There is an increasing trend of reserving jobs for locals in the private sector by several states in India. Throw some lights on the arguments given by states and issues associated with such policies.

In the recent past, there have been series of steps by several state governments in reserving jobs for locals in the private sector. E.g. Andhra Pradesh has reserved 80% jobs for the locals, Haryana government has reserved 75% jobs for locals in the private sector.

Arguments given by state governments:

  • Increased unemployment among the locals.
  • It is often a part of their election manifesto and has popular support from the locals.
  • Only middle and lower level jobs are reserved.

Problems associated with such reservations:

  • It goes against the spirit of National Integration and free movement and residence of people, which is a fundamental right under Article 19(1).
  • Increase in compliance costs adds burden to companies, reducing their attraction as investment destination.
  • Domino effect –If one state follows, other states are forced to follow because of popular demand and politics involved.
  • Increased scope of labour issues and corruption.

As it goes against the fundamental rights, it was challenged by various parties and stands on weak constitutional grounds. The focus of government should be on increasing employment opportunities for all and increase the ease of doing business.

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