric vehicles then

there's a company called electri Sola

that makes just wires but they make such

high quality wires that they used in

Mars rower secondly 85% of these middle

Stan Champions are B2B businesses why

because B2B businesses by Nature have

three very critical attributes firstly

in the B2B business customer acquisition

is based on value whereas in b2c it

could be based on marketing gimmicks for

example if you're selling a fridge to a

consumer you can use gimmicks like voice

control give it a fancy do and get Shah

ruk Khan as your Ambassador and the

fridge will start selling like hot kaks

but when you're selling a refrigerator

to a business like a restaurant your

product has to be topnotch you need to

provide powerful cooling you need to

provide huge space you need to make sure

that the refrigerator is energy

efficient and most importantly it has to

function without any glitches because if

the refrigerator doesn't work and spoils

the inventory on a Friday evening it

would be a nightmare for the restaurant

T know so in the B2B market value trumps

gimmicks and here's way ladies and

gentlemen the the middle Stan companies

utilized their quality proposition if

you look at companies like Liber they

specialized in fridges and freezers for

the longest time and they provide high

grade specialized pharmacy fridges

medical fridges and even commercial

fridges and just by selling fridges they

made €1.1 billion e this is the power of

hyp specialized B2B business secondly in

the B2B space the benefit of a discount

comes at a very heavy cost and this

again helps you come out a premium and

here's an example to help you understand

the same let's say you run a sneaker

company and you have two payment Gateway

options one is a reliable branded

software that costs you 2% of your order

value and the other is a less Reliable

Software that cost you 1.5% of your

Revenue now let's say you choose the one

with 1.5% fee so that you can save up on

this 0.5% cost now imagine this guys

after you ran ads for 10 lak rupes on

Instagram 1,000 customers paid for your

product the customers money got deducted

from their account but your payment

Gateway never registered the sale in the

first place which means your inventory

does not get shipped to your customers

at all even after the money got deducted

from the customers's account now do you

realize as a business owner what kind of

a nightmare this would be after spending

LHS of rupees instead of having 1,000

happy customers you will now have 1,000

haters who would consider your company

to be a scam so do you realize this 0.5%

discount comes at a very very heavy cost

when it comes to B2B products so in the

B2B space if you build a super reliable

easy to use and efficient product even

if you charge a 20% premium customers

will happily buy your products because

the risk of a 20% discount for the

client is much higher in the future in

this case even if the payment Gateway

costs you 3% of your Revenue you would

still opt in for it because of the

nightmare that you experienced and a

classic example of a high stake B2B

business is sap which stands for systems

applications and products and this

company since since 1972 has been

focused on helping businesses manage

their systems better that's it and just

a few years into business until today

they have been such a critical backbone

for billion dollar companies that today

most of their clients can't imagine

their life without sap and guess what by

capitalizing on this Niche B2B market

today sap generates a revenue of 31

billion EUR and thirdly in the busines

to business space because you provide

such high value your customers will with

you for a very long time unless you mess

up really badly so the customer lifetime

value is very very high these are the

superpowers that a businessto business

client brings to the table and all of

these things put together it gives the

German msmes three incredible

superpowers number one since their

customers stick with them for a very

long time they have a very consistent

cash flow which eventually gives them

constant profits number two these

profits are then invested heavily into

research and development which further

helps them build great products which

are better than the competition and

lastly when you have consistent cash

flows you can retain and build a

formidable team even during a recession

this is a reason why as time passes

German Middle St companies become more

and more powerful with their products

and cherry on the cake 71% of the middle

Stan Champions are located in small

towns of Germany which have a population

of less than 1 lakh people so you know

what happens instead of millions of

people trying to cram into the economy

of a city like Mumbai the entire

population of Germany finds opportunity

not just in Berlin or Frankfurt but even

in the small towns in Germany and this

is where ladies and chman the M Stan

companies achieve a virtuous cycle

number one because of great products B2B

clients sck with them for decades this

give them consistent cash flow and

profits these profits help them retain

talent and invest in R&D and eventually

consistent research and development

helps them build the best products and

services in the world which again gives

them very heavy profits now now after

listening to all of this a lot of you

will tell me bro all this is very easy

to say but the question is how did the

German government help these mital St

companies become so successful and why

are Indian companies failing well the

first and perhaps the most important

thing that the Germans did very well is

establish a very strong industry

academic connection so let me help you

understand the difference between Indian

engineering and German engineering

education and you will understand what

this means people in Pune University

engineering students have to submit

something called the B project in their

fourth year so after studying 40

subjects over 4 years you have to pick

one subject that you intend to

specialize in and ideally you are

supposed to apply your knowledge to

solve a real world problem for example

in India there is a dying need for an

efficient waste management system so

ideally a group of four civil

engineering students are supposed to

collaborate and spend their entire

fourth year under the guidance of a

professor who would guide them into

research and solving a real world

problem so they are supposed to visit

different Waste Management plans talk to

businesses research and find gaps in the

Market design different solutions and

apply those Solutions eventually to fail

and succeed in designing a better waste

management system for India and

eventually after going through this

iterative process by the end of the year

they are supposed to present a thesis of

around 100 Pages which consists of a

detailed analysis experiment results and

proposal of a new solution to the waste

management problem so this way Indian

Engineers are supposed to apply their

knowledge to become better problem

solvers but you know what happens in

most of our engineering Coles firstly

the professors are incompetent because

they themselves have never solved a real

world problem secondly our students are

loaded with so many stupid assignments

and an outdated syllabus that they spend

all their time copy pasting useless

information from one file to the other

and thirdly because of a stupid rule of

compulsory 75% attendance in lectures

the student does not find any time to go

for site visits at all so you know what

the students from our batch did they

simply copy pasted their research

materials from random research papers

from the internet and and compile them

together eventually they submitted that

to the university now since the

professor herself is incompetent lazy

and ignorant they simply drop a

signature and pass the candidate and by

the way if the professor holds a grudge

against the student then the professor

will over scrutinize a project and

torture the student until the professor

is satisfied and if you don't want to go

through this hassle you know what you

can do you can simply buy an engineering

project for 10,000 rupees in Pune in

fact there's a shop in Pune which will

give you a catalog of be projects which

which you can buy and submit to the

university so you don't have to solve

anything or take the hassle of

researching and developing engineering

Solutions at all this is the reason why

even after four years of education the

engineering students of India remain a

book with no practical skills at all in

fact according to the skill India report

of 2024 more than 35% of our btech

students were unemployable almost 30% of

the MBA students were unemployable 60%

of the it students were unemployable and

more than 75% of our poly Technic

students were unemployable now now mind

you these are not unemployed students

these are unemployable students which

means even if these students are offered

a job they cannot take it because they

don't have the skills for that

particular job but you know what happens

in Germany German universities have

established robust Partnerships with

Industries all across the country and

these Partnerships are not just about

providing internships or job placements

they are about a deep integration of

academic learning with real world

challenges for example the Technical

University of Munich has part partner

with companies like BMW semens and

Airbus and these companies actively

participate in shaping the curriculum

offering guest lectures sponsoring

research projects and providing

state-of-the-art equipments and

Facilities to the students so while

Indian engineering students waste their

time copy basting assignments and

studying an outdated syllabus a German

student is acquiring those skills that

are specially needed in companies like

BMW semens and Airbus similarly BMW

might even present a challenge to the

t's engineering students for example BM

BMW might challenge the students to

develop a new lightweight material for

manufacturing electric vehicle batteries

and then the students work under the

mentorship of both T professors and BMW

engineers and they get to experiment

prototype and test their solutions by

applying their knowledge eventually

while an Indian engineering student is

copy pasting random information from

research papers a German student is

building a strong thesis on how to build

lightweight material for Ev batteries

and after the project is done while an

Indian engineer struggles to find a job

a German engineering student gets a job

in BMW itself and while Indian companies

struggle to hire good engineering Talent

M Stan companies get access to great

talent because of such collaborations as

a result while Indian companies produce

media core products German companies end

up building world class products

eventually leading to better exports and

hence better income for both the German

people and the German economy this is

the power of German education system and

here's why ladies and genten I have an

important message for the Modi

government if you look at how much India

and Germany spend on education it will

blow your mind in spite of being a $4

trillion economy Germany spent 4.6% of

its GDP on education in 2023 whereas in

fi23 India spent only 2.9% in education

so do you realize what this means India

has a population of 140 CR people and

Germany has a population of 8.38 CR

people if you do the math while India is

spending

$81.60 per person Germany is spending

$2,957 per person on education which is

26 times as that of India so you tell me

guys in this fast-paced

technology-driven world if we have such

an incompetent engineering education

system and we spend so little on

education how are we going to beat China

or Germany and it is so sad to know that

if this continues for the next 10 years

we have to say goodbye to becoming a an

economic superpower this is a second

reason why Germany has become an

economic superpower while we are still

dependent on China and this is something

that the Modi government desperately

needs to work on which is increasing our

education budget and increasing the

quality of our education if this is very

very clear to you let's come to the last

and perhaps one of the most amazing

government policies in Germany which is

their unemployment insurance plan and

this is all the more important for India

because under the Modi government

unemployment in India has reached

dangerous levels but if you look at

Germany it has a strange superpower if

you look at this graph you will see that

in 2020 this is what the unemployment in

the US looked like as soon as the

pandemic hit the unemployment

skyrocketed but if you look at Germany

Germany only experienced a minor bump in

unemployment fascinating isn't it but

again after the Russia Ukraine war

started in 2022 it had such a drastic

effect on the German economy that in

2023 the real GDP of Germany declined by

0.2% gerous economic advisor slash their

growth forecast for the country

Germany's leading economic institutes

have revised the country's growth this

year down to basically near of

stagnation Germany is taking an economic

hit due to vastly increased energy bills

caused by Russia's invasion of Ukraine

but again in 2023 while Italy saw their

unemployment rate touch 7.5% France

stood at 7.4% Spain hit 11.9% whereas

Germany's unemployment rate was at a

record low of just 3% so the question is

even during the worst recession of the

decade how is the German market so

resilient well this is because of a

German government policy called The

kurza Bite in this program instead of

resulting to layoffs during economic

downturns companies are encouraged to

reduce employees working hours and to

support workers during this reduced work

time the government steps in to provide

a significant portion of their lost

wages and this action gives the German

economy an insane advantage over

American economy so let's understand

this using an example let's say there is

a large automobile manufacturing plant

in Wolfsburg which employs 2,000 workers

but due to a global recession the demand

for new cars has plummeted by 50% which

has forced the plant to reduce

production Now While most American

companies would simply lay off 20 to 30%

of their Workforce this German plant

decides to implement kurab bite program

so the government approves their

application and allows them to reduce

their working hour for all employees by

50% so now instead of working for 48

hours a week the employees will work

only for 24 hours a week and for these

24 hours that they work the workers

would receive their full salary but for

the next 24 hours of wage which they

lost the government would compensate

them for about 60% of their lost wages

so for the next 6 months the company

only has to pay 50% of the salary to the

employees while the government pays the

employees 60% of their lost wages so if

somebody makes €3,000 the employer would

pay $1,500 and the government would pay

them € 720 so in total they would make2

, 220 as compared to €3,000 and this

Arrangement ladies and gentlemen brings

three superpowers to this MSM ecosystem

firstly the jobs of the workers are safe

so the family doesn't have to live in

stress secondly since the workers are

still getting a major chunk of their

salary they would keep spending that

money into buying groceries personal

care products and household items so

again the revenue flows to these fmcg

companies which again helps them retain

their employees and last and most

importantly since the plant maintains

its entire skilled Workforce after 6

months when the demand for cars shoots

up while the American companies struggle

with hiring training and deployment of

new Workforce the German companies ramp

up their production without any delay

because they never let any skilled

worker go so the German factories are

always up for production the German

employees are always safe and the German

economy is always booming this is how

the kuraby program prevents a shock to

the economy and the job market even

during the times of recession now you

might tell me bro what are you saying

this is like giving free now so just

like Congress promised to give 1 lakh

rupees a year here the German government

is paying the salaries of millions of

people so are you saying that the

government must pay the salaries of

these people using the tax Bas money

well guess what this money in Germany is

not coming from the tax Bay of Germany

it's coming from the employees and the

companies itself long story short if you

make €3,000 a month you would contribute

1.2% of your salary and your employer

would contribute another 1.2% per month

to the kuraby fund and just like

insurance when you lose your job you

will get paid 60% of your lost pay by

the government so it's not a freebie

it's an economic Master stroke which

keeps the economy running even during

the times of recession this is how

ladies and Gentlemen by building a

robust ecosystem with great education

great welfare system and a great culture

of producing the highest quality

products in the world Germany has built

one of the most powerful msme ecosystems

in the world and more importantly since

these Middle St companies spread all

across Germany the growth of Germany has

been very even and not concentrated to a

few pockets in the country and this

brings us to the last part of the

episode and that are the lessons that

India needs to learn from the rise of

Germany using the middle Stan philosophy

lesson number one the first thing that

India needs to focus on is building high

quality products and not cheap quality

products because if we want to become an

export superpower we have to move Beyond

agricultural products and build high

quality electronics and machines lesson

number two to produce such high quality

products we need to empower our our msme

sector and if you look at Indian msmes

just like German msmes our msme employs

100 million people and contributes close

to 30% of our GDP and 50% of our exports

but while German companies are building

world-class products Indian companies

are struggling with Talent technology

and financing so we need to desperately

work on these aspects to empower our

exports lesson number three the Modi

government needs to work diligently to

fix our education system and the least

we can do is increase our budget

allocation from 2.9% of our GDP to 6% of

our GDP which is our education

commission's recommended level and

unless we fix our education system even

if we bring in billions of dollars in

FDI our students will not be able to

apply for those jobs even if those jobs

are available lesson number four while

we grow our economy unlike the Germans

who have industrial powerhouses all

across Germany our industrial capacity

is concentrated in these small pockets

of India so just like Germany we need to

empower our tier 2 tier three citizens

in such a way that we build an evenly

spread out industrial Powerhouse for

India and lastly just like Germany has

an unemployment insurance scheme India

needs to have a strategic economic

policy that can help the workers prevent

this risk of recession and unlike a

congress proposed freebie policy it has

to be a sustainable economic model

because always remember there is a thin

line between a freebie and a sustainable

economic model one will drain your

economy and the other will boost your

economy so high quality production

increasing the education budget

improving the education system expanding

Beyond agricultural exports better

financing for msmes and the development

of the tier 2 tier 3 cities of India

these are my humble suggestions to the

Modi government that we can learn from

the German economy that's all from my

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you so much for watching I will see you

in the next one bye-bye no no

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