Modi 2.0 govt unlikely to unleash land reforms: EAC chairman Bibek Debroy

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May 31, 2019 8:48 PM

Debroy said those demanding for changes in land do not know the Constitution that well and reminded that there is the Seventh Schedule which defines allocation of functions between Union and the States.

As a solution, he suggested national income accounting experts from both the government as well as other bodies sit down to reach a consensus.

Bibek Debroy, the chairman of economic advisory council to the prime minister, Friday said Modi 2.0 government is unlikely to unleash land reforms, and will exclude industrial disputes in labour law changes. The National Sample Survey Office (NSSO) did not reveal jobs data due to Model Code of Conduct and will come out with the data soon, now that the elections are over, he told PTI here. He explained land is a subject of the states and reforms cannot be done by the Centre, adding that requests from the Chief Ministers had made the Narendra Modi Government introduce a land ordinance in its first term. It can be noted that Prime Minister Narendra Modi’s impressive poll victory had led many analysts to expect reforms on land and labour, the crucial factors of production which can propel the economy.

In the case of labour, the government will not touch the sensitive industrial relations side, which includes layoffs, retrenchment and closure, Debroy said. The focus of the newly sworn government’s labour reforms will be on the other aspects, including wages, safety and social security, he said. “We can reasonably expect a consolidated kind of draft bill for the other three, not so much industrial relations because that needs to be debated,” he said.

On the sensitive industrial relations, which is mentioned in the Sec 5 (b) of the Industrial Disputes Act, Debroy said every state will have its own way of reacting. Debroy said those demanding for changes in land do not know the Constitution that well and reminded that there is the Seventh Schedule which defines allocation of functions between Union and the States.

Meanwhile, on the jobs data front, Debroy said the NSSO has done a household survey and not the enterprise survey because of the high degree of the informal sector. “…the release was held up probably because of the Model Code of Conduct, now I am sure it will come out. In the absence of that, the entire debate on employment happened without any reliable data,” he said. There was a row over the jobs data, with two members of the National Statistical Commission, protesting against the non release of Annual Employment Survey 2017-18. Debroy said the last reliable data on jobs dates back to 2011-12. On the GDP front, Debroy said no one is contesting the nominal GDP and the issue is only with the assumptions used for the deflator which leads to different real GDP growth. He said this is due to difficulties computing tertiary services while calculating the GDP. As a solution, he suggested national income accounting experts from both the government as well as other bodies sit down to reach a consensus.

It can be noted that over 100 economists had publicly written against the GDP computing methodology in the run up to the election. On the controversial note ban, he said the demonetisation decision was an attempt to cleanse the system and “should never be viewed with a narrow economic cost benefit calculus”. The decision “goes beyond economics and is quasi- political” he said, adding that it “does not matter” what the commentators think about it because the voters have bought into the cleansing attempt.

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