Will overcome difficulties to tame inflation,says PM

He said there are difficulties to check the price rise,but the government “shall overcome” them.

Despite some moderation,food inflation is still in double digits,with the index hovering at 10.30 per cent for the week ended November 6. The general rate of price rise,covering almost all the commodities,was 8.58 per cent in October,which is much above the comfort level of 4-5 per cent. The Reserve Bank of India has been following tight monetary policy to anchor inflationary expectations.

Meanwhile,acknowledging that some labour laws have not had the intended results on the ground,Singh hinted at the need to revisit some of them,which have over the years possibly contributed to “rigidities” in the labour market,adversely impacting growth of employment on a large scale.

The Prime Minister pointed out that though the government was committed to “economic reform with a human face”,devoting more resources for social welfare activities depends crucially on the pace of the economic growth.

“We need therefore a sustained growth of 9-10 per cent per annum to make a serious dent on poverty,unemployment and under-development,” he said. Though he did not specifically talk about labour reforms — a phrase which has in the past raised the hackles of Left-backed trade unions — the Prime Minister gave ample indication that he believes some labour laws need to be revisited.

“…We have enacted several progressive labour laws since Independence and some even before that. But it appears that not all these laws have had the intended good effects that we would like to see on the ground,” he said.

He said one needs to look into whether the “best intentions” for labour are not actually met by laws that sound progressive on paper but end up hurting the very workers they are meant to protect. “If we want to draw more and more workers into the organised sector where they can claim the benefits that currently cover such a very small proportion of our labour force,do we need to rethink the nature of the laws that enforce such benefits?” he asked.

Singh pointed out that both the industry and labour must “work together” to remove the barriers for faster economic growth and faster growth of employment. While the regulatory framework in the labour sector should encourage investment in labour intensive industries,it should also protect the interests of the workers,he pointed out.

“Simultaneously,it should make our industry more competitive by enhancing productivity. It is also important that the gains of enhanced productivity are equitably shared among shareholders,workers and consumers at large,” he said.