Report by the Secretariat: I. Economic Environment (2) Recent Economic Developments: Para. 7:
More than half of India's workforce still depend on the highly unproductive agricultural sector while the manufacturing sector employs only 22% of the (organized) labour. What is India's strategy to shift employment from agriculture into the more labour intensive industrial sector?
Reply: The share of the manufacturing sector in GDP has been stagnant at around 15% over the years and the sector is a low contributor to employment. The Government realises the importance of the sector in job creation, and is finalizing a policy with a view to raising the share of manufacturing in GDP to 25%. It aims to promote industries with the competence to leverage the growing opportunities at home and abroad.
Switzerland 2:
Report by the Secretariat: I. Economic Environment (2) Recent Economic Developments: Para. 11:
Taking into account "the relatively large segment of non organized (not formally employed) workers" in India, we wonder whether reforms in India's labor laws could facilitate the shift of India's workforce from the non organized to the organized sector. Is India currently assessing whether the shift from non organized workforce to the organized sector may be promoted by reforming its labor laws?
Reply: Stability in the relationship between employers and employees is important. Therefore, the endeavour of the government has been to bring about labour reforms by following a consensual approach and to maintain harmonious industrial relations through effective interventions of Central and State industrial relations machineries.
Switzerland 3:
Report by the Secretariat: I. Economic Environment: (3) Fiscal Policy: Para. 14:
Since improvements in infrastructure are required (Para. 5) and "since tax revenue continues to be insufficient to finance India's infrastructure and developmental needs" (Para. 14), we wonder whether India is going to adopt additional policy measures to improve the investment climate in order to attract more private infrastructure investments, including investments from abroad. What concrete policy measures is India going to adopt in order to attract additional private infrastructure investments, including foreign investments?
Reply: A roadmap on fiscal consolidation envisages prudential expenditure management through which the Government of India will generate resources to meet the development needs of various sectors. As part of expenditure correction, the Government has established a practice of extending subsidies in cash in order to bring down overall subsidy related liabilities. The public sector is vastly enhancing its use of the public private partnership (PPP) mode for project financing. This enables fiscal space for the provision of public goods in development sectors where such finance is unlikely to be forthcoming.
