Labor Relations in the New Economic Environment

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Labour Relations in the New Economic Environment
N R Sheth
The union government's progressively unfolding package of objectives, intentions and action plans promoted under the title new economic policy (NEP) is obviously guided by a critical and urgent national need. India should expeditiously get out of its grave economic crisis in the international and internal contexts and strive to maintain and enhance its position as a member of the global economic community. I believe, this national need, along with the urgency ascribed to it by government, should be shared by all Indians for whom an honourable collective existence is an essential national objective. I also believe that a democratic nation like India cannot meaningfully aspire to exist and grow with-pride in the international community unless it offers all citizens an opportunity to lead a life with honour and dignity. This paper on the role of employers, labour and trade unions in the emerging Indian economic scenario is offered with the hope that it will invite all concerned parties (government, industry and trade unions) to reflect specially on their share of responsibility in moving towards the central mission of NEP.

The process of rationalization and liberalization dominating the government's new economic policy (NEP) is an inevitable part of India's need to exist and grow with dignity in the emerging global economy. While this implies freedom and flexibility for industry, this has also led to incidence of labour redundancy, unemployment and casualization. With the government committed to full employment in the current five-year plan and the trade unions bearing a crucial social responsibility to protect workers' interests, the industrial relations issues involved in NEP need to be resolved amicably. This paper by N R Sheth examines these issues in detail and discusses the need for a meaningful dialogue among the various concerned parties in an atmosphere of mutual trust. N R Sheth is Honorary Senior Fellow at the Gujarat Institute of Development Research, Gota, Ahmedabad.

Main Elements of NEP
The main contents of NEP have been stated, reiterated, explained and interpreted on numerous occasions since mid-1991 by leading members of the political and bureaucratic wings of government. The crucial elements of the new policy can be recounted as follows : • The country should strive to achieve a favourable balance of payments in its trade with the external world. For this purpose, the economy should ac cord high priority to growth in exports and restraint in imports. Strict economic discipline should be enforced to reduce India's dependence on external and internal borrowing. Accordingly, the government at all levels should minimize the fearsome burden of revenue deficits in the management of economy. 3



Vol.18, No.3, July-September 1993



One of the most important prerequisites for achievement of the objectives of export promotion and economic self-dependence is to facilitate production of goods and services with the utmost concern for high productivity and quality to ensure acceptability and competitiveness of Indian products in the global markets. Towards this end, economic enterprise in all sectors should be al lowed and encouraged to function and grow in a healthy competitive environment. Hence, govern ment control and regulation of industry should be reduced to the minimum necessary for an orderly and effective functioning of the economy. The ultimate aim of the economic policy is to op timize the well- being and happiness of citizens. Hence, people involved at all levels in economic enterprise should be adequately educated and trained to participate in its management. The human constituents of an enterprise should be in formed about the content and context of NEP. Human resource development should, in the long run, cover health, education, efficiency and a general improvement in standard of living and quality of life.

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