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Impact of budget proposals on textile industry by Surinder Anand

Mar '07
Impact of Budget proposals on textile industry by Surinder Anand:

Although, the Finance Minister, Mr. P.Chidambaram, has dexterously handled the tedious task of striking a balance between the needs of development and social and political compulsions of the present economic situation, and has taken steps to achieve the objective of boosting economic growth and employment generation, the exporting community feels being left in the lurch without an adequate fiscal relief in the Budget proposals.

While giving emphasis on agriculture, social sector, education, health and infrastructure, the industry and trade, unfortunately, have been neglected. The Budget, presented in prevailing environment of strong economic growth and buoyant investment climate, though, expressed concern at the rising inflation rate.

The Budget 2007-08 has given more importance to the rural sector of the economy so as to improve the investment in agriculture and rural infrastructure but there are some important issues which have remained untouched, especially the promised Labour Reforms with flexible Labour Laws so crucial to achieve the substantial employment potential for seasonal garment industry.

We have, time and again, failed to update and revise our Labour Laws, which continue to seriously restrict exporters to 'hire and fire' labour when required. In In India, garment export is season-ridden. There are long no-work periods during which the exporters have to maintain and pay the labour force. The garment export industry, therefore, badly needs flexibility to adjust workforce in tune with the changing demand patterns, which depends on changing fashions, product life cycles and competitions.

While discussing the Indian economy, it is often forgotten that there is a close link between economic, industrial and labour policies. If sweeping changes made in one sphere are not followed up by corresponding measures in others, the whole purpose of so called pragmatic policy planning gets defeated.

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