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Indian Stock Market News, Equity Market and Sensex Today in India | Equitymaster
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Modi kick starts the wheel of reform 
(Tue, 1 Jul Pre-Open) 
 
Prime Minister Narendra Modi has set the ball rolling by kick-starting a much promised reform measures. Labour overhaul! That's the first to kick-off amidst other priorities. Job creation backed by revamp in decade old labour laws, need for revival of the sagging economy and boost to the manufacturing sector is the key agenda for the government.

Fathom this! 200 mn youth are set to join the job industry over the next two decades. But is the labour market ready to absorb this massive number? Unfortunately not. That's because the ugly labour laws marked by union-led movements and petty politics have spoilt the game.

That the age old patriarchal labour laws need to undergo a change is given. But the rigidity in the labour markets and the scope to circumvent the labour laws has been its biggest undoing. Therefore, a lot is expected from the new guard at the centre. But will the Modi government help liberalize the labour market? Well, that's too early to be judged. But we definitely know how effectively the government can revive the distressed labour market. The most welcoming change expected amongst all is the liberal labour laws that would ensure maximum job security to the workers. By making dismissal of workers difficult, the government can try provide a secured and sensitive work environment to workers. Hire and fire policy should be done away with. As per a leading daily, the labour ministry already has a three-point agenda in place in this regard. Minimum wages for more number of workers, increase in overtime hours and permission to women for night shifts and more will go a long way in creating a hassle-free environment both for the workers and the industry.

Well it's high time that India breaks the shackles of 20-year long run of fast economic expansion and jobless growth. Indian labour market has been the victim of lower productivity and low quality jobs. Moreover, the manufacturing sector slowdown and the resultant business downturns have also impacted the job market for years together. Not just that. Violent labour protests at manufacturing units and ulterior motives of labour unions have also damaged the industry. A labour protest at a Maruti Suzuki factory in 2012 that resulted in a death of a company official is a case in point. Thus the need to pace up labour reforms is the highest is definitely not an overstatement. So while the government has done the right thing to begin the economic revival with kick-starting labour reforms, the early execution will make a difference. Till then we wait and watch!

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