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Policy & Politics

Government aims to become self-reliant in silk sector in two years

Tarun Nangia

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Smriti Zubin Irani, Union Minister of Textiles and Women & Child Development Government of India today said that the recent Budget has brought cheer to the textile industry with the announcement of seven mega textile parks. Additionally, INR 10,000 crores have been dedicated by the Govt of India for PLI schemes, specially dedicated to MMF and technical textiles.

Addressing the inaugural session of the Karnataka VastraTek – Apparel & Textile Conclave organised by the Department of Handloom and Textiles, Govt of Karnataka in association with FICCI Karnataka State Council, Ms Irani elaborated on the growth of the silk sector in the state, Ms Irani said that Karnataka reigns in the realm of silk. “Under the Silk Samagra Program, the Govt of India dedicated specifically over INR 2,000 crores for the development of silk. I am hopeful that the industry gives the state of Karnataka ideas, proposals or initiatives that can make our country Atmanirbhar in silk. We in the Ministry of Textiles are looking at the next two years to ensure that India is self-reliant in the space of silk,” she said.

“Just reducing the produce line to saris and garments would be doing a great injustice to the potential of the silk sector. We are aware that silk, especially the waste of a cocoon can be used by pharma and cosmetic companies. We are hopeful that industry captains can suggest usage of silk waste to help elaborate our production line or elaborate our diversification prospects, Ms Irani added.

On the future of textiles in the state of Karnataka, the Minister said that the MSP operations for cotton procurement by the Cotton Cooperation of India has touched over INR 359 crores in the state. “From 2014-15 to this year, the Ministry of Textiles has extended support of over INR 1,622 crores only for cotton procurement and MSP operations benefiting over 1.67 lakh farmers,” she said.

Highlighting the importance of the handicrafts sector, the Minister said that Pehchaan Cards were distributed to over 26,000 artisans. The latest handloom census has brought to light that there are over 50,000 weavers in Karnataka who are looking at new opportunities digitally to expand their markets. She further suggested that on lines of the GeM portal that has brought on-board over 1,50,000 weavers from across the country, a similar digital opportunity is given to the marketing of artisans and weavers of Karnataka.

The textile and the apparel sector were tested as an industry during the COVID times and we rose to that challenge nationally and internationally by becoming the second largest manufacturers of PPE suits. “The fact that we could turn around our manufacturing processes in less than 60 days to meet the immediate need of our country speaks volume and is a testimony to the talent of the textile industry,” she added.

Mr Shrimanth Balasaheb Patil, Minister of Handloom and Textile & Minority Welfare Department, Government of Karnataka said that the state was first state to implement a dedicated textile policy and has been an inspiration to other states in the country for the same. The Doddabalapur Integrated Textile Park is the first integrated textile park of the country spread across 48 acres of land and has over 85 units focused on weaving, warping, among others and has generated employment for over 8000 people.

“The Govt of Karnataka is committed to providing world class facilities with easy access to railways, airports and ports for the smooth export of goods and materials. The new Textile and Apparel Policy 2019-2024 has been formulated keeping industrial requirements in mind and the incentives provided is the best in the country. With constant monitoring, the sector will be able to tide over the difficult situation induced by the pandemic,” he said.

Mr Ullas Kamath, Chairman, FICCI Karnataka State Council & Joint Managing Director, Jyothy Labs Ltd said that the special emphasis given by the union budget 2021 to the textile and apparel sector to set up large textile parks are extremely important.

“Very few countries can boast of robust textile value chains that India has. Karnataka has been one of the key states of apparel and garment supplies to both domestic and international markets and the textile industry occupies key position in terms of its contribution to the state’s economy. The policy intervention by the Govt of Karnataka have created thriving manufacturing clusters.” he said.

The FICCI Karnataka State Council has been taking sector specific initiatives to improve industry performance. For the textile and apparel sector we are forming a subcommittee with leading garment manufacturers and this will certainly help to bring more vibrancy, he added.

Dr A Sakthivel, Chairman, Apparel Export Promotion Council (APEC) said that with the support and help extended by the Centre during in the last year, India became the second largest manufacturers of medical textile.

“Karnataka plays a vital role in apparel exports and does about INR 17,000 cr worth of exports per year. The state govt should utilise the PLI scheme and promote MMF garments in a big way, he said. There is a need for plug and play facilities for apparel manufacturing and processing, he suggested.

Speaking on the industry’s role, Mr R D Udeshi, President, Reliance Industries Limited said, “The time has come for the industry to come forward and be aggressive for reinvestment and become one of the major manufacturing hubs in the global arena. We, as an industry, have proved ourselves during the pandemic. From importing PPE suits to manufacturing and exporting the same, this has proved that the industry has the willpower and manufacturing excellence.”

Mr Jacob John, President – Premium Brands, Adithya Birla Fashion & Retail Limited said that the retail sector is pleased to see business bouncing back after a prolonged crisis induced by the pandemic. “With the steps taken by the govt, we expect business to attain normalcy by Q2 of FY22,” he said.

Mr Siddhartha Agarwal, Co-Chair, FICCI Karnataka State Council and Managing Director, Bhoruka Park Private Limited delivered the vote of thanks and said that the conclave had been organised against the background of the new state textile policy unveiled by the Govt of Karnataka.

On the future of textiles in Karnataka, the minister said that the MSP operations for cotton procurement by the Cotton Cooperation of India has touched over Rs 359 crore in the state. ‘From 2014-15 to this year, the Ministry of Textiles has extended support of over Rs 1,622 crore only for cotton procurement and MSP operations benefiting over 1.67 lakh farmers,” she said.

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Policy & Politics

An analysis of the New Labour Code and its impact

The effectiveness of the New Labour Code—which were supposed to see the light of the day this year but deferred by a year due to Covid-19 pandemic—will be tested in due times when the same will be implemented.

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INTRODUCTION

Labour, enumerated as entry 24 & 25, falls under the Concurrent List of the Constitution of India. Therefore, both Parliament and state legislatures are competent to enact laws regulating labour. The Union Government stated that there are more than 100 state and 40 central laws regulating various aspects of labour such as resolution of industrial disputes, working conditions, social security and wages, etc. Pursuant to the recommendations of the Second National Commission on Labour, which submitted its report in June, 2002, the union legislature passed The Occupational Safety, Health and Working Conditions Code, 2020 (hereinafter as the ‘Code’). It was re-introduced in Lok Sabha by the Union Minister of Labour and Employment, Mr. Santosh Kumar Gangwar, on September 19, 2020, with the new changes which lead to the withdrawal of the Occupational Safety, Health and Working Conditions Code, 2019 (hereinafter as ‘OSH Code, 2019’). As the OSH Code, 2019 was referred to the Department related Parliamentary Standing Committee on Labour, which suggested substantial number modifications to the code and also in the light of Covid-19 pandemic, the Union Government also proposed certain changes to the OSH Code, 2019. The Code consolidates 13 existing Acts regulating health, safety, and working conditions, which include the Factories Act, 1948; the Mines Act, 1952; and the Contract Labour (Regulation and Abolition) Act, 1970. The OSH Code intends to amalgamate, simplify, consolidate and rationalise more than 600 provisions of the 13 laws mentioned in a single code consisting of around 143 provisions.

EXTENT

The Code emphasizes on health, safety and welfare of the workers employed in various sectors such as industry, trade, business, manufacturing, factory, motor transport undertaking, building and other construction works, newspaper establishments, audio-video production, plantation, mine and dock-work and service sectors. It also aims to provide a broader legislative framework, thereby, enabling the workmen to secure just and humane working conditions and, enables the government at both the union and the state level to make rules and regulations in consonance with the emerging technologies and developments in the industrial sector.

IMPLICATIONS OR CHANGES IN THE LABOUR JURISPRUDENCE

The Code aims at reducing the burden of the employers as it replaces multiple registrations under various enactments to a single common registration, one licence and one return, ultimately creating a centrally consolidated database which will be helpful under ease of doing business policies of the Governments. The Code places an obligation on employers to conduct free annual health check-ups for their employees, to ensure the disposal of hazardous and toxic waste including e-waste, to issue an appointment letter to every employee on their appointment in the establishment.

CONSTITUTION OF ADVISORY BOARDS AT BOTH NATIONAL & STATE LEVEL

The Code states that the Central Government shall constitute a National Occupational Safety and Health Advisory Board which will discharge the functions conferred on it by or under the Code and to advise to the Central Government on the matters relating to standards, rules and regulation to be framed under the Code. The State Government shall constitute a similar type of board to be called the State Occupational Safety and Health Advisory Board which will advise on the matters arising out of the administration of the Code as may be referred to it by the State Government.

CONSTITUTION OF SAFETY COMMITTEES

The appropriate government may require a constitution of safety committees in certain establishments, and for a certain class of workers, consisting of representatives of the employer and the workers, however, the number of employer representatives shall not exceed the employee representatives. The function of these committees will be to act as a liaison between employers and employees. In any establishment which is a factory employing 500 workers or more, or a factory engaged in hazardous work employing 250 workmen or more, or a building or construction work employing 250 workers or more, or a mine where more than 100 workmen are employed in ordinary course; the employer will appoint safety officers according to the qualifications prescribed by the appropriate government.

In another welcome step towards providing some semblance of social security to the unorganised sector workers, the new Code provides for the establishment of a Social Security Fund. Any establishment having 100 workers shall have a canteen facility and that should be provided by the employer. For the appointment of welfare officers under the Code, the minimum number of workmen in any establishment is 250.

CONDITIONS OF EMPLOYMENT

Workers cannot be subjected to work for more than 6 days in a week, one day off every week and will be entitled to one day off for every 20 days of work. Workers or Employees are entitled to receive wages for the work done overtime at the rate of twice the normal wage rate as per the scheme of the Code. Under the Code provisions have been made for the employment of female employees by the employer for working beyond 7 pm till 6 am (basically night shifts) with their consent and conditions relating to safety, holiday, working hours. Furthermore, the women workers are entitled to be employed in all establishments for any kind of work including hazardous ones subject to the conditions that the appropriate government may require the employer to provide adequate safeguards prior to their employment in hazardous or dangerous operations. The Code provides that the wages to the audio-visual workers, shall be disbursed electronically and this will ensure transparency, thereby helping in keeping and maintenance of the records as well.

FALLACIES IN THE NEW CODE

As the Code consolidates the provisions of the 13 legislations related to the subject but at the same time it is unable to simplify them or be all inclusive while dealing with the matters dealt by those laws. These include provisions on registration, duties of employers, and filing of returns. It also includes additional provisions which are applicable to the specific types of workers such as contract labour, inter-state migrant workers, audio-visual workers, or those in mines, beedi & cigar workers, construction workers, factories, and plantations.

Major Safety Issues sidelined & some sectors left out

For example, the Code requires that any person suffering from deafness or giddiness may not be employed in construction activity which involves a risk of accident. The question to be posed here is why such a general safety requirement is not provided for all workers or why the legislature ignored such an important aspect. Similarly, the Code provides for registration of employment contracts for audio-visual workers, raising the question of why there is a special treatment for this category. Furthermore, the disputes related to the contracts of audio-visual workers will be resolved by the dispute resolution mechanisms devised by the appropriate government, if still the dispute remains unresolved the parties may invoke the jurisdiction of the Industrial Tribunal established by the appropriate government under the Industrial Disputes Act, 1947.

The Code under section 2(1)(zx)(a)(i) contains health and safety provisions for workers in plantations measuring at least five hectares. In its report on the OSH Code, 2019 the Department related Parliamentary Standing Committee on Labour noted an assurance of the Union Ministry of Labour and Employment, that workers in plantations measuring less than five hectares would be covered in the Code on Social Security, 2020. However, the definition of a ‘plantation’ in the OSH Code, 2019 retained the five-hectare threshold. This recommendation has not been incorporated in the Code.

NO PROPER FORUMS FOR APPEAL

The Code bars the civil courts from hearing any matters under the code. In some matters where persons are aggrieved by the orders of authorities such as, Inspector-cum-facilitator in the case of factories, or by the revocation of a license for contractors, the Code under section 119 (6) provides for an administrative appellate authority to be notified by the appropriate government. However, it does not provide a proper judicial mechanism for hearing disputes under the code but provides a quasi-judicial one to be notified by the appropriate government as opposed to the earlier regime, for example the functions and constitution of a labour court were clearly laid down under Industrial Disputes Act, 1947. It can be argued that the bar on civil courts from hearing matters under the code, deny aggrieved persons an opportunity to challenge certain issues such as relating to the contractual terms in case of contract labour before a civil court of competent jurisdiction, as such matters may be governed by the terms of contract falling under Indian Contract Act, 1872. The only judicial remedy available to a person aggrieved is to file a writ petition before the relevant High Court, as the High Court is vested with power of superintendence over the courts and tribunals functioning under its territorial jurisdiction.

WEAKENING OF THE INSPECTION SYSTEM

The Code weakens the inspection system in numerous ways. To make matters adverse, the code is silent on the powers of inspectors envisaged by ILO Conventions ratified by India, the provisions such as free entry at any time and without prior notice and as frequently as possible to secure effective application of laws by the establishments of Labour Inspection Convention, 1947 are diluted by the passing of the Code.

EXCESSIVE DELEGATION OF POWERS & REGRESSIVE APPROACH TOWARDS DEFINING KEY TERMS

Under the Constitution, the legislature is the law making organ and the executive is responsible for their implementation. It is often observed that the legislature enacts a law on a specific entry/subject within its domain covering the general principles and policies, and further, delegates detailed rule-making to the government thereby, allowing expediency and flexibility. However, time and again the courts have reiterated that certain essential functions and powers should not be delegated to the government which include, framing the legislative policy on a particular subject matter to determine the principles of the law. Also, it is the general principle that any rule made as a delegated legislation should also remain within the scope of the parent legislation. The Code in section 127, also gives the appropriate government the power to exempt any establishment for a period to be specified in the notification providing exemption. Further, it also enables the state governments to exempt any new factory from any or a group of provisions of the Code in the interest of creating more economic activity and employment. Therefore, the appropriate government has wide discretion in providing exemptions under the Code. Every factory generates employment, and public interest could be interpreted broadly. Also the exemptions could cover a wide range of provisions including those related to hours of work, safety standards, retrenchment process, collective bargaining rights, contract labour. The low numeric thresholds with respect to the number of workers would create adverse incentives for establishment sizes to remain small, in order to avoid complying with labour regulation and therefore the real intention of the legislature will remain unfulfilled as the laws will not be applicable to them. It is worth noting that the Factories Act, 1948 only permitted exemptions from its provisions during the cases of public emergency, and such exemptions were limited to three months. The Code under its scheme also envisages similar provision but however, the life of such exemptions is that of one year at a time. But the drawback here is the regressive approach of the legislature when it defines the phrase ‘Public Emergency’, in explanation to section 128 of the Code, as a state of a grave exigency, whereby, the security of the union or any part of territory is threatened due to war, or external aggression, or internal disturbance. Implications of this could be that in near future the government may invoke the internal disturbance condition to suspend the application of the code and this will be a severe blow to the rights of the workers across India.

Also, this situation could be done for indefinite time as the maximum life for a notification issued after invoking this provision is one year, but this would be circumvented by re-issuing the notifications.

CONCLUSION

The (in)effectiveness of the Code and the rules made thereunder, will be tested in due times when the same will be implemented. These reforms were to see the light of the day this year but due to another deadly wave of the Covid-19 pandemic, the Union has deferred the same by another year. Also passing of these new laws is nothing short of packing the old & aged wine, into some new bottles and displaying them, so that it may attract some new customers to the tavern.

The Code under section 2(1)(zx)(a)(i) contains health and safety provisions for workers in plantations measuring at least five hectares. In its report on the OSH Code, 2019 the Department related Parliamentary Standing Committee on Labour noted an assurance of the Union Ministry of Labour and Employment, that workers in plantations measuring less than five hectares would be covered in the Code on Social Security, 2020. However, the definition of a ‘plantation’ in the OSH Code, 2019 retained the five-hectare threshold. This recommendation has not been incorporated in the Code.

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Policy & Politics

An analysis on gig and platform workers: Code on social security

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The introduction of the social security code in India is an important step towards reformation of workplaces. Social security is commonly viewed as a sort of monetary assistance provided by the government to persons who are either inadequately employed or can’t be employed. In India, the term “social security” has a completely different connotation. Our social security system in India is made up of various labour laws that our state and central governments have enacted over several years. These govern salaries and benefits for workers, as well as safe working conditions and regulate labour and industrial relations.

The Code on Social Security, 2020, amalgamates eight previously existing labour laws of centre. These are the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952; Payment of Gratuity Act, 1972; Employees’ Compensation Act, 1923; Maternity Benefit Act, 1961; Employees’ State Insurance Act, 1948; Workers Cess Act, 1996; Cine Workers Welfare Fund Act, 1981; Building and Other Construction and Unorganised Workers’ Social Security Act, 2008.

This Code isn’t just a collection of previous laws consolidated into one. It has expanded the coverage, made benefits available to all workers in the organised and unorganised sectors, incorporated notions of giving maximum benefits with minimal governance, and demonstrates consistency in approach. The Code aims to bring uniformity to the provision of social security benefits to employees, which were previously divided into different acts with varying applicability and coverage. The Code also attempts to give social security to a large group of workers by recognising and covering workers in the unorganised sector. Under this code, draft rules have been published by the Government.

The law also broadens the scope to include fixed-term contract workers, who will now be entitled for gratuities, whereas previously only permanent employees were covered. As per the Code, an employee is entitled to gratuity if they are terminated from their job after a continual service tenure of at least five years, which is the same as earlier. The events that would lead to gratuity are as follows: retirement, resignation, death or permanent disability as a result of an accident or illness, or termination of a contract under a fixed-term employment contract, or on the occurrence of any event notified by the Centre. In the eventuality of an employee’s death, the gratuity would be payable to the employee’s nominee or legal heir. As a result of the inclusion of the term “expiration of fixed-term employment”, now fixed-term contract employees too will be entitled for gratuity.

Under the new laws, these workers will be covered by social security benefits such as income services and health insurance. Several new terms have been developed, such as gig workers, platform workers, and fixed-term employees, which previously were not acknowledged by any labour laws. Gig workers and platform workers, who are part of the unorganised workforce, were not legally recognized by the Government for many years. Since these workers were not paid on a salary basis, they were deprived of many benefits such as Health Insurance, Provident Fund, etc. The new regulations provide gig workers a shared identity.

Definition of “Gig Worker”In India, the phrase “gig worker” is a relatively recent notion. Generally, a gig worker is someone who works hourly or does part-time jobs in various fields, ranging from catering events to developing software, and many more. The job is generally temporary and performed within a set timeframe under an unusual employment arrangement. The term “gig worker” is defined in the Code as, “a person who performs work or participates in a work arrangement and earns from such activities outside of traditional employer-employee relationships”. The legal identification of gig workers was urgently needed because the concept covers a large group of contract employees. Even a part-time professor can be covered in the gig economy. Contingent employees, freelancers, and independent contractors are just a few examples of prevalent names. The gig economy finds its origin and is mostly popular among youths in western countries. This model enables students to start working at a young age and get expertise in their chosen fields. The perks involved with such employment would inspire individuals in India to pursue these jobs and avail benefits that arise out of it.

Definition of “Platform Worker” In general, a platform worker is someone who works for an enterprise that offers specific services to clients, customers, individuals or organisations through an online platform. Uber, Ola, Zomato, etc. are some of its examples. According to the Code, a platform worker is, “a person engaged in or undertaking platform work”. In order to have a fuller insight, the definition of platform worker must be read in conjunction with the definition of platform work, which specifies what platform work is. It is defined as, “a work arrangement outside of a traditional employer employee relationship in which organisations or individuals use an online platform to access other organisations or individuals to solve specific problems or to provide specific services or any such other activities which may be notified by the Central Government, in exchange for payment.’’

WHAT’S THERE FOR GIG AND PLATFORM WORKERS IN CODE?

The Central Government has proposed to generalize benefits such as health and maternity benefits, as well as life and disability insurance. The state government is responsible for providing benefits to workers such as provident fund, skill upgradation, and accommodation. Nirmala Sitharaman, the Finance Minister of the nation, has also stated that all sorts of workers would now be subject to minimum wage regulations and that the Employees State Insurance Corporation, or ESIC, will apply to the government. The Centre also has no information about how many gig workers at present are now employed in India; however, some independent estimates put the figure at above 130 million. To reap the benefits of these planned incentives, the government has planned to create an online platform for all qualified unorganised workers in the country by June 2021. It’s mandatory for all the gig and platform workers to register on this portal. In order to be eligible, the worker must be over the age of 16 and under the age of 60. Also, they have worked for at least 90 days in the past 12 years. The worker would be required to submit a self-declaration, either online or offline, as well as additional documents, including the Aadhar Card. The Central Government could also choose five members for the unorganised sector to the National Social Security Board, which will frame policies and regulations for gig and platform workers. Furthermore, the Code requires aggregators, or employers in the case of gig workers, to donate a set proportion of their revenue to a social security fund for the unorganised sector’s welfare.

Amidst this pandemic gig economy has been a major help to the country. When we all were staying at our homes due to the fear of getting infected by the virus, various workers of online platforms like Zomato, Swiggy, etc, were providing services ranging from delivering food to delivering medicines.

India is now seeing a booming phenomenon where a lot of start ups are coming up and their business model rests on such kind of an arrangement where they are engaging these people on an independent contract basis meaning thereby, that there is no employer employee relationship with them and so they are not suppose to comply with all the labour laws that exist in the country because all of them focus on an employee so one concern is that if a recognition is given to these gig workers then even the business model of these organisations might collapse because they are engaging these people in thousands of numbers.

Second concern is related to these workers who have constantly been asking for certain minimum benefits for themselves. A couple of years back certain organisations of these workers came forward and filed a PIL in Delhi High Court asking for setting up of a committee that can examine whether they can be treated as an employee, whether they can get the benefits under labour laws but there was no headway on that front. So, its very tricky balance to meet. So, government has tried to do that by not saying that these are employees on one hand and on the other hand giving them atleast social security benefits meaning thereby providing life benfit, health benefit, benefit in relation to accidents. So, the government plans to formulate a scheme under the code on social security which will provide atleast these benefits to gig workers, platform workers there has been an attempt to balance both the interests.

CONCLUDING REMARKS

We are witnessing the rise in the trend of people using online platforms like Zomato, Uber etc. on a day-to-day basis and with the increase in the services provided by the online platforms there will be increase in number of people working for these platforms. So it becomes of utmost importance to formulate a robust scheme to safeguard the welfare of the people working for the online platforms.

Although, the government has recognized the workers working for online platforms by introducing the definition in the Code on Social Security but only the introduction of the concept is not enough there are many things needed to be done. First concern is that since that there is only one code that defines the concept of gig workers. Now, when we look at both the definitions of gig workers and platform workers one can interpret that Platform worker seems to be a narrower concept falling within the wider concept of gig worker. Now, this problem paired with the lack of definition in the other codes leads to confusion with regards to what gig workers can avail in terms of protections and minimum wages, etc. The lack of clarity in the definition also leads to large ambiguity allowing the platforms to decide who is a gig worker and a platform worker.

Secondly, the Judiciary should also give certain recommendations for the welfare of Gig Workers as till date we lack on judicial front when it comes to take steps for gig workers. On 19th February, the Supreme Court of the United Kingdom in Uber BV & Ors. v. Aslam & Ors. ruled that Uber drivers should be treated as employees rather than independent contractors, making them liable for all employment-related benefits such as minimum wage, annual leave, and insurance. No such issues with regards to gig workers have been dealt by Judiciary in India. In 2018 the Delhi High Court in the case Delhi Commercial Driver Union v. Union of India was posed with the question that whether these workers can be conferred with the status of worker but before this question could be answered the matter was eventually withdrawn, thereby pushing out employment status of gig workers in India to a later date. So, there is a need for proper guidance on the issue by the Judiciary so that a proper policy could be framed by which the interest of the workers and online platforms can be balanced.

The Central government has proposed to generalise benefits such as health and maternity benefits, as well as life and disability insurance. The state government is responsible for providing benefits to workers such as provident fund, skill upgradation, and accommodation. Nirmala Sitharaman, the Finance Minister, has also stated that all sorts of workers would now be subject to minimum wage regulations and that the Employees State Insurance Corporation, or ESIC, will apply to the government. The Centre also has no information about how many gig workers at present are now employed in India; however, some independent estimates put the figure at above 130 million. To reap the benefits of these planned incentives, the government has planned to create an online platform for all qualified unorganised workers in the country by June 2021. It’s mandatory for all the gig and platform workers to register on this portal. In order to be eligible, the worker must be over the age of 16 and under the age of 60.

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Policy & Politics

SURROGACY BILL AND REPRODUCTIVE RIGHTS: AN ANALYSIS

Atulendra Rathour

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To regulate surrogacy in India, the Surrogacy (Regulation) Bill, 2019 was introduced and was passed in Lok Sabha but was later sent to Select Committee. The Select Committee made some changes and introduced a draft of the Surrogacy (Regulation) Bill, 2020. Union Cabinet approved it on 26th February 2020. The bill is yet to be introduced in the Lower house in the upcoming session due to a pandemic its introduction is delayed.

The new bill allows any woman to surrogate willingly as the earlier bill only allowed close relatives to be surrogates. The clause defining infertility has also been removed to make access to surrogacy easier. This new proposed Bill is a better version of the previous 2019 Bill. Many of the loopholes related to the previous bill has been covered but still, it relies on a Need-based approach instead of emphasizing a Rights-based approach. The bill prohibits Commercial Surrogacy and promotes Altruistic Surrogacy. The bill aims to prevent further exploitation of surrogates and children born out of surrogacy. Even then, some clauses of the bill are contradictory with Women’s autonomy and their reproductive rights.

By completely prohibiting Commercial Surrogacy, also affects the bodily autonomy of women. The ethical (Altruistic) Surrogacy expects a woman to undergo the complete period of pregnancy that too without any compensatory benefit. Just in the name of compassion, love, and affection. Surrogacy is not a one-day issue to be taken so lightly rather it involves several Physical and Mental ups and downs. Banning commercial Surrogacy is also a strong move towards constraining the income of Surrogates as the $400 million – a year industry will come into its foot. This bill will further motivate surrogates not to go for surrogacy which will lead to the disappearance of surrogacy and will affect couples’ rights to avail child.

The bill also fails to pass the test of the “Golden Triangle” laid down by Apex Court in Minerva Mills Ltd. & Ors v. Union of India & Ors. The test checks the constitutionality of the laws based on Equality, liberty, and freedom of rights. The right to make reproductive choices forms a part of Article 21 of the Indian Constitution. Apex Court in Suchitra Shrivastava v. Chandigarh Administration said, “There is no doubt that a woman’s right to make a reproductive choice is also a dimension of personal liberty as understood under article 21 of the Constitution of India”. Similar contention of Supreme Court was given in the case of Devika Biswas v. Union of India. In another landmark Judgment of KS Puttaswamy, nine judges bench of Supreme Court held that Personal and bodily autonomy forms a part of the Right to Privacy under Article 21 of the Indian Constitution. High Court of Andhra Pradesh in B.K. Parthasarthi v. Government of Andhra Pradesh held that State’s interference in one’s procreation is a direct interference in one’s privacy. Right to livelihood also forms a part of Article 21 and banning commercial surrogacy will also violate this right as a large number are run their livelihood by becoming a surrogate of others.

Conclusively, it is said that the bill is an attempt to tackle the exploitation of surrogates on the other hand it is a clear violation of Women’s bodily autonomy and reproductive choices. The bill fails to overcome the patriarchal and traditional notion of society.

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Policy & Politics

RBI’S FINANCIAL STABILITY REPORT AND A CHECK ON BAD LOANS

Ishita Singh

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The financial stability report is released biannually and provides an account of collective assessment of the Sub-Committee of the Financial Stability and Development Council which is subsequently headed by the Governor of the Reserve Bank of India. As per the data the policy support and Vaccination has fostered the national recovery but the second wave of the pandemic has shown severe impacts on the economic activity. A major slip in the Gross NPA is expected in the entire banking system but furthermore the MSME is reported to be at risk as the retail loans given to the MSMEs or the quality of the credit is calculated to deteriorate which will serve a threat on the consumer credit.

Reserve Bank of India’s latest released financial stability report is like the grade card of its financial and banking sector throughout the pandemic. A preconceived notion of disruption of the banking sector has been proved inaccurate. As per the released report the banks fared much better and the non-performing asset ratio was systematically controlled and contained by the end of March 2021. The regulatory policies of forbearances and their strategic withdrawal have ensured limited impact on the balance sheets of the banks. The NPA ratio of banks stood at 7.5% for March 2021. The predictions given by RBI in July 2020 for NPA was the baseline scenario could range from 8.4 percent to 12.5 percent for March 2021, however the NPA settled at much better figures than the overestimation predicted.

Additionally, capital position of banks which is calculated as capital to risk weighted assets ratio (CRAR) was also reportedly deteriorated from 14.6 percent in March 2020 to 13.3 percent by March 2021. Banks incredibly raised capital through Public Issues and Qualified Institutional Placements resulting in an improved capital position during the financial year 2020-2021. The capital position of banks despite of the outbreak of the pandemic improved to 16% in March. Taking into ambit the stressed scenarios the Reserve Bank of India doesn’t anticipate the 46 banks to fall short of capital.

As per the report released by the Reserve Bank of India, banks have enough capital to recover from the collapse of any asset functioning or management. The allocated proportion of provisions to gross non-performing assets hiked from the figures of 66.2% in March 2020 to 68.9 to March 2021. There were various regulatory mechanisms announced by the central Government to strengthen and facilitate individuals who were hit by the pandemic and faced economic crisis due to lack of income facilities. The measures comprised of loan moratoriums, restructuring of loans, non-accounting of NPA and their timely withdrawal etc. has contained the hike in the non-performing assets. The cooperative ventures of the central Government and The Reserve Bank of India have facilitated and incentivized banks through instruments such as the Targeted Long Term Repo Operations (TLTROs) additionally aggressively granted the sectors that are most affected due to the pandemic.

The fragile spot and an important takeaway of the report is the MSME portfolio. Three loan restructuring schemes have been implemented since 2019 to assist the MSME sector but the stress on the MSME sector continued to remain elevated as the NPA ratio for Government owned banks stood at 15.9 percent for March 2021 compared to 13.1 percent in December 2020. A reported rise in the fiscal deficit is anticipated as there is a Rs. 3 Lakh crore burden which will eventually inflate the fiscal pressure to Rs. 14 Lac crore resulting in 3-4% to the current fiscal deficit of 9.3%. Furthermore, there can be an increased dependence on the government owned securities as per the reports as banks are finding recourse investing their liquidity in Government securities.

The two major elements that have resulted in the negative growth of the Gross Domestic Product is the Gross Fixed Capital Formation and the Private Final Consumption Expenditure. It is basically the expenditure that is incurred on the final consumption of Goods and services by the resident households. The Reserve Bank of India has incentivized the financial institutions with the credit support required during the pandemic. It has furthermore provided the banks with Collateral support and has opened new credit lines. The most important step of providing a moratorium and rolling it back systematically during the pandemic has helped in containing financial crisis.

WAY FORWARD

As per the advisory guidelines in the Financial Stability Report issued by the Reserve Bank of India the banks are to reinforce their capital and the liquidity positions to fortify their status against the balance sheet distress. The demands have to be generated in the economy to balance the currents scenario, the role of the financial institutions and significant leaders will be impactful in this process. Apart from this the need for Second Generation reforms have to be initiated which shall comprise of rural development inclusive of agriculture and allied sectors and small-scale industries should be predominant. The major objective of revival of the rural economy will result in the overall economic growth and development of the country. Furthermore, increasing the efficiency of the Government owned Banks are to be prioritized. The difference between the Private and the Public service banks are just 5% in terms of NPA. The private sector banks in the baseline scenario will get to around 6% whereas the public sector banks shall be double of it resulting to be 12%. The efficiency quotient of the public sector banks is indispensable, the process of privatizing can be implemented so as to achieve the same. The private sector banks as per the end results have been more efficient and have proven be less affected by the pandemic due to their high management and strategic policies. One of the solutions to bring the banking industry out of the crucial stressed management cycle is the establishment of Bad Banks. The Bad Bank is the Asset Reconstruction Company or an Asset Management Company that takes charge of the Bad loans of the commercial banks and furthermore manages them and achieves the objective of recovering the money over a targeted period. The SARFAESI ACT of 2002 also aims to diminish or nullify the Bad loans and accounts and has been effective in achieving the set target. More stronger capital positions, good governance adding on the efficiency in financial intermediation can be the touchstones of this endeavour so that financing needs of productive sectors of the economy are met while the integrity and soundness of banks and financial institutions are secured on an enduring basis.

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Policy & Politics

JOB RESERVATION ACT WILL NOT NEGATIVELY IMPACT INDUSTRY: HARYANA CM

The Chief Minister says that the state government is working towards reducing the cap of Rs 50000 per month gross salary as mentioned in the Act so that only unskilled and semiskilled labour come under the purview of this Act.

Tarun Nangia

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“The Haryana Employment of Local Candidates Act, 2020 will not negatively impact industry in the State,” said Manohar Lal, Chief Minister, Government of Haryana during a meeting with CII delegation over virtual platform, today.

Manohar Lal assured that the Government of Haryana is with the industry and the rules being prepared for the Act are such that there will be no harassment of units in the State on account of this Act. The Chief Minister emphasised that the state government is working towards reducing the cap of Rs 50000 per month gross salary as mentioned in the Act so that only unskilled and semiskilled labour come under the purview of this Act.

The Chief Minister mentioned that through the Haryana Enterprises & Employment Policy 2020, the State has provided a number of incentives to industry for promoting employment of local youth as well as ensuring development of backward areas and requested industry to come forward and work together with the State in achieving overall development of the State.

Appreciating the Relief & Rehabilitation work undertaken by CII and Industry during the first and second wave of COVID-19, Shri Manohar Lal said that it was good to see that the industry came forward and supported the State in this crisis. Highlighting the State’s preparedness for the third wave of COVID-19, the Hon’ble Chief Minister said that the State is working towards setting up oxygen generation plants in 136 Community Health Centres of the State and is also developing a mechanism so that there is no shortage of essential medicines as faced during the second wave of COVID-19.

Speaking on the occasion, Abhimanyu Munjal, Chairman, CII Northern Region & Jt. MD & CEO, Hero FinCorp Ltd requested the Hon’ble Chief Minister that to maintain business continuity, the State Government’s expectations from the Industry in such medical and health emergencies should be communicated well in advance. Sharing a brief of the relief

& rehabilitation work carried out by CII, CII Foundation and CII Members to support citizens during the second wave of COVID-19, Mr Munjal assured the Hon’ble Chief Minister that Industry has always been on the forefront to work shoulder to shoulder with the State Government in its fight against such crisis and will continue to lend its support.

Rajiv Gandhi, Chairman, CII Haryana State Council appreciated the undying efforts of the Government of Haryana for promotion of Industry and Trade in the State under the dynamic leadership of Shri Manohar Lal .

Gandhi emphasized that while Haryana has been able to attract huge investments with various industry friendly initiatives, the recent

Haryana State Employment of Local Candidates Act 2020 has put on hold investment and expansion plans of many business houses which is not a good sign. Mr Gandhi requested the Hon’ble Chief Minister that some alternate mediums can be considered to address issue of job creation for the Youth in Haryana and the Job Reservation Act should not be forced upon the industry in the State. Mr Gandhi assured industry’s full support in increasing the employability of the State’s youth through skill development and various other means as suggested by the State Government.

The meeting was attended by CII Office Bearers of the Northern Region and Haryana including Mr Anshuman Magazine, Deputy Chairman, CII

Northern Region & Chairman & CEO, India, South East Asia, Middle East & Africa at CBRE; Mr Rohit Relan, Vice-Chairman, CII Haryana & CMD, Bharat Seats Ltd; Dr Rajesh Kapoor, Regional Director, CII Northern Region and Mr Vivek Thakur, Director & Head – CII Haryana.

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Policy & Politics

Making it happen: Sampark Foundation

Anil Swarup

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I had no experience in the school education sector when I was shifted from the dark dungeons of coal mines to the apparent bright lights of education in 2016. In this sense, I was perhaps the most ‘uneducated’ Secretary, School Education, Government of India. However, I was soon to discover that “whereas in the coal sector, mining was underground and the mafias operated above it, in the minefield of school education it was the other way round” (Ethical Dilemmas of a Civil Servant). These mafias were eating into the essentials of our society. However, all was not lost. As I travelled around the country, I discovered some marvellous work being done through public-private partnerships. One such partnership was discovered in Chattisgarh between the State Government and Sampark Foundation. The School Education Secretary in the State was an outstanding officer, Vikas Sheel who understood the relevance and importance of such partnerships. My little contribution was to see how this wonderful initiative good be scaled.

Sampark Foundation had been set up by the redoubtable Vineet Nayar in 2005, long before he quit his fruitful and lucrative job in HCL. The NGO operations were limited to grant-making philanthropy.  It was felt that hands-off approach would not work, and catalysing a large-scale transformation in education would require some disruptive, inclusive innovations.

The attempt was now to solve one of the biggest and most complex problem of low learning outcomes, which affected over 144 million children studying in more than 1 million public-funded schools in India, where 6 out 10 children in grade 5 could not read grade-2 text or solve grade-level math problems. Six million children in the age group 6-14 years were estimated to be out of school, and 36% of the children dropped out even before completing their primary education. 

Consequently, some of the finest brains in education in the world were brought together to find possible solutions to the deep-rooted problem. Finally, Sampark Smart Shala, a frugal, tech-driven program to improve learning outcome was born. It comprised 5 innovative elements, including an Audio box with a voice mascot called “Sampark Didi” and BOT- enabled mobile App that works without the internet.

At the outset, it was recognized that the teachers were the frontline change-agents that Sampark would need to enthuse and empower. But they were embedded in a complex public education system with diverse stakeholders. There was, therefore, a need to adopt a ‘Teachers First’ approach in the mission of transforming learning outcomes. However, there was an additional issue at hand. Teachers were part of the state education system, and so first Sampark needed to build strategic partnerships with state governments.

In 2014, Sampark partnered with two states, Chhattisgarh and Uttarakhand, committing to roll-out its program in three phases in 33,000 and 10,000 schools respectively. It invested in pedagogy, developing cutting-edge teaching tools, methodologies and training modules. The Foundation carried out teachers’ training, and the program was implemented, with state machinery providing support in monitoring and evaluation. The two states saw remarkable improvement in learning outcome, according to an independent third-party assessment of the program.   

Thus, Sampark leveraged public-partnership and today, Sampark Foundation is transforming learning outcomes for 1 crore children studying in 84,000 rural schools across 6 states—Chhattisgarh, Jharkhand, Uttarakhand, Himachal Pradesh, Uttar Pradesh, and Haryana– at less than $1 per child per annum.

In March this year, the Coronavirus crisis caused an unprecedented disruption in the education of millions of children, who were forced to stay at home. Most parents who could afford enrolled their children on digital learning platforms. However, parents of children studying in government schools could not afford them; besides, most online platforms were not in Hindi, the medium of instruction in government schools. Also, the content available on these digital platforms was not mapped with the state curriculum and textbooks. It was next to impossible for 1 crore rural, underprivileged children to continue their education from their homes. 

SAMPARK ROSE TO THE CHALLENGE AND FAST

Always a believer in the power of technology and innovations, the Foundation reached out to a group of 28 top-notch professionals –inspired AI developers, educators, child psychologists, game designers, graphic animators—in different countries to develop Sampark Smart Shala, an android App. Developed with an investment of Rs 10 crore, the digital platform offers thousands of teaching-learning resources in Hindi, including animated video lessons, rhymes, stories, interactive and engaging games, classroom activities, worksheets, quizzes, all mapped to state textbooks. The App, which allows users to download the content for free and access it without the Internet, is also a unique hub of crowdsourced classroom innovations. 

The platform has already been rolled out across all the 6 states through collaborations with the state governments. In just three months, it has more than 280,000 active users—mostly teachers and children–who interact with each other, share their lessons, teaching innovations and experiences. 

As no one knows when the ongoing crisis would end and schools reopen, Sampark is continuously making efforts to develop Sampark Smart Shala into a dynamic platform , with newer features and content added regularly , to ensure that teachers and children never fall of short of their teaching and learning goals in these trying times.

Soon, the platform will have first-of-its-kind AI-based personal assessment module—Sampark Didi Ke Sawaal. Aligned to the National Education Policy 2020 guidelines, this gamified test module will turn examination into a fun-filled exercise for children. The Sampark Didi Ke Sawaal AI core will deliver graphical analytics to the teacher on her mobile, which will not only quicken the process of report card generation but also help her track the learning journey of each child under her tutelage. 

Besides, e-Courses – an AI-driven, intuitive, personalized learning platform, which will offer self-paced courses on Sampark Pedagogy, teaching in COVID-19 times, soft skills development, among others, all aligned to NEP 2020 has also been developed. Each course will include video lessons, gamified quizzes, LIVE sessions with experts followed by teacher assessment and a critical feedback session through a video recorded mock class. e-Courses also offers certificates and points to teachers, giving them a chance to become a Top Teacher in their state.  

Sampark, under the inspired leadership of Vineet Nayar made it happen in the field of school education. The key to success was their ability to appreciate the fact that for any good model to scale it was necessary to partner with the States. Public-private partnership enabled them to scale the model.

Anil Swarup has served as the head of the Project Monitoring Group, which is currently under the Prime Minister’s Offic. He has also served as Secretary, Ministry of Coal and Secretary, Ministry of School Education.

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