But doing it is quite another matter. India only started seriously reforming its economy five years ago. Much deregulation has occurred, but untouched, so far, are the labyrinthine laws left over from the socialist era. These powerful unions in turn ensure that the rules to protect them stay in place. To the business community, it is a wheel of misfortune.
Few employers do.
The existing disincentives are daunting. Companies often have to wait as long as eight years for a court to settle labor disputes. Some employees have been able to hold up their dismissals in the judicial process for more than 20 years. To appreciate the scale of the problem in just the state sector, consider some astonishing numbers. Fully half of the 240 businesses are losing money.