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Indian Express Explained 30/05/2020 | TEMS IAS

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1) EDITORIAL : INDUSTRIAL DISPUTES ACT

We all have seen the Migrant crisis in the Times of Covid-19. Lets discuss about Industrial Disputes act and some Problematic Provisions.

  1. Industrial Dispute Act– This act was enacted to shape the relationship between employer and employee. However, it has created many roadblocks in removing the trust-deficit between two.
  2. Problematic Provisions  under Section v of Act

Implications of these provisions

  1.  Discourage entreprenuership– The thresholds placed on employers discourage them to expand their units and business. This directly affects one of the most crictial element of factor of production that is entrepreneurship.
  2. Promote Informal and dwarf industries– Firms, in order to stay away from bureacratic hussles, employ less than 20 employees and remain dwarf in size. This in turn affects their economies of scale, overall production and profit.
  3. Lack of skilling in employees– These provisions also discourages the employers to provide better skills to their employees. Since investment in skilling leads to employ worker for longer period but also necessitates payment of severance pay which add to cost of production for employer.

Way Forward – For promoting economies of scale and do away with dwarf industries, removal of thresholds under Industrial Dispute is the need of the hour. COVID crises provide us the opportunity to learn lessons and act for welfare of have-nots of the society.

2)Explained: What deceleration in GDP growth rate tells us about state of Indian economy:-

What has happened:- Ministry of Statistics and Programme Implementation (MoSPI) released the data for the fourth quarter (January to March) of the last financial year (2019-20) as well as the provisional estimates of the full-year GDP growth rate.

This is the lowest annual growth rate of GDP registered under the new GDP data series which uses 2011-12 as the base year.

Why the Decelerating Growth Rate Matters :-

A sharp divergence in nominal GDP growth rate basically upsets all other calculations in the economy. For instance, a sharp fall means the government does not get the revenues it had hoped for and, as such, it can’t spend as much as it wanted to.

Secondly, the substantial deceleration in nominal GDP growth reflects poorly on the government’s fiscal marksmanship. In other words, it shows that the government was not able to assess the magnitude of economic growth deceleration that was underway.

Another key takeaway from the provisional GDP estimates is the undesirable emerging structure of the Indian economy:-

If India was to create lots of well-paying jobs that allow it to reap the so-called demographic dividend then it had to be via manufacturing growth.

But 2019 paints a dismal picture in this regard, While the agriculture and allied sectors enjoyed buoyant growth, as the year progressed, manufacturing simply lost its way — contracting for three of the four quarters.

3) National Guard?:- Comprising the Army National Guard and Air National Guard, it is a reserve component of the US Army and provides trained units to states, territories and the District of Columbia to protect life and property. The force supports combat missions, domestic emergencies, humanitarian efforts and homeland security operations among others.

The organisation of the National Guard dates back to 1636, when on December 13 the first militia regiments in North America were organised in Massachusetts.

The forces can be mobilised by the President whenever more units are needed to maintain national security. However, no change can be made in the branch, unit or allotment of a unit located within a state without the approval of its governor.

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