A number of bills related to labour concerns are up for Parliamentary approval. It would be an achievement if the government does manage to get these passed and better formalize the labour system.
Seven labour Bills await Parliament nod
The Unorganised Sector Workers Social Security Bill has been passed by the Rajya Sabha and has been listed for the coming Lok Sabha session. The Bill will legally entitle the unorganised sector workers, comprising 94 per cent of the country’s labour force, to some social security benefits.
But the other six Bills, some dating back to the early days of the UPA government, are still in the queue. The Bill to amend the Labour Laws (Exemption from furnishing returns and maintaining registers by certain establishments) Act, will allow maintenance of registers and submission of returns through soft devices, making enforcement and compliance of labour laws faster and easier in times of rapid expansion of IT. The Bill was introduced in the Rajya Sabha in August 2005.
Official amendments to this Bill were approved by the Cabinet in October last year but are yet to be moved in Parliament.
A similar victim of delays is the Bill to amend Section 66 of the Factories Act, 1948, to provide flexibility in employment of women workers for night shifts, after taking adequate safeguards for their safety and transportation from the factory to the nearest point of their residence. It was introduced in the Lok Sabha on August 16, 2005.
The Plantation Labour Act, 1951, amendment Bill, which will change the definition of employer, family and workers, and add a new chapter in safety to bring it in line with the provisions of the Child Labour Act, 1986, has been introduced in Parliament and was expected to be passed in the last session.
Another casualty of delays has been the Workmen’s Compensation Act, 1923, amendment Bill, which will replace the term ‘workman’ with employee to make it gender neutral. It also incorporates provisions to remove restrictive clauses in Schedule I of the Act to make it more worker-friendly. The Bill was approved by the Cabinet in August this year and has been introduced in Parliament.
A Bill to amend the Payment of Gratuity Act, 1972, to cover teachers in educational institutes was introduced in the Lok Sabha on November 27 last year. It was to be introduced in Parliament in the last session, but was jostled out by other non-legislative business. The Bill was referred to the Standing Committee on Labour for examination and later it was decided to implement it retrospectively from April 1997. So a new Bill was prepared viz Payment of Gratuity Amendment Bill, 2008, and approved by the Cabinet in July 2008. It was to be introduced in the last session.
A more recent Bill is the amendment of the Employees State Insurance Act, 1948, to enable utilisation of medical facilities of the Employees State Insurance Corporation for implementing the Rashtriya Swasthya Bima Yojana. It will replace the Ordinance promulgated in September this year. The Bill has been introduced in Parliament but is yet to be passed.
The expectation is that GDP will grow ~7.5% this fiscal which is respectable. Growth in the first half was 7.8% .
Services to help economy grow 7.5-8%, says Chief Economic Advisor
“Services will generally have no (bigger) cyclical decline than overall GDP and certainly (decline) much less than manufacturing, which is cyclical in most countries. Services will act as a stabiliser for us,” Chief Economic Advisor Arvind Virmani told PTI here.
Virmani said the services sector, along with others, did slow down in the first half, moderating growth to 7.8 per cent in the first half of the current fiscal compared with 9.3 per cent a year ago.
However, he did not agree with the view of some that services would slow down in a major way in the second half.
“We know from cyclical events that historically services are less affected by the cyclical shocks. Whatever the source of these cyclical shocks, I don’t see any reason why that should be overturned,” Virmani said.
Even as services helped the Indian economy clock better than expected growth in the first half, many economists say that the sector would slow down much more in the second half and restrict growth to 7 per cent or less for the whole fiscal.
Virmani said: “Those who are saying growth would be 7 per cent have to tell you what slowdown they are expecting... I am saying the growth rate is 7.8 per cent (in the first half) and you will still get at least 7.5 per cent (for the entire fiscal).”
“So slowdown is implicit, but it will be consistent with the projection of 7.5-8 per cent overall growth,” he said.
For a long time our exports centered around a few 'old' powerhouses - textiles and gems/jewelry in particular. However, these are no longer the largest components of our exports. Machinery, chemicals and refined petroleum products - the 'new' powerhouses - are the largest and fastest growing components. FICCI's study suggests that while the 'old' export components were significantly hit by the global slowdown, the 'new' ones were much more resilient. This suggests that India's exports may remain robust in the future, though the domestic employment base in the 'old' sectors will see a lot of turmoil, particularly in the case of textiles.
Slowdown to continue in manufacturing: FICCI
Ficci’s survey assessed the manufacturing performance (across sectors) in terms of key parameters like growth, exports, likely scenario in the coming months and employment, and it found that the manufacturing sector has slowed down in the last few months and this is likely to continue till March 2009, which might result in job losses.
While sectors like textiles, leather and metal sectors are expected to clock decline of 3.9 per cent, 13 per cent and 30 per cent, respectively, chemicals and machinery sectors will register an increase of 5 and 17 per cent, respectively, for the month of October 2008 (these figures are only indicative as they do not cover the entire sector), revealed the survey.
About 200 companies, which included both large (with a turnover of over Rs 30,000 crore) and SMEs in each sector, were interviewed for this survey in the first week of December. These companies were from various sections like textiles, metal and metal products, machinery and equipment, leather and leather goods, chemicals, gems and jewellery, cement, among others.
The government on Sunday announced a fiscal stimulus package that included an across-the-board cut in excise duties by 4 per cent and an additional Rs 10,000 plan expenditure to boost domestic demand in the economy. A day earlier, the Reserve Bank of India (RBI) had reduced key interest rate by one percentage point, with an aim to bring down the overall interest rate to stimulate investment in the economy.
Manufacturers in some of the major sectors like textiles, metal and metal products, machinery and equipment, leather and chemicals have reportedly planned cuts in their productions ranging from 10-50 per cent between November 2008 and March 2009 due to fall in the demand in the wake of the global economic crisis. As a result, the growth of the manufacturing sector could further slow down in the coming months.
The survey also revealed that downsizing of employment in the range of 10-30 per cent is expected in leather and leather products sector, followed by metal and metal products, textiles and jewellery in next few months. Falling demand in the EU, the US, Japan and other developed countries and a steep increase in raw material prices in last few months along with liquidity crunch have, in some way, hindered the growth of the leather sector. Likewise, the primary reason for the slowdown in the metal sector is falling demand for heavy vehicles, which has reduced the demand for metals.
The Ficci survey also pointed out that exports of textiles, leather and metal products plunged sharply in October 2008 compared to the year-ago month. Textile exports are expected to decline by around 10 per cent in October 2008. However, leather exporters are likely feel the maximum impact as respondents reported that on an average their orders from abroad have declined by 62 per cent.
However, sectors like machinery and equipment, chemicals and products may not see any loss of employment in the current scenario because these sectors have despite slowdown have not posted a negative growth, according to a Ficci official.
