Why would the government invest in creating skilled labor, and then send them to work overseas?

Question

Brain drain is a big problem for India. For example, a NITI Aayog (a government think tank) member recently said that the country is looking for a reverse brain-drain to develop at a faster pace.

However, in 2020, India launched India International Skill Centres (IISCs).

Some of the information stated on their website is:

Government of India is keen to bridge the global shortage of labour force in the coming years by reaping the demographic dividend of young Indian labour force.

180 candidates [from IISC] placed (offline data)- 63 in overseas locations (35% of total placement), 117 in domestic locations (65% of total placement)

Prima facie, this looks like the government is aiding brain drain - that is, a bad policy decision. But the program continues, so there must be some benefit.

Why would the government of India invest in creating skilled labor, and then send them to work overseas? How is this advantageous for India? Has the government explained what they hope to gain from this?

Answer 1

• India is among the leading recipients of remittances, that is money sent home from workers abroad.
• A diaspora of highly-skilled, well-integrated emigrants might give India a good reputation in some of the destination countries, depending on local politics.

Answer 2

This depends on the culture. If it is usual to visit home country often, support parents and siblings, use there cheaper services and spend vacations, "exported work force" may bring huge money into the country, becoming comparable to any other industry.

For instance, in a small country like Lithuania, in 2021 transfers into the country from private persons living abroad amounted to 658,2 million EUR that is 1,3 percent of GDP. In comparison, 1.1 billion were designated for defence and 894 million EUR for health care.

Answer 3

This "brain-drain" is actually making India savvier at tech.
Each tech-savvy Indian who goes abroad creates multiple jobs for tech-savvy Indians in India, and helps India become savvier at tech. The process has the subtler benefits of foreign-direct investment even though it is usually done by Indian-controlled firms. Here is how it works:

India has several very successful companies that provide computer programming services for foreign companies. The most successful of them have this kind of staffing model:

• A core of Indian-born and -educated workers working abroad. These workers include a few outside sales professionals, hiring managers, and a fair number of business analysts and computer programmers of varying skill levels. These workers work closely with their clients. Some are onsite; the rest are more-or-less in the clients' timezone.
• A smaller number of workers recruited from the labor market where the client is located. These workers also work closely with the clients, either onsite or more-or-less in the clients' timezone.
• A large number of Indian-born and -educated workers working in India. These workers include inside sales professionals, hiring managers (for positions in India), business analysts and computer programmers. These employees may be 2 to 5 times as numerous as the similar staff co-located with the client.
• India-based executives and support functions (IT, Legal, Finance, and most of HR).

Many of the Indian employees co-located with the client started with their employer in India. After "learning the ropes" and proving their abilities in India, they received promotions to the co-located teams. Some of these employees eventually hire on with the foreign clients. (Which opens up further marketing opportunities for the Indian consulting company.)

In terms of corporate culture, this model allows the foreign clients' concerns about timeliness and quality to be transmitted from the client and the local hires. Along the way, these concerns are embraced and amplified by successful Indian workers in the co-located teams and aspiring Indian workers in the India-located teams. This model also has a critical mass of Indian workers in each location to allow Indians to communicate in Indian languages (such as Hindi) and maintain Indian values (such as family loyalty).

There is also the potential that some of these employees who have been exposed to foreign "start-up culture" may "start up" "spin-off" companies in India, serving Indian markets.

Answer 4

But the program continues, so there must be some benefit.

Benefit to whom? A particular government department does not necessarily represent the good of the whole nation. It may, for example, represent the interests of (and be under the influence of) global capital, rather than Indian national development.

Why would the government of India invest in creating skilled labor, and then send them to work overseas? How is this advantageous for India?

I have the strong impression that there is a strain of thought in India that the primary difference between themselves and the West is the level of cultural development. Perhaps, this is the legacy of the British Raj, and the infrastructure and political ideas it left behind.

Those who go temporarily abroad, or who settle abroad permanently but maintain links with an extended family in India, are potentially in a position to absorb (the assumed...) Western cultural advantages and drain these back towards India.

On this hypothesis, what they lose in access to the skilled labour they have produced, they eventually gain (through emigrant returns, or through international family connections) in greater access to the broader Western ideas and patterns of civil and social life (like a reasonably non-corrupt civil service and public administration) which they sorely wish to emulate.

Answer 5

To fully answer this question, we need to summarize various points mentioned in the comments and answers and add some information.

First, as @JamesK comments, that is a pretty small program, 180 people from a country of over a billion! It is certainly too small to affect the "brain drain" significantly.
As @DavidHammen mentions, India's brain drain problem is in the tens of millions and is almost entirely subsidized by family members. While there are plans to ramp up the IISC program significantly, the numbers will definitely be nowhere near millions.

Next, as @ItalianPhilosophers4Monica mentions: diasporas from many countries eventually return home and bring back foreign-acquired skills. While they're still working abroad, they boost local industry by sending remittances (which have numerous benefits), tourism, and amplifying the social capital of their family.

The government also conducts PDOT, a training program for emigrants, and some of the training modules include information on government support for emigrants and the Dos and Don'ts of the country of employment.
Such a program means that the government wants to improve the standard of living as well as conduct of emigrants and ensure they're not exploited (there is a long history of exploitation of Indian workers by overseas agents, especially in the gulf) - so that the country's positive image improves in destination countries. IISCs are one step further in this direction.