Prime Minister wants labour law reforms, focused investment

Says the country needs to attract more workers to the organized sector, which employs less than 10% of workforce

Faced with rising unemployment, Prime Minister Manmohan Singh on Tuesday called for labour law reforms and more investment in labour-intensive industries.
“We need to consider the possible role of some of our labour laws contributing to rigidities in the labour market, which hurt the growth of employment on a large scale,” he said at the 43rd Indian Labour Conference (ILC) in New Delhi. “Is it possible that our best intentions for labour are not actually met by laws that sound progressive on paper but end up hurting the very workers they are meant to protect?”
India has a 460 million-strong labour force. The government pegged unemployment at 9.4% earlier this month, a 1.2% rise from 2004-05, when the last comprehensive employment survey was carried out.
Singh said the country needs to attract more workers to the organized sector, which currently employs less than 10% of the workforce.
The ILC, the Prime Minister added, should also look at ways to improve the living standards of workers in micro- and small-scale sectors.
“Our regulatory framework in the labour sector should encourage investment in labour-intensive industries,” Singh said.
The cabinet will soon consider a new employment policy focused on promoting labour-intensive industries, Mint reported on 19 October.
The policy proposes to make it mandatory for state-owned companies to measure the benefits of proposed investments in terms of how many jobs they will create directly or indirectly.
“We are soon going to circulate a cabinet note on the new employment policy,” labour secretary Prabhat Chaturvedi said on the sideline of the ILC.
The two-day conference is focusing on three issues: the economic downturn and its impact on jobs; contract labour; and employment generation and skill development.
Labour and employment minister Mallikarjun Kharge said there is need for “bringing labour into the centre stage in economic and social policymaking”.
His ministry, he said, is working on schemes for developing demand-driven short-term training courses to impart skills that will help workers get jobs. It also plans to set up 1,500 Industrial Training Institutes and 5,000 Skill Development Centres with private participation.
E. Balaji, director and president of human resource and employment tracking firm Ma Foi Randstad, said labour laws are not in tune with reality.
“Contract labour law needs to change to help the industry face less trouble from the bureaucracy. In the age of globalization, the government needs to redefine what is (a) core and (a) non-core job to help mobility of workforce,” he said.
Balaji said the government should focus on labour-intensive manufacturing to create jobs.
Reacting to concerns raised by Bharatiya Mazdoor Sangh president Girish Awasthi on rising prices of essential commodities, the Prime Minister said the government is trying to reduce the inflation rate. “We have difficulties but we shall overcome (them),” he said.
India’s food inflation was 10.3% for the week ended 6 November.
source: http://www.livemint.com/2010/11/23222711/Prime-Minister-wants-labour-la.html?atype=tp