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Change labour/factory laws, set up public funded equity funds to assist SMEs: NMCC

New Delhi, May 22 (KNN) The National Manufacturing Competitiveness Council (NMCC) has asked the new government to do away with several labour and factory laws which are an obstacle to progress in manufacturing; and also set up public funded equity funds to help SMEs that suffer from credit crunch.

NMCC has recommended that the government “prune close to 44 Labour and Factory Laws that have been in existence in the Statute for so long to just three to enable industry, especially in its mid and small segment to escape uncalled for bureaucratic intervention in their day-to-day operations; so that their manufacturing progresses smoothly and is saved from little hindrances that often arise from inspector’s peeps,” according to Member Secretary, NMCC, Ajay Shankar.

Shankar was addressing a seminar on “Enhancing the Indian Manufacturing Competitiveness” organized by the PHD Chamber of Commerce and Industry here today.

He also said that the NMCC would propose to the new government to set up public funded equity funds to extend and release financial assistance to industry in its mid and smaller segments since such industries suffer from credit from public and financial institutions.

With regard to the council’s recommendation of reducing labour/factory laws from 44 to 3,  “The new government should be able to condense the new labour laws into three categories that will address the labour concerns relating to their safety and security, their legitimate rights to work and provide them welfare, pointed out Shankar.

The new labour laws should facilitate foreign investors to park their surpluses in India with an atmosphere of putting up manufacturing facilities in which the role of government is bare minimum, he stressed. 

On the issue of public funded Equity Fund, he was of the view that the council is toying with this idea and it would soon propose to the new government to put up such funds to accelerate manufacturing, especially in the medium and small scale industries to grant them financial assistance since manufacturing initially does not provide for higher returns and the banks and financial institutions are reluctant to release liquidity to this category of industry. 

The new government in his opinion should be able to create an eco-system in which manufacturing is accelerated as in the absence of sound eco-system, the manufacturing has fallen to a negative zone in the last couple of years.

Offering his comments, Chairman, Industry Affairs Committee, PHD Chamber, Anil Khaitan said that until focused attention was paid to increasing India’s manufacturing by policy makers, it would be harder to obtained desired and intended targets.  

He however welcomed the idea of setting up public funded equity funds for financial assistance to small scale sector and appreciated the council’s move to minimize the number of labour statutes to govern the industry.