Montek pitches for labour law reforms
DAVOS: Making a case for more flexible labour laws to boost industrial growth, Planning Commission deputy chairman Montek Singh Ahluwalia on Wednesday suggested that Indian trade unions learn from China.
Ahluwalia reopened the debate on labour law reforms on the grounds that it could accelerate industrial growth by another 3-4%. "Manufacturing growth in India is much below what it should be. If we can't achieve 12% growth then we would not be able to create large employment," he said in response to a question on employment.
A few minutes after Ahluwalia's comments, Bharti Group chairman Sunil Mittal told a press conference that Indian industry had learnt to live with existing laws. In the absence of any reforms, industry has devised ways to deal with the problem as the current dispensation is seen to give them little flexibility in hiring and firing in line with seasonal demand.
At a session on India, Ahluwalia, however, also said that while China offered several experiences that India could draw upon, comparing the two neighbours should be avoided. He said India could not create infrastructure the way China went about doing it. Besides, he said, the political environment in the two countries was vastly different.
"India will not have manufacturing growth like China because of exports. Infrastructure isn't good enough. Labour laws don't allow for large scale employment in sectors that are labour intensive. The government is convinced that greater flexibility is required in labour laws but is concerned about big labour unions. Labour unions listen to us, what is required is better enforcement of labour rights, health standards. Indian trade unions need to learn from China on labour law flexibility," he said.
The session also focused on poor governance and social indicators. Ingrid Srinath Narasimhan, secretary general of Civicus, an NGO, pointed out that child malnutrition in India was still at around the same levels as in 1993.
Economis! t Raghu ram Rajan said GDP growth itself would result in limitations in due course. "Our biggest resource is people, how we empower them through health and education is crucial," he said.
Narasimhan also said that to a large extent, opportunities were still determined by identities and the deficit that needs to be addressed is democratic deficit. "Improved governance is not showing at the lowest level," she said adding that the space of the civil society was being severely constrained, as was seen in the case of the Binayak Sen episode.
There were also comments on the way compensation for land was being provided in India with Economist Raghuram Rajan saying that it did not amount to inclusiveness.
Ahluwalia reopened the debate on labour law reforms on the grounds that it could accelerate industrial growth by another 3-4%. "Manufacturing growth in India is much below what it should be. If we can't achieve 12% growth then we would not be able to create large employment," he said in response to a question on employment.
A few minutes after Ahluwalia's comments, Bharti Group chairman Sunil Mittal told a press conference that Indian industry had learnt to live with existing laws. In the absence of any reforms, industry has devised ways to deal with the problem as the current dispensation is seen to give them little flexibility in hiring and firing in line with seasonal demand.
At a session on India, Ahluwalia, however, also said that while China offered several experiences that India could draw upon, comparing the two neighbours should be avoided. He said India could not create infrastructure the way China went about doing it. Besides, he said, the political environment in the two countries was vastly different.
"India will not have manufacturing growth like China because of exports. Infrastructure isn't good enough. Labour laws don't allow for large scale employment in sectors that are labour intensive. The government is convinced that greater flexibility is required in labour laws but is concerned about big labour unions. Labour unions listen to us, what is required is better enforcement of labour rights, health standards. Indian trade unions need to learn from China on labour law flexibility," he said.
The session also focused on poor governance and social indicators. Ingrid Srinath Narasimhan, secretary general of Civicus, an NGO, pointed out that child malnutrition in India was still at around the same levels as in 1993.
Economis! t Raghu ram Rajan said GDP growth itself would result in limitations in due course. "Our biggest resource is people, how we empower them through health and education is crucial," he said.
Narasimhan also said that to a large extent, opportunities were still determined by identities and the deficit that needs to be addressed is democratic deficit. "Improved governance is not showing at the lowest level," she said adding that the space of the civil society was being severely constrained, as was seen in the case of the Binayak Sen episode.
There were also comments on the way compensation for land was being provided in India with Economist Raghuram Rajan saying that it did not amount to inclusiveness.
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