Skip to main content

How World Bank ignored "positive side" of regulations on labour, environment, land

Counterview Desk
Well-known Delhi-based advocacy group, Financial Accountability Network India, in a just-released compendium during the on-going general elections, “5 Years of Achhe Din: A Quick Look at Banking and Finance Sector”, has sought to analyze on different aspects of finance, banking and the economy. Prepared by well-known experts, including Dinesh Abrol, Rohit Azad, and Sucheta Dalal, the analysis is claimed to have been carried for triggering an “informed discussion” on the economic performance of the NDA-II government.
One of the chapters in the 29-page booklet is a critique of how India recently increased its ranking in Ease of Doing Business (EODB). The index rose from 142 in 2014 to 77 in 2018. This was claimed to be a success, and seen as an improved business environment and increased investment in the country, contributing to over-all development. This was also an index to measure how easy it is to conduct private business in the country.

Excerpts from the critique:

EODB straightjackets reforms into a uniform prescription across countries, without looking at regional and country specific issues and gives a ‘one size fit all’ idea. EODB according to World Bank’s own legal unit has a bias towards deregulation and considers regulations are bad for business. It ignores the positive side of regulations on labour, environment, land etc.
Labour unions and environmental groups have critisized the report for its bias for deregulation of labour laws and environmental laws. Paul Romer, the chief economist of the World Bank, resigned after raising issues of political bias of these ranking in the context of Chile. The ranking fell when socialist government came into power which contributed to the fall of the government in the next election.
India was earlier challenging the EODB ranking as data was collected from only one city, i.e. Mumbai, to determine the ease of doing business of the entire country. This resulted in the formation of an Independent committee on EODB. The committee suggested doing away with the ranking and also renaming the report to understanding regulations as business climate is not being dealt here in the report.
India, to attain a higher ranking has made about 10,000 both small and big, as reported by the Prime Minister. These include the most regressive reforms including moving towards a self-regulation and self- certification mode in many inspections earlier done by labour and fire departments. Immediate fallout could be seen in terms of rising incidents of fire in factories and restaurants resulting in deaths due to non-compliance.
The EODB change involves labour sector reforms. The reform will see the repealing of 38 of the existing labour laws, and replace them with four new labour codes. These are the Industrial Relations Code (replacing three labour laws), the Code on Wages (replacing four labour laws), the Code on Social Security (replacing 15 laws) and the Code on Occupational Safety and Health and Working conditions (replacing 16 laws).
The attempt is to make the laws employer friendly and easier for business and corporates to hire and fire workers. These reforms will also bring make trade unions and collective bargaining harder and will leave smaller enterprises with less than 300 workers outside the control of most labour laws.
Industrial Policy
India is trying to bring a new industrial policy which is business friendly but is not successful yet as there are major disagreements on the contours of the policy. Land, labour and environmental policies are the major impediments for a business friendly country. After the labour laws, much of the environmental clearances and laws are being diluted / by passed for business.
The Centre has exempted industries like steel, cement and metal from mandatory prior environment clearance for setting up a new or expanding the existing captive power plant employing waste heat recovery boilers (WHRB) without using any auxiliary fuel.
Environment ministry gave up its power to grant environmental clearances for mega-construction projects like malls, offices, residential apartments, and gave it to local municipal bodies — institutions with no scientific expertise or resources to carry out prior assessment of the adverse environmental impact likely to be caused by large projects.
Various ‘reforms’ on ease of construction index led to watering down of regulations such as Environment Impact Assessment (EIA) for construction. Earlier, large-scale construction projects with a built up area of 20,000 square metres and above needed permission from two state-level expert committees: the State Expert Appraisal Committee and State Environment Impact Assessment Authority (both committees were setup by the environment ministry).
Small-scale projects did not require such elaborate clearances from the environment ministry. Under the new regime, builders could get both the building plan approvals and environment clearances for their large-scale construction projects approved from their respective local municipal corporations, which were expected to set up their own environmental cells. This was later stuck down by the National Green Tribunal.
The Ministry of Environment, Forest and Climate change has also brought a new draft Coastal Regulation zone notification, which weakened the existing regulations and opened the coast lines for real estate, ports, and tourism.
Regional empowered committees at sub national level have been delegated higher powers to dispose of proposals for Forest Clearance involving diversion of 5 to 40 hectares of forest land and all proposals involving diversion of forestland for linear projects irrespective of area of forest land involved.
India’s apex National Board for Wildlife (NBWL), charged with allowing forest land in Protected Areas to be diverted for industry, cleared 682 of the 687 projects (99.82%) that came up for scrutiny.
The Forest Advisory Committee (FAC) of the Union environment ministry has granted preliminary forest clearance to the Parsa opencast coal mine, in one of the largest contiguous stretches of very dense forest in central India called Hasdeo Arand that spans 170,000 ha (hectares). Of this, 841.538 ha of biodiversity-rich forest land, about the size of 800 football fields, has been cleared for mining to be operated by Adani.
Meanwhile, India has reduced its corporate tax from 30% to 25% and put emphasis on indirect taxes through a GST regime. The insolvency code and associated reforms are part of EODB ease of doing business as it helps the ease at which one can start business and exit business. The insolvency regimes help business to move one once the business goes bad.

Comments

TRENDING

Buddhist shrines were 'massively destroyed' by Brahmanical rulers: Historian DN Jha

Nalanda mahavihara By Our Representative Prominent historian DN Jha, an expert in India's ancient and medieval past, in his new book , "Against the Grain: Notes on Identity, Intolerance and History", in a sharp critique of "Hindutva ideologues", who look at the ancient period of Indian history as "a golden age marked by social harmony, devoid of any religious violence", has said, "Demolition and desecration of rival religious establishments, and the appropriation of their idols, was not uncommon in India before the advent of Islam".

Examples of support to Hindu temples, scriptures, saints by 'Muslim' rulers galore

Siya Ram coin issued by Akbar By Bharat Dogra* At a time when the country as well as the world are passing through very difficult times leading to more urgent need for strengthening national unity for meeting several big challenges ahead, unfortunately disputes relating to religious places have been allowed to raise their ugly head once again. It is well-realized by now by many people that it is not historical facts but narrow considerations of political gain and spreading of fanatic ideas of intolerance which are behind such mischief, but due to the increasing threat of mob violence and patronage available at higher levels to groups spreading intolerance many people are reluctant to openly and fearlessly express their views. Hence there is urgent need for broad-based peace committees with wider social support to spread the message of communal harmony and to appeal against the dangers of spreading false messages regarding places of worship which can ultimate

Gyanvapi case: Use of 'illegal' lawfare to keep the communal pot simmering

By Venkatesh Narayanan, Bobby Ramakant, Manoj Sarang* With a steady drumbeat of bad news for the lives of ordinary citizens --  inflation at a multi-year high , rupee at an all-time low , negative job creation and when all forward indicators as seen by industry leaders point to recessionary clouds on the horizon , what’s a serially-incompetent government to do?  Dust out their time-tested-citizen-distraction playbook. The Gyanvapi-Masjid case is all of this -- as a weapon of mass distraction. This zeitgeist of our times is best captured by a recent opinion piece : "The idea is to keep the pot on a perpetual boil, simmering at the top, whirling feverishly beneath. A restless society forever living precariously on the precipice arouses distrst, uneasiness, fear and discomfort, That is a toxic panoply for manufacturing rage, which can then be effortlessly mobilized at short notice. BJP is creating an eco-system of real-time instant delivery of hate-mongers. That is how we are sudde

Targeting mosques, churches: 'Roadmap' for 2025, RSS' centenary year?

416 years old Our Lady of Health Church, Sancoale, Goa  By Fr Cedric Prakash SJ*  Fascists use manipulative strategies aimed at whipping up sympathy and support from the majority community, to which they normally ‘belong’. They do so in a variety of insidious and subtle ways. In the past few months, they have gone overboard in their efforts to denigrate and demonize minorities in India, particularly Muslims and Christians. They have spewed hate and divisiveness through their venomous speeches; incited people to violence and have effectively used officialdom to further their vested interests. The results are there for all to see: greater polarisation of the majority community in a country which prided itself for its pluralism and diversity. Their meticulously planned agenda is in order to gain absolute power of the country in the 2024 national elections. More so it is also a roadmap towards 2025 when the Rashtriya Swayamsevak Sangh (RSS) will complete one hundred years of its existence.

Upholding labour rights, Nehruvian scientific temper, Rajni Patel opposed Emergency

By Harsh Thakor*  Rajni Patel, who died 40 years ago, whatever his flaws, had one great quality: his human touch to offer selfless service and ability to galvanise or influence human beings from all walks of life. Few people would ever go out of the way to help someone or serve as selflessly without aim of personal gain. Rajni championed Nehruvian secular ideas and scientific temper. As a master in public relations he revealed utmost humility. As a barrister, he never appeared against the trade unions or workers. A Fabien Socialist he opposed liberal capitalism and radical socialism. Unlike most lawyers, he did not succumb to the lure of amassing wealth. Rajni was born in Sirsa, in Gujarat, on the very day Gandhi set foot on Indian soil, on 9th January, 1915. He gained his baptism through one of Gandhi's speeches calling for the boycott of foreign goods, which was the virtual turning point of his life. Rajni toed Gandhi to organise boycott of foreign goods. Rajni was able to cros

This varsity succumbed to extra-academic mobocracy, 'ignored' Hindutva archives

By Shamsul Islam* Open letter to Sharda University vice-chancellor Sub: Discarding a Question on Linkages of Hindutva with Nazism/Fascism is blatant Academic Dishonesty! Dear Professor Sibaram Khara Saheb, Namaskaar! According to your esteemed University’s portal: “The name of University, 'Sharda' is synonymous to 'Goddess of knowledge and learning-Saraswati'. She is identified with 'veena', an Indian musical instrument and the ‘lotus’, where she resides. The lotus in our logo symbolizes the seat of learning that the University is created for.  "Variety of colours signify the variety of disciplines the university offers and the overlap between petals creating new colours demonstrate the ethos of collaboration between students and teachers of different programme, nationality, creed and colour working towards creating new knowledge…the University's cherished mission to provide education beyond boundaries and to facilitate the students and faculty to achie

Whither climate goal? Increasing reliance on coal 'likely to worsen' India's power crisis

By Shankar Sharma*  Recent news articles, How to shock-proof India’s power sector and Power minister points finger at states for worsening electricity crisis , have highlighted a few current problems for the ongoing power sector issues as in April 2022. However, there is a lot more to it than a few temporary solutions as indicated in the articles. It should also be emphasised that it is techno-economically impossible to completely shock-proof a highly complex and geographically wide-spread vast power network, such as the one in India, which is only getting more and more complex with the passage of each year due to some irrational policies/ practices in the sector. A business-as-usual (BAU) scenario, wherein more and more of conventional technology power plants, including coal power plants, will be added in the near future, will also necessitate the increased complexity in the integrated national grid, and as a result the instances of power shortage/ disruptions can only escalate for

Swami Vivekananda's views on caste and sexuality were 'painfully' regressive

By Bhaskar Sur* Swami Vivekananda now belongs more to the modern Hindu mythology than reality. It makes a daunting job to discover the real human being who knew unemployment, humiliation of losing a teaching job for 'incompetence', longed in vain for the bliss of a happy conjugal life only to suffer the consequent frustration.

A former Modi ally, Prashant Kishor wanted to enter Congress 'on contract, as trader'

By Anand Sahay*  The Congress Party and the election campaigns specialist Prashant Kishor, whose company has done strategic communications for a host of political parties across ideology, should both count themselves lucky that they could not reach an agreement for Kishor to join the party. News reports suggest that the Congress rejected Kishor’s terms. This is not wholly unexpected. People join a party because they are attracted to it, and wish to serve it in any capacity that the party may see fit. But that isn’t Kishor at all. He gave the impression of entering into a contract, as a trader might. If news reports are to be believed, he sought freedom to report directly to party chief Sonia Gandhi, and sought untrammeled control over party communications. When such ideas did not find favour, the consultant withdrew. It is clear he has no particular love for the Congress, and its ideas, ideology and politics. In contrast, look at the key personae in G-23. They

Haven't done a good deed, inner soul is cursing me as sinner: Aurangzeb's last 'will'

Counterview Desk The Tomb of Aurangzeb, the last of the strong Mughal emperors, located in Khuldabad, Aurangabad district, Maharashtra, has this epitaph inscribed on it: "Az tila o nuqreh gar saazand gumbad aghniyaa! Bar mazaar e maa ghareebaan gumbad e gardun bas ast" (the rich may well construct domes of gold and silver on their graves. For the poor folks like me, the sky is enough to shelter my grave).