States mulling incentives to woo investors
nNEW DELHI: Under the Centre’s prodding, governments of Bihar, Madhya Pradesh and Himachal Pradesh are considering offering incentives including exemptions from labour laws to investors ready to start new projects in their states to rebuild local economies. According to a senior government functionary aware of the details, the Union government has asked states to revisit existing policies for industry.
“There is a proposal to give a labour law holiday for the first 1,000 days to investors who start new ventures in Madhya Pradesh. A lot of relaxation has been given in the agricultural sector; where there is complete liberalization of farm produce sale,” said the functionary, who didn’t want to be named. A labour law holiday refers to relaxation from specific labour laws.
Relaxation of labour laws and easier land acquisition were proposed in a paper presented by the BJP to the Centre following a meeting with industry leaders.
HT earlier reported that the party suggested a new manufacturing policy to help the country revive the Covid-19-battered economy as well as cut its dependence on imports, particularly from China. The cost of acquiring land and the legal and procedural delays and the need for reforms in the labour sector were flagged in the report presented to the government on April 10.
In Bihar, an official aware of the details said the process of identifying incentives that could be offered to industry and manufacturers has been set in motion. “We were the first ones to refuse (to adopt) the Agricultural Produce Market Committee (APMC) model, that farmers complained did not ensure a fair system of buying and selling commodities. Now the centre is seeking suggestions for allowing changes in labour laws,” this person added.
Similarly, Uttar Pradesh has set up a committee to come up with a plan for suggesting incentives that can be offered to investors. “After the last investor summit we had already come up with plans to offer capital subsidy, land subsidy and a host of other incentives. Once the committee gives its report we will be able to take a call on what more needs to be done,” a senior UP official said, asking not to be identified.
In Gujarat, the government has decided to restart industrial units and businesses falling outside the limits of municipalities and municipal corporations and containment zones. “We also provided the freedom to labourers to work for a 12-hour shift with additional pay for extra hours,” said Gujarat CM Vijay Rupani.
An official in the labour ministry said the ministry is considering suggestions such as the proposal for a labour law holiday.
CK Saji Narayanan, president of the Bharatiya Mazdoor Sangh, the labour wing of the BJP, said no labour law reforms should be allowed. “Labour reforms at this point will divide the society and provisions for protection of labour will get diluted,” he said.
Biswajit Dhar, a professor at Delhi’s Jawaharlal Nehru University, said changing labour Laws at this point will not solve the government’s problems. “Steps like increasing the duration of the workday is a recipe for disaster; what we need is to focus on giving more money in the hands of the labourers,” he said.
The CII was not available for comment.
THERE IS A PROPOSAL TO GIVE A LABOUR LAW HOLIDAY FOR THE FIRST 1,000 DAYS TO THOSE WHO START VENTURES IN MADHYA PRADESH