Labor reforms : Why They Are Needed?

The economic scenario is abuzz these days and the latest buzz word has been the labor reforms and rightly so. With the ideas such as Make in India and the latest speech by Modi in US adding steam to the developmental focus of the country and the economy, the labor reforms become more relevant than ever to make India a country with which doing business or setting up new ventures an easier task.

Doing Business with India

The 2008 world bank report stated that

“India’s labor regulations – among the most restrictive and complex in the world”

which makes it tougher for the other companies or countries or business to set up their venture in India considering that they will be subject to restrictions and it takes a long time for an approval to be made. Forget starting of the business, if the approval alone takes so much of time, so much of energy and patience is lost in negotiating and talking to a few people who don’t even understand the importance of a business makes it tougher.

What about the laborer himself?

Also there haven’t been much safe havens for a laborer in India, there is nothing much to protect him or her against discrimination. Sure, there are labor unions and gender group clubs which help you resolve the specific issue, what about the generic ones which laborers suffer on a daily basis? I agree that there are minimum wage laws and some other laws which cater to the issues but these laws belong to a different generation now, they are way older and belong to the bygone era. What about the challenges now, what is there to focus on issues of globalization? How prepared are we to address these challenges?

Well, this is where the labor reforms come into picture.

Following a couple of ideas from our PM Narendra Modi’s speech on labor reforms

1) Shrameva Jayate is equally important

We have all heard of satyameva jayate – truth alone triumphs. What about the hard work? What about the cogs of the wheel which make a machine run? Shouldn’t these people deserve the due respect and appreciation for the work they do, for the significant role they play in making the bigger picture work? We sure make way for the world leaders, for the ones who decide the policies and dictate them. But what about the ones who actually make them happen?

2) Inspector Raj will be a day of the past:

With the new reform ideas in progress, the inspector raj will be a power of the past. Earlier, the inspectors had an autonomy as to who to inspect, where to do and the time of it causing a bit of discomfort to the factories or the industries which were already set up. Think about this, if you have a labor inspector visiting you every now and then, when will you ever get to focus on the real deal of business? I am not saying that there should not be any inspection, there should be or else the companies will start bullying its workers and cutting corners on various issues like environmental aspects, maintaining base qualities, etc. But that doesn’t mean that the companies should be bullied for that. This asks for a transparent system for the labor inspections which the reforms are expected to achieve.

3) The problems of a laborer should be viewed in the eyes of a laborer

It is easy to make laws sitting on the top and leading from an assumption. But to understand the real issues and try and resolve them takes a whole different perspective altogether. There is no revolution or even a tiny change without empathy and if that is not the core of the solution in the labor reforms, then what is?

We are perfectly poised for the reforms and it sure will be a great way going ahead.

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