Need new economic regulatory framework with citizen welfare as core objective: Experts

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Published: May 28, 2020 10:04 PM

The crisis has shown that the existing economic regulatory framework has outlived its purpose and has failed to create right incentives for businesses to practice inclusive and sustainable business models, it said.

economic regulatory framework, CUTS International, covid 19, indian economy, economic crisis, labour lawThe crisis has shown that the existing economic regulatory framework has outlived its purpose and has failed to create right incentives for businesses to practice inclusive and sustainable business models, it said.

The country needs a new economic regulatory framework with citizen welfare as core objective to align with the prime minister’s self-reliance call, experts said. Considering the adverse impact of the COVID-19 pandemic, a statement issued by research organisation CUTS International said that poverty is likely to double and 40 crore workers may sink into deeper poverty.

The statement included views of 54 eminent personalities, including former Cabinet Secretary K M Chandrasekhar, former Finance Secretary Arvind Mayaram, Biocon MD Kiran Mazumdar-Shaw and Manipal Global Education Services Chairman Mohandas Pai.

The crisis has shown that the existing economic regulatory framework has outlived its purpose and has failed to create right incentives for businesses to practice inclusive and sustainable business models, it said.

The regulation making process is captured by only a few, with voices of micro and small businesses, workers, and citizens, remaining unheard, who bear disproportionate burden of such regulatory frameworks, the statement said.

“The charter is addressed as an appeal to the prime minister and chief ministers of all states and union territories of India, as we believe the central and state governments will need to work together, along with other stakeholders, to reduce the mistrust between citizens, workers, farmers, businesses, and government, and usher a new era of economic democracy,” it said.

Lack of ‘whole of a government’ systems approach has led to inconsistent interpretation and implementation, resulting in inadequate safety and security for human capital, and mistrust between citizens, workers, businesses, and government, it said.

Few of the states have announced labour law reforms recently, by executive orders, to attract investment, it said.
This may not necessarily enable smoother business operations, and it will increase the trust deficit, which can be counter-productive, it added.

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