In a State of
Denial ?
Today’s Business Standard carries a news report titled
:
Narendra Modi likely to announce
big-bang economic package on Monday
Prime Minister Narendra Modi is likely to announce some big-ticket
measures on Monday — also the birth centenary of Sangh Parivar icon Deendayal
Upadhyaya — to stimulate the economy, which saw growth plunging to a three-year
low of 5.7 per cent in the first quarter of 2017-18.
Modi might announce a package for
power, housing and social welfare programmes to generate jobs and perk up
demand. The package is being pegged at Rs 40,000-50,000 crore.
If anyone thinks this stimulus will turn
the economy around , he is in a State of Denial !
Last quarter , “ Manufacturing Sector “ grew at 1.6
% , whereas “ Service Sector “
grew at 8.7 %
Two years back , NDA government was
obsessed with the idea of increasing the share of manufacturing in our GDP from
15 % to 25 %
Now , 2 years later , exactly the
opposite seems to be happening !
It was argued that such a shift ( from
SERVICES to MANUFACTURING ) , will provide jobs to those 12 million
youth joining the ranks of UN-EMPLOYED , each year
But PRIVATE investment in Manufacturing
is just not happening ! Nor likely to happen , any time soon !
And , if and where , it is happening ,
very few new jobs are getting created ( - what with creation of just ONE job in
large organized sector , requires CAPITAL of around Rs 1 CRORE ! )
With ever-rising wages , more and more ,
industrialists are going in for AUTOMATION through deploying ROBOTS – which do
not demand salary-raise / do not get tired / work for 24 hours / do not take
leave or go on strike or mind being laid off …etc !
And when the businesses do need
some humans ( to work in factories / offices / shops / warehouses etc ) , they
are hiring TEMPORARY STAFF from companies like TeamLease etc )
Business Line ( 16 Sept ) reports :
“ Yet , organized temp staffing is
expected to touch 2.9 million by 2018 from 2.1 million a year ago , making India the third largest employer of such staff
after the US and Japan , where 7 – 11 per cent of the work force is under this
model “
Why such a sudden “ love “ for temps ?
Temps are not a permanent liability,
governed by umpteen unwieldy labour laws
They can be “ let go” , if there is a
downturn in business ( without inviting problems associated with retrenchment
related laws )
May be , such TEMP STAFFING is neither governed by Contract Labour ( Abolition and Regulation ) Act - which
carries onerous conditions in respect of wages to be paid / absorption into
permanent cadre after continuous service of 11 months / leave ..etc !
Just pay some , mutually agreed upon
lump sum for an OUTCOME ( - and not hours worked , with or without outcome ! )
I suppose the TEMP STAFFING providers
take care of all of these headaches , leaving the business free to focus on its
core activities
It is not difficult to see why our SERVICE SECTOR is growing at a rapid pace
Because , it is largely consists of SELF
EMPLOYED , who
·
Deliver to you their services at your home for a lump sum
Here are a few examples :
Cook / Carpenter /
Driver / Electrician / Florist / Housemaid / Housekeeper / Yoga Instructor /
Tutors / Maid / Nurse / Painter / Personal Trainer / Physiotherapist
/ Plumber / Repairer / Singer / Social Worker / Street vendor / Delivery Boys /
Cleaner / Mason / Scrap Collector etc
When will our Policy Makers realize that
they need to :
·
stop chasing the MIRAGE of MANUFACTURING
·
just get out of the way of the Self Employed by trying to “ regulate “
their businesses
·
encourage temporary employment by abolishing the Contract Labour (
Abolition and Regulation ) Act
·
Totally re-write the Apprentice Act / Factory Act
·
Introduce “ Human Enterprise Act “ which turns our economy around by
making it a “ Low Cost Economy “
This is the STIMULUS PACKAGE that will revive
our economy
23 Sept 2017
www.hemenparekh.in
/ blogs
With Regards,
hemen
parekh
(
M ) +91 - 98,67,55,08,08
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