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Journalism of Courage
While indicating that the process of pushing through structural economic reforms may be arduous, Finance Minister Arun Jaitley on Wednesday said the NDA government is working on a series of fresh measures that include further easing of labour regulations and changes to the new Land Acquisition Act.
Addressing the opening day of the two-day India Economic Summit, Jaitley also said a push to the disinvestment process and changes to the norms on allocation of natural resources are on the anvil.
“Some think that the second generation of reforms in India probably need one or two big bang ideas. But reforms is not about one sensational idea… you can damage the economy by just one bad idea,” he said, pointing out that the provision of retrospective taxation was one such proposal that damaged the prospects of the Indian economy.
Expressing satisfaction at the measures taken by the NDA government in the last few months, Jaitley said India was moving back on the radar of investors. “There is a buzz surrounding India now,” he said. He, however, called for foreign investors to participate in developing India’s infrastructure, which, he said, “has been facing financing issues of late.”
After the government recently laid down the guidelines for auctioning of coal blocks, Jaitley said the Centre is considering similar reforms for mining of other minerals. “With regard to other minerals, we are about to take similar reforms to eliminate the possibility of discretion and crony capitalism,” he said.
He also expressed hope that the Insurance Laws (Amendment) Bill would be passed in the coming session of Parliament.
Pointing out the limitations posed by the new land acquisition law, which checks acquisition of land even for crucial sectors like defence and housing for poor, Jaitley said the government is reviewing the second part of the law that deals with land acquisition.
“The law lays down a very complicated procedure for land acquisition. Conceptually, acquisition of land is always a sovereign right because you need land for everything including building defence cantonments, highways and houses. Therefore, if land acquisition is made complicated, then the growth process itself gets stalled, and this law has made it extremely complicated… Now, since the confusion has been established, the time has come that at least the second part of the law is relooked,” said Jaitley, adding that the government has no issue with the new compensation and resettlement scheme as proposed in the land acquisition law.
Jaitley said the labour laws need to change and the process has been started, though he did not give a timeline for the same. “Some aspects of the labour laws in India can certainly be improved and rationalised,” he said, but cautioned that this would need larger discussion as the government needs to convince people that flexible labour laws would help create more jobs.
Meanwhile, maintaining that though the government would continue its current policy of disinvestment, the Finance Minister said it could also consider sale of some loss-making public sector firms as they often employ a large number of people but are on the verge of closure. “But certainly, I would be open to look at some set of PSUs that could do much better in private hands… So, given a choice between their continuing in the present shape or getting privatised, the second option would be a preferable option. Currently they are being sustained on government support, and that is not a long term solution,” he said.
