Wednesday September 19, 2018
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Modi meets labor leaders, differences persist

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New Delhi: Even as Prime Minister Narendra Modi met labor leaders on Sunday on the eve of the 46th Indian Labour Conference, differences persisted between central trade unions and the government over the contentious issues of contract labor and minimum wages.

The meeting over tea on Sunday followed extensive consultations that these leaders had with an inter-ministerial team headed by Finance Minister Arun Jaitley earlier in the day.

Union ministers Jaitley, Bandaru Dattatreya, Dharmendra Pradhan, Piyush Goyal and Jitendra Singh were present at the meeting, an official statement said.

The trade unions represented at the meeting included the All India United Trade Union Centre, All India Central Council of Trade Unions, Bharatiya Mazdoor Sangh, the Centre for Indian Trade Unions, Hind Mazdoor Sabha, Hind Mazdoor Sangh, Indian National Trade Union Congress, Labour Progressive Federation, National Front of Indian Trade Unions, Self-Employed Women’s Association, Trade Union Coordination Centre, and United Trade Union Congress.

“The government is trying to change the labour laws without speaking to trade unions. We have made it very clear that this is not acceptable to us,” Gurudas Dasgupta, general secretary of the AITUC and a former Lok Sabha member, said after the meeting.

“We have said that we totally opposed the government’s move on changing labour laws of the country. This will hurt the interest of the workers,” he said.

“Since there is no assurance, we will stick to our stand of a strike on September 2,” Dasgupta added.

“The good thing is that the finance minister is is heading the committee. We felt good when he briefed us in front of the prime minister,” said Brijesh Upadhyay, general secretary of the BMS, which is affiliated to the Bharatiya Janata Party.

“The government has shown some positive approach on the issues raised by us. We have hope. Something will be done,” he added.

Talking to reporters after the meeting, Labour Minister Dattatreya said: “There is consensus on the issues of recognition of trade unions, Bonus Act and matters related to social security of workers. There is gap on issues related to contract labour and minimum wages. Discussions are in progress on these issues.”

However, D.L. Sachdev, secretary of the AITUC, contradicted the minister. “There is no consensus or agreement on any issue. We have not come here with any expectation of having consensus on any issue with this government,” he said.

“The issue of central trade unions’ call for a day-long strike on September 2 was not discussed so we have not responded on that. Our resolve to go ahead with the strike on September 2 has not changed,” he added.

The unions have been raising issues related to labour law amendments and a 10-point charter of demands that includes a minimum wage of Rs.15,000 per month across the country, up from Rs.5,000 to Rs.9,000 in different states and similar wages and services conditions for contract labour as for regular employees.

At a meeting earlier, trade unions unanimously decided to oppose certain proposed amendments to labour law like easing of retrenchment and unit closure norms.

“We have decided not to change our stand on certain labour law amendments which are not in the interest of workers,” Upadhyay said, adding at this meeting, it was also decided that unions would listen to government’s view on different issues during the two meetings.

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Fall Of The Currency And Increase In Oil Prices: India ‘s Turmoil

The falling rupee has given a boost to some of India’s most lucrative exports, such as software services and pharmaceuticals, which add up to billions of dollars.

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India
Rajesh Kumar, left, shares a ride to work with another employee, Dilip Swain, right, as higher petrol prices in India begin to be felt in people's pocketbooks.VOA

The fall of the currency of India to record lows and rising global oil prices have raised worries that the world’s fastest growing economy faces headwinds that could hurt the fortunes of Prime Minister Narendra Modi’s party in next year’s general elections.

From people filling fuel at gas stations to thousands of students heading out to study overseas, the impact of the slumping rupee is sparking discontent.

Having plunged by about 12 percent against the dollar this year, the rupee is one of Asia’s worst faring currencies, and as in other countries, the slide has accelerated since the crash of the Turkish lira.

“The reasons are global. We must bear in mind that in last few months, dollar has strengthened against almost every currency,” said Finance Minister Arun Jaitley recently as he tried to send out reassuring signals that India’s economy is on track.

India
The rupee has plunged by about 12 percent this year raising fears of spiraling inflation. VOA

The rupee’s sharp depreciation comes at a time when the economy had recovered from a slowdown and surged to a two-year high in the quarter that ended in June. Forecasts put growth for this year at 7.5 percent.

Economy will slow

But economists warn this momentum will be difficult to sustain as the tumbling rupee, along with rising crude oil prices, takes a toll on growth. India, the world’s third largest oil importer, gets almost 80 percent of its fuel needs overseas.

“The government needs to mellow down on growth aspirations,” said N.R. Bhanumurthy, economist with the National Institute of Public Finance and Policy. “The growth needs to come down to a little less than 7 percent.”

Even as the government faces the prospect of a slowing economy, it is under pressure to lower taxes on gas and diesel to bring down the sharp rise in prices. Fuel is one of the most heavily taxed items in India, with rates as high as nearly 50 percent. Prices vary from state to state, but they have gone up by about 14 percent this year.

Hoping to cash in on the growing disaffection over the surge in fuel prices and the sliding rupee, opposition parties led nationwide protests that shutdown offices and schools in several cities this week.

India
Discontent with spiraling fuel prices poses a challenge to Prime Minister Modi’s Bharatiya Janata Party ahead of general elections next year. VOA

The government dismissed the protests, saying that although people faced momentary difficulties, they understood they were because of factors beyond its control.

Political analysts are not so sure, pointing out that fuel prices are a politically sensitive issue in India and usually result in a spike in inflation.

“Anger is rising, there is resentment,” said Satish Misra at the Observer Research Foundation, warning the ruling party will face a backlash “Obviously that is going to have a negative impact on the electoral fortunes of the Bharatiya Janata Party, there is no doubt about that.”

Warnings from economists

Among those who are upset with the high fuel prices is Rajesh Kumar, who commutes 30 kilometers to the advertising agency where he works. Hit by the higher prices that eat into his income, he has started sharing the ride with another employee.

India
Narendra Modi. Wikimedia Commons

“I have given up the idea of buying another car,” he said despondently. “I will not be able to afford the cost of running it.”

Economists however have warned the government against giving in to populist pressures ahead of a series of state polls later this year and general elections around April next year. They say lowering taxes on fuel or taking measures to prop up the currency will strain the country’s finances and hurt the economy in the long run.

Also Read: Diverse Gathering To Be Addressed This World BioFuel Day: PM Narendra Modi

“One needs to be more careful and vigilant,” Bhanumurthy said. “It is easy for India to stay with low growth than experiencing the high deficit.”

But there is also some good news for the Indian economy. The falling rupee has given a boost to some of India’s most lucrative exports, such as software services and pharmaceuticals, which add up to billions of dollars. (VOA)