India has too many labour regulations: Rajan

PTI New Delhi | Updated on March 15, 2013 Published on March 15, 2013

India has too many labour laws but the least number of workers protected under law, said Raghuram Rajan, Chief Economic Advisor to the Finance Ministry.

India has the least number of workers protected under law in the world even as the country’s labour market has too many regulations, Raghuram Rajan, Chief Economic Adviser in the Finance Ministry, said today.

“India’s labour market is over regulated ... One of the features of the Indian labour market is that it gets the strongest protection under law. But if you look at workers’ protection in India compared to world, we have the least number of workers protected,” Rajan said while addressing the India Today Conclave here.

“We have too much regulation, we have too many regulations at the wrong time, sometimes little less regulation at the right time. We need to figure out what we need and pick out what we don’t need,” he added.

Labour reforms have been pending in India for long.

Amendments to various labour laws have been awaiting Parliamentary approval.

Rajan also emphasised careful implementation of the Government’s welfare programmes.

“The Government’s subsidies have to be carefully targeted, and subsidy programmes have to be efficient, we as a poor country, cannot afford a poorly targeted or inefficient welfare programme,” he said.

On growth and equity, Rajan said, “We currently have programmes such as food, education health and pensions but the key question is, how much should we do, who should be target.”

Rajan, a former chief economist of IMF, predicted that the welfare state in Europe and the US is unsustainable.

Published on March 15, 2013

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