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Andhra for Andhraites ... PDF Print E-mail
Wednesday, 24 July 2019 05:29
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Will spur similar demands in other states, a bad idea

 

Andhra Pradesh chief minister Jagan Reddy has dealt a big blow to the idea of a pan-Indian market for all goods and services—and for people migrating from one state to another in search of jobs—by passing a legislation that says 75% of all jobs, including in the private sector, have to be reserved for local youth; factories have three years to comply and, if adequately skilled people are not available, firms will have to train local people with the required skills. Some other states have similar stipulations, but that is for industries that are set up after availing of financial incentives from the state government.

While it is early days yet, what is worrying is that some other states are also looking at laws similar to what Andhra Pradesh has just passed. Soon after he was sworn in, Madhya Pradesh chief minister Kamal Nath also suggested a law reserving the bulk of jobs for the local population. Apart from what this will do to states like Uttar Pradesh and Bihar that have a very large number of people migrating in search of jobs, what is more worrying is the potential spillover to other areas. In the power sector, for example, several state chief ministers are reluctant to let electricity be ‘exported’ to other states by units that are located within their boundaries—not allowing this ‘export’ lowers domestic prices—and moves such as the Andhra-for-Andhraites will only spur similar moves by other states. Indeed, last year, both Andhra Pradesh’s then chief minister Chandrababu Naidu and Karnataka’s then chief minister Siddaramaiah raised the issue of southern states subsidising the northern ones by contributing more to the central tax kitty.

 

 

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