India Uncut

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Monday, February 07, 2005

Show me your spittoons

I always knew that India’s labour laws are archaic, but a wishlist of changes drawn up by the Confederation of Indian Industry (CII) made my jaw drop. Andy Mukherjee of Bloomberg mentions a couple of them in an article on labour laws, and the one I found most mouthwatering was the requirement that “in every factory there shall be provided a sufficient number of spittoons in convenient places”. So the government inspector can come to your state-of-the-art modern factory and demand to see your spittoons. Obviously, you then end up greasing his palm.

The article points out that Manmohan Singh, with the left parties sitting on his shoulders like a mad dwarf, may not be able to overtly change the labour laws, but quiet change is happening nevertheless. For one, special economic zones are being set up which will be “away from the regulatory framework,” in the words of Kamal Nath, the trade and industries minister. Also, service companies in India have often lobbied successfully for exemption from these labour laws. A call centre would hardly be able to function if it had to abide by the working hours laid out in the Shops and Establishment Act.

But the costs of these labour laws have been harsh for India. A study that the article cites (“Can Labour Regulation Hinder Economic Performance? Evidence from India” by Timothy Besley and Robin Burgess of the London School of Economics) examines this in some detail. To download a PDF of that study, click here.

(The link to this piece was very kindly sent to me by Bridal Beer. Her blog is a wonderful read, by the way, and surely holds the seeds of a best-selling book. Maybe even a film based on the book, with Konkona Sen Sharma in the title role. Watch that space.)
amit varma, 12:47 PM| write to me | permalink | homepage

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