Lok Sabha Question No. 503 (STARRED), answered on 2017-04-10
Subject: Impact of Global Slowdown on Labour and Industry
Ministry: LABOUR AND EMPLOYMENT
Asked by: HARI NARAYAN RAJBHAR

## GOVERNMENT OF INDIA MINISTRY OF LABOUR AND EMPLOYMENT

## LOK SABHA

## STARRED QUESTION NO. 503 TO BE ANSWERED ON 10.04.2017

IMPACT OF GLOBAL SLOWDOWN ON LABOUR AND INDUSTRY

†*503. SHRI HARINARAYAN RAJBHAR:

Will  the  Minister  of  LABOUR  AND  EMPLOYMENT  be  pleased  to state:

- (a)whether the Government has conducted any comprehensive study of the impact of global financial slowdown on domestic labour and industry;
- (b)if so, the details and the findings thereof;
- (c)the  number  of  labourers  who  reportedly  lost  their  jobs  due  to closure  of  various  industries  in  the  country  during  the  last  three years and the current year, State/UT-wise including Uttar Pradesh; and
- (d)the role played by the Government in rehabilitation of the affected labourers during the said period?

## ANSWER

MINISTER OF STATE (IC) FOR LABOUR AND EMPLOYMENT (SHRI BANDARU DATTATREYA)

- (a) to (d): A statement is laid on the Table of the House.

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STATEMENT REFERRED TO IN REPLY TO PARTS (a)  TO  (d)  OF  LOK SABHA  STARRED  QUESTION  NO.  503  FOR  10.04.2017  BY  SHRI HARINARAYAN RAJBHAR REGARDING IMPACT OF GLOBAL SLOWDOWN ON LABOUR AND INDUSTRY.

(a) & (b):  V.V. Giri National Labour Institute, an autonomous institution of the Ministry of Labour & Employment had conducted a study based on a request of the Ministry of Commerce  and  Industry  on  Global  Downturn  and  Export  Sector  in  India:  Impact  on Production, Export and Employment during 2009-2010. The main objective of the study was  to  assess  the  impact  of  the  economic  slowdown  on  exports,  production  and employment  in  three  specific  export  intensive  sector,  namely  textiles,  diamond  and handicrafts.    The  study  also  evaluated  the  efficacy  and  efficiency  of  the  stimulus packages  initiated  by  the  Government  of  India  to  counter  the  slowdown  and  ensure recovery.

The study indicated that after the economic slowdown of about a year and a half, the recovery of the Indian economy was evident from May-June 2009. The details and key findings of the study are at Annexure-I. (c) :The details are placed as Annexure-II . (d): Under the Industrial Dispute Act, 1947 in the event of closure, every worker affected is  entitled  U/S  25-O  (8),  compensation  equivalent  to  15  days  average  pay  for  every completed year of continuous services. In addition under Rajiv Gandhi Shramik Kalyan Yojna worker is paid Unemployment Allowance and vocational training is provided for skill development.

## ANNEXURE REFERRED TO IN REPLY TO LOK SABHA STARRED QUESTION NO. 503 FOR  ANSWER  ON  10.04.2017  REGARDING  'IMPACT  OF  GLOBAL  SLOWDOWN  ON LABOUR AND INDUSTRY.

## Key findings

The main objective of the study was to assess the impact of the economic slowdown (2007-2009)on  exports,  production  and  employment  in  three  specific  export  intensive sectors, namely textiles, diamond and handicrafts. The study also evaluated the efficacy and efficiency of the stimulus packages initiated by the government of India to counter the slowdown and ensure recovery.  The study suggested policy measures and an action plan to boost output, exports and employment in the context of economic slowdown in the three referred sectors. The study was based on macro and micro level information and generated employment coefficient with respect to exports.

The study noted that the global slowdown during 2007-2009 had an adverse impact on export  growth  in  the  textile,  diamond  and  handicraft  industries.  This  resulted  in  the decline  of  employment  potential  of  these  labour  intensive  sectors.  However,  it  is important to note that there was a difference in terms of formal and informal sectors as far  as  the  impact  of  employment  is  concerned.    While  the  employment  levels  in  the formal sector enterprises remained more or less the same during the crisis period, the fall in employment took place primarily in the informal sector or small enterprises.

Based on the detailed sectoral as well as sub-sectoral analysis, the study recommended that stimulus packages introduced to revive the export industry like interest subvention, cut in excise duty, etc. will have to be continued for at least two fiscal years to revive the exports and economic growth.

The study highlighted policy issues at two levels: Cross-cutting structural  issues of a medium- to long-term nature; and Sector-specific issues of immediate concern flowing primarily from the present study.

The  Cross-cutting  issues  include:  Need  for  diversification  of  exports;  Continued  skill development  of  workers;  Simplification  of  the  duty  draw  back  and  incentives  claim procedure;  Investment  in  infrastructure;  and  Measures  to  formalise  the  informal employment.

## ANNEXURE REFERRED TO IN REPLY TO LOK SABHA STARRED QUESTION NO. 503 FOR ANSWER ON 10.04.2017

## REGARDING 'IMPACT OF GLOBAL SLOWDOWN ON LABOUR AND INDUSTRY

## State & Industry-wise Closure of Units & Workers affected thereby

## Central Sphere

| Year           | No of Units   | Workers Affected   |
|----------------|---------------|--------------------|
| 2014-15        | Nil           | Nil                |
| 2015-16        | 2015-16       | 2015-16            |
| State/UT       | No of Units   | Workers Affected   |
| Chhattisgarh   | 1             | 153                |
| 2016-17        | 2016-17       | 2016-17            |
| State/UT       | No of Units   | Workers Affected   |
| West Bengal    | 3             | 61                 |
| Jammu &Kashmir | 1             | 30                 |
| Haryana        | 1             |                    |
| Punjab         | 1             | 823                |
| Andhra Pradesh | 2             |                    |
| Karnataka      | 1             | 72                 |
| Kerala         | 1             | 44                 |
| Madhya Pradesh | 1             | 862                |
| Chhattisgarh   | 1             | 11                 |
| Uttrakhand     | 1             | 165                |
| Total          | 13            | 2068               |

State Sphere

| Year 2014        | Year 2014       | Year 2014                  |
|------------------|-----------------|----------------------------|
| State/UT         | Number of Units | Number of Workers Affected |
| Andhra Pradesh   | 3               | 326                        |
| Chandigarh       | 1               | 8                          |
| Haryana          | 2               | 59                         |
| Himachal Pradesh | 2               | 70                         |
| Karnataka        | 5               | 552                        |
| Telangana        | 2               | 2745                       |
| Tripura          | 16              | 396                        |
| Uttarakhand      | 2               | 123                        |
| Total            | 33              | 4279                       |

| Year 2015 (Provisional)   | Year 2015 (Provisional)   | Year 2015 (Provisional)    |
|---------------------------|---------------------------|----------------------------|
| State/UT                  | Number of Units           | Number of Workers Affected |
| Andhra Pradesh            | 1                         | 260                        |
| Chhattisgarh              |                           |                            |
| Goa                       | 2                         | 44                         |
| Himachal Pradesh          | 1                         | 90                         |
| Karnataka                 | 1                         | 96                         |
| Tripura                   | 9                         | 687                        |
| Total                     | 14                        | 1177                       |

| Year 2016 (Provisional)   | Year 2016 (Provisional)   | Year 2016 (Provisional)    |
|---------------------------|---------------------------|----------------------------|
| State/UT                  | Number of Units           | Number of Workers Affected |
| Tripura                   | 14                        | 566                        |

Note: 1.The statement in respect of State Sphere is based on the returns/information received in the Labour Bureau from   respective State Government. The information w.r.t the Central Sphere is based on the information available in the Ministry of labour & Employment.

2. No information w.r.t Uttar Pradesh has been reported in the Labour Bureau.

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