For increasing Ease of Doing Business and making India an attractive investment destination, it is imperative to deal with the complexities and high compliance costs associated with existing labour laws at both centre and state level. Discuss. What steps have been taken by the central government to address these challenges?

Labour laws in India are enforced by both central and state governments, which lead to multiplicity of laws and high associated compliance costs.

Effects of such complexity:

  • Reduces ease of doing business, difficult to set up compliance mechanisms across the separate states.
  • Lack of benefit portability among workers – adversely affects migration.
  • Pushes up costs for companies.
  • Leads to lack of employment opportunities.
  • Unequal regulation leads to lesser wages for workers in some states.

Steps taken by the Centre:

  • Passing of wage code bill – Consolidates various labour laws including payment of which is it, bonus act, etc, equalised minimum wage across similar geographical areas, easier compliance.
  • Shram Suvidha portal – Compliance online by integrating various labour regulations, Ensures social security portability.
  • Various pension schemes and welfare schemes for workers (PM Shram Yogi Maan-dhan Yojna), Provides assured pension and social security to workers.

The success of India is an investment destination depends upon is of compliances. Such measures also boost employment. Taking steps to implement these issues, it should be ensured that workers rights are not affected.

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