India needs to vehemently go for labour reforms if it wants growth and large-scale employment generation, the economic survey tabled by finance minister Arun Jaitely in the Parliament on Wednesday said.
“Labour laws have hindered the creation of large-scale manufacturing in India. It is imperative to use India’s unique demographic moment wisely and unleash the second generation of reforms,” the document said.
The government also wants to amend archaic labour laws that it says “create strong incentives for firms to avoid hiring a large number of low-skill workers.”
The govt had kicked off the process immediately after taking charge, proposing amendment to the factories Act 1948 last month.
Under the amended Act, women will be allowed to work in a number of industries they were earlier barred from and would also be allowed to work in night shifts. Another change suggested is the increase of overtime hours an employee can work in a quarter. It has been increased from 50 hours to 100.
Reacting to the news of proposed labour reforms, trade unions said the government had not consulted them on the amendments.
“The government needs to discuss the so called labour reforms before going ahead with them,” AK Padmanabhan, president of the Centre of Indian Trade Unions, a trade union affiliated to CPI(M), said.