Gujarat alone has 10 non-functional SEZs, proof that lax laws will not ensure prosperity
Gandhinagar: Many of the country’s states appear to be choosing industry over labour, in order to secure investment from domestic and international players, guided by a narrative in which lax labour laws translate into money pouring in.
If this were true, experts say, there would be no failed Free Trade Zones or Special Economic Zones (SEZ). So, going by 10 non-functional SEZs in Gujarat, this narrative is a false one. The Vijay Rupani-led state government last week relaxed labour laws with a view to attracting investment from multinational corporations (MNCs), especially those that are looking to leave China in the wake of the COVID-19 crisis.
Chief Minister Rupani had tweeted: “New investment in the state will be exempted from labours laws for 1,200 days of operations, excluding minimum wages, industrial safety act and compensation laws, all approvals in seven days.”
Labour unionists interpret this decision as follows: Work hours for employees will be fixed by the employer and will be more than eight hours; labourers cannot form associations and or demand any rights including leave; and with no protections in place, workers will be forced perform or perish.
“If they think that exempting industries from labour laws will attract more investment then they are living in a fool’s paradise,” said Kiran Desai, Director of the Centre of Social Studies. K Hemalatha, President of Centre for Indian Trade Union (CITU) agrees.
“If that was the case, no SEZ in our nation would have failed, because there were no labour laws in place there,” she said. The SEZ concept was first introduced in the nation in the late 1990s but took decades to take off. Even today, no Indian SEZ can compare in size to China’s Shenzhen SEZ- -which is spread over 2,000 sq km and was launched way back in 1978. The state government passed its own Gujarat Special Economic Zone Act in 2005. Since then, 47 have been set up here, 10 of which are non-functional.
The much-touted Dholera Special Investment Region (DSIR)--part of the Delhi Mumbai Integrated Corridor--is still struggling to find investment, despite being launched in 2009.
Two years ago, the state assigned the Gujarat Industries Development Corporation the task of attracting MSME in the Dholera SIR. Earlier, there had been talks of targeting Rs40,000 crore, to be spread over 423 sq. km. In the past 39 years up until June 2019, Rs 8.96 crore worth of investment was done in about 11,000 large projects that hired 21,88,105 people.
These focused on 12 sectors. Other projects numbered 16,350, with investments amounting to Rs10,56,726 crore, and employment to 31,07,038 people.