To enhance textile exports, govt set to import hire-and-fire norms

NEW DELHI: The warp of labour reforms may be laid in the textile sector. The textile ministry has proposed an amendment to the Industrial Disputes Act, 1947, for letting textile exporting units hire and fire.

“Several state governments have already liberalised labour laws to attract investment and promote large-scale manufacturing. The labour ministry is taking note of the developments, and is likely to give nod for labour reforms in certain sectors. This could be started with units facilitating exports,” labour ministry sources said.

The textile ministry has already moved a Cabinet note for limited amendment to the Industrial Disputes Act, sources added. According to the proposal, labour law restrictions would be eased only for textile exporting units providing a minimum employment guarantee of 100 days a year.

The textile ministry has also mooted increasing the working hours from 48 hours per week to 60 hours, and daily working hours from 9 to 12.

The Cabinet note moved by the ministry also seeks to put an end to wildcat strikes by increasing the notice period before a strike.

“It is imperative to address rigidities of labour laws so that the industry can realise the export potential and, thereby, create additional job opportunities,” a textile ministry official said.

Industry players are also of the view that the lack of flexibility in labour laws is hampering the textile industry’s ability to compete in the global market.

“Garment industry needs flexible labour laws to compete at world level. Compared to China, our labour productivity is 20% less. The government move is in the right direction. This should not be taken just as hire-and-fire norm as the flexibility will generate more employment in the textile sector,” Vardhman group chairman and CII working group textile head S P Oswal said.

With most of these units operating in export processing zones and other exports-facilitating industrial zones, it is felt that initiating labour reforms in this sector may remain non-controversial.