New Delhi: A high-level committee on manufacturing headed by Prime Minister Manmohan Singhon Thursday approved a draft national manufacturing policy.
The Prime Minister, however, directed the commerce and industry ministry to conduct further inter-ministerial consultations before the draft is taken to the cabinet for clearance.
Singh said the consultation should be completed within a month.
Mint had reported on the contents of the policy on Thursday, having reviewed a copy of the document.
Singh said the policy measures proposed would reduce the compliance burden on industry, according to a press statement released by the Prime Minister’s Office after the meeting. “At the same time, these measures have to be formulated while adequately taking care of the environmental and labour welfare concerns,” the release said.
Rajiv Kumar, secretary general of the industry lobby Federation of Indian Chambers of Commerce and Industry, said he is not frustrated by the delay in the policy decision. “I have to be optimistic on this one. Earlier, there were three draft policies floating around. At least now there is a single draft. We hope within a month’s time the policy will be cleared,” he said.
The industry department first issued a discussion paper seeking comments on such a policy in March last year. This was strongly opposed by the environment and labour ministries as well as trade unions for its liberal approach.
The policy aims to increase the sectoral share of manufacturing in gross domestic product from the present 16% to at least 25% by 2025 and to create an additional 100 million jobs in the manufacturing sector by 2025.
As reported on Wednesday, the policy intends to incentivize Indian firms through tax concessions, subsidies and the relaxation of labour laws. The draft policy also proposes a comprehensive exit policy for industries that will promote productivity while providing flexibility by removing “rigidity in labour market”, while ensuring protection of workers’ rights.
The thrust with regard to labour management will be to encourage unions and employers to develop better institutional arrangements and conventions in the states and in production units through dialogue and consultation, the draft policy states. “The stress will be on modification in employment laws and in shop floor practices.”