2018-CGS-29: Mains Revision-17: Secondary Sector of Economy

Prioritising Labour Reforms

The long pending labor reforms are yet to be taken to logical end. Pending labor reforms are adversely affecting the economy. It is time for India to expedite its efforts towards labor reforms but the reforms are caught up in a complex situation

Labour reforms: Need for India

  • India is fast losing its competitive edge in exports and enterprises at home are increasingly automating operations. This is adversely affecting the labour market. Archaic labor laws are said to be the cause behind this phenomenon.
  • The Draft Code on Wages, 2017 seeks to usher in the concept of a statutory minimum wage suits the political interests of both the government and opposition as the country is heading for general election. The impact of this on industry is not given due importance.
  • The crucial Labour Code on Industrial Relations already diluted to pacify labour unions is now unlikely to see the light of day. The government had first sought to allow companies to lay off 300 workers without approval but later abandoned the idea saying it would stay with the current level of 100 workers. Ideally, the threshold should be 1,000 persons.
  • Even smaller establishments need to be able to hire and fire, or they will simply stop relying on permanent work-forces. The Centre had also objected to proposals from Madhya Pradesh to exempt micro industries those with an investment not exceeding Rs 25 lakh from the purview of seven central laws, including the Contract Labour Act and the Factories Act, even though the state had pointed out that small factories were unduly subjected to harassment.

Countries with more practical labour laws such as Bangladesh have been growing their share in the global textile market at India’s cost. It’s high time for India to revisit the labor reforms and initiate labor reforms before it is too late. [Financial Express]

Draft National Telecom Policy

The Policy aims to accomplish some of the strategic objectives by 2022 including Provisioning of Broadband for all, creating four million additional jobs in the digital communications sector, enhancing the contribution of the digital communications sector to eight per cent of India’s GDP from around six per cent in 2017, enhancing India’s contribution to global value chains and ensuring digital sovereignty.

Components of the policy

  • The draft recognises spectrum as a key natural resource for public benefit to achieve India’s socio-economic goals, optimise availability and utilisation by making adequate spectrum available to be equipped for the new broadband era.
  • It calls for optimal pricing of spectrum to ensure sustainable and affordable access to digital communications and simplifying the process of obtaining permissions from various agencies
  • It proposes identifying and making available new spectrum bands for access and backhaul segments for timely deployment and growth of 5G networks and making available harmonised and contiguous spectrum required for deployment of next generation access technologies.
  • It calls for a transparent and fair mode of spectrum allocation by developing a fair, flexible, simple and transparent method for spectrum assignments and allocations.
  • The draft also talks of National Broadband mission to secure universal broadband access for implementation of broadband initiatives, to be funded through USOF and Public Private Partnerships
  • The Policy also speaks about strengthening Satellite Communication Technologies in India and said there would be review of the regulatory regime for satellite communication technologies.
  • On ensuring quality of services, it talks about establishing effective institutional mechanisms to protect consumers’ interests including a Telecom Ombudsman and a centralised web based complaint redressal system.
  • The Policy talks of incentivising the use of renewable energy technologies in the communications sector, including utilisation of small cell fuel batteries, lithium-ion batteries or other similar technologies; promoting research and development of green telecom through active participation of stakeholders across government, industry and academia.

Criticisms against the policy

  • Instead of cutting levies, the draft policy just talks of catalysing investments by reviewing levies and fees including Licence Fee, Universal Service obligation Fund (USOF) levy and rationalising Spectrum Usage Charges (SUCs) to reflect the costs of regulation and administration of spectrum.
  • No component to do anything about spectrum prices that had been unfairly jacked up by restricting supply, telling telcos their licenses wouldn’t be renewed if they didn’t buy spectrum.
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