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Indian trade unions push back on government's labor law plans

Angry workers plan January general strike over move 'taking away' their rights

Indian labor unions are calling on workers to protest the government's planned streamlining of labor laws in a general strike set for next January.   © Reuters

NEW DELHI -- As the slowing Indian economy hits the job market hard, major trade unions have announced a series of industrial actions over the next three months, culminating in a general strike on Jan. 8 next year, to protest what they call the anti-labor policies of Prime Minister Narendra Modi's government.

Among the actions scheduled is one on Oct. 22, when all banks will shut, according to an Indian union leader. Labor organizations say their protests are aimed at countering the government's effort to streamline the country's labor laws.

The government is working to combine India's tangle of labor laws into four broad codes dealing with wages, industrial relations, social security, and health and working conditions. The code on wages was recently passed by parliament. Labor leaders say the proposed changes favor employers and curtail trade union rights.

India's economy is suffering from slowing growth and job creation. Gross domestic product expanded by 5% in the April to June quarter, a six-year low, and official data released in May showed unemployment at a 45-year high. According to the statistics ministry, industrial production contracted 1.1% on the year in August, led by sharp falls in capital goods and consumer durables.

The slowdown comes as sectors ranging from consumer finance, to autos, to real estate face distress. The auto sector alone has reported cutting about 350,000 jobs in recent months, as showrooms close and manufacturers slash passenger car production.

The government has announced a slew of measures to revive growth, including a cut in corporate taxes for domestic companies and the scrapping of a duty increase on foreign equity investors.

But the government's critics in the labor movement are unimpressed. "In the name of [fighting] the recession, the central government is taking steps, such as reducing corporate taxes, and giving them a big bonanza to the tune of 1.45 [trillion rupees] ($20 billion) from the national exchequer, while not a single penny is spent to ensure job security or employment allowances to the workers," said a statement released by 10 Indian trade unions at their national convention in New Delhi in late September. "The government measures are supply-side, when all the economists are unanimous that the crisis is on the demand-side," the groups said.

Tapan Kumar Sen, general secretary of the Centre of Indian Trade Unions, one of the 10 organizations that called for the Jan. 8 strike, told the Nikkei Asian Review that more than 200 million workers from across sectors and from all over the country are expected to take part.

After Modi's Bharatiya Janata Party returned to power in May following a general election, there has been "a series of actions or strikes by the workers in different industrial sectors, such as iron ore mines, coal mines, the banking sector, the railway sector, defense production," said Sen, who is also a leader in the Communist Party of India (Marxist).

Among the unions' demands are pensions for all workers, price controls on essential commodities and job-creation programs. The convention declared "its strong denunciation of the communal forces which are cultivating an atmosphere of conflict within the society on nonissues, giving an opportunity to the government to deflect the attention of the masses from the core issues of unemployment, runaway price rises, etc."

The unions accuse the Modi government of failing to respond to the genuine demands of working people, and continuing "its brazen aggression against the rights of workers, in the interest of their corporate masters."

"Labor laws are being sought to be overhauled in favor of the employer class," the convention statement said, in reference to a legal streamlining effort that is expected to affect around about half a billion workers across the country.

India has around 40 central government laws governing labor issues and over 100 state-level laws that were enacted four to eight decades ago. The State Bank of India said in a report that the regulations are "archaic and do not address the concerns of a globalized economy like India."

Labor and Employment Minister Santosh Kumar Gangwar calls the code on wages "a historic bill," adding that it will ensure statutory protection for minimum wages and timely payment of wages to about 500 million Indian workers.

The trade unions, however, say the codes will enable employers to use a hire-and-fire policy to extract concessions from workers.

The entire program of changes to the country's labor law, along with joblessness brought on by the weakening economy, encouraged the unions to launch the anti-government protests, Sen said.

"Actually, all the four codes are aimed at taking away trade union rights [and] changing the whole composition of employment toward a more temporary and casual nature of work," he said. "The right of the workers to protest will be taken away, [and] recognition of the unions will be subjected to whims of the employer class."

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