Cabinet approves sops and incentives to boost manufacturing and exports in textile sector

50 MILLION NEW JOBS in 5 MONTHS ? It is reported that the Union Cabinet will soon approve a notification which will allow establishments covered by the Shops and Establishment Act to remain open round the clock ( 24 hours ) Currently , if they remain open for 10 / 12 hours , they end up inviting visits by Inspectors of Establishment Department and the Labour Department , to collect their weekly " haftas " With official sanction of 24 hours , that would go ! And 24 working hours will enable these shopkeepers to compete with those Foreign Companies bringing in 100 % FDI in retail but working for 8 hours / day ! And as soon as one Grocery store starts working longer hours ( even 12 hours ) , most of the neighborhood stores will follow suit ! For our 50 million MSMEs to, not only take on these Foreign Giants but to defeat them in competition , is only possible when we stop playing the RETAIL GAME by the Rules of those Foreign Countries , and make them clue-less with our own NEW and OUT-OF-BOX rules ! Possibly half of these may be covered by Factory Act and the remaining half by the Shop and Establishment Act Between them , they employ 90 % of India's work force of around 500 million Average of approx 9 persons per MSME Now , even if only 5 million ( out of 25 million shops ) just add ONE more employee to work longer hours , that would get jobs to 5 million youth ! That is quite a lot ! And without any additional Capital Investment ! Compare this advantage with Capital required to create ONE new job in Start Ups As per Government , Rs 10,000 cr of " Fund of Funds for Start Ups " , will catalyze an Equity Investment of Rs 60,000 cr , which , in turn will enable raising of Debt of Rs 120,000 cr - totaling Rs 180,000 cr of capital As per Government , that will generate 18,00,000 jobs ( in 5 years ) That is requirement of Rs 10 LAKH for each new job created in a Start Up ! While welcoming this initiative , I urge the Union Government to take following steps simultaneously , in order to generate , not just 5 million but 50 MILLION new jobs in the MSME sector ( and without additional funds ! ) : # Abolish all visits by Inspectors ( Labour + Shop & Establishment Departments ) # Allow MSMEs to engage Apprentices under the recently revised Skills Development Regulations / Apprentice Act # For them , remove the upper limit ( of Apprentices ) which is maximum of 10 % of employee strength # Let them engage Apprentices up to 100 % of their existing employees # Let them keep these trainees for 3 years under " Retail Establishment Trainee Scheme " # Let the stipend be 100 % ( instead of currently prescribed 60-70-80 % ) of semi Skilled Minimum wages ( Minimum Semi Skilled Wages are approx Rs 6,000 per month - so Shopkeeper need to pay Rs 6000 pm ) # Concerned State Governments to subsidize 50 % of this stipend (so, Shopkeeper's burden to be Rs 3,000 pm ) [ Stipend Subsidy does not violate WTO ! ] # To ensure fool-proof compliance with the number of Trainees engaged and Stipends paid , this Scheme ( 24 hr open + 100 % trainees + 100 % Stipend + 50 % Subsidy + 3 year training program + No inspectors ), will apply ONLY to those Shops which implement , mobile app MAD outlined in my following blog : -------------------------------------------------------------------------------------------------------------------------------- 01 June 2016 From BAD to MAD BAD = Biometric Attendance Device MAD = Mobile Attendance Device ------------------------------------------------------------------------------------------------------------------------------- Here is my idea of a technology that we need to create for a better India : Today Employee Attendance Systems in India work at three levels as follows : # Entirely Manual Attendance Register and Wage / Salary payment in cash or by Cheque # Partly Automated Punch cards or Bio-metric recording of attendance but manual calculation of wages / salaries and payment by cash or cheque # Fully Automated Bio-metric Attendance Devices ( BAD ) , integrated with a home-grown or bought-out , Salary Payment Software , running on a local Server. Salary payments could be by cheques or thru Electronic Transfer to concerned employee's bank account Once in a while , if a company has several establishments within a city , those local servers are connected to a Central Server , doing all processing In a rare case ( although , I am not aware of any ) , it may be that all the local servers of all the establishments of a company , all over the country , are networked with its central computer in its head-quarter Now imagine this : # All smart phones to evolve as Bio-metric Attendance Devices , with built-in Bio-metric Recorders , GPS , a mobile attendance App ( called MAD ? ) # App to have 2 buttons / icons ( Green = IN / Red = OUT ) # Employee to touch IN upon reaching his work-station and touch OUT , while leaving work place , at the end of work-shift . That's all ! # Being GPS enabled , buttons will get activated ONLY when the employee has reached the work place ( not while he is on his way ! ) # All 50 million establishments in India ( factories / offices / shops / clinics NGOs / Govt Depts ) to ensure that the MAD app is installed on the smart phone of each employee , when he joins # All of these smart phones to be connected ( IoT ? ) , with the Servers of , * Labour Ministries ( Central and States ) * HRD Ministry ( Central ) * Skills Development Ministry / NSDC * Finance Ministries ( Central + States ) * NITI Aayog * Income Tax Department * Any other server that you may want to # MAD app is integrated with a STANDARD / COMMON , software system for computing daily wages / monthly salaries of ALL the persons working in those 50 million establishments ( whether they are casual / contractual / trainee / apprentice / probationer / permanent / retained ) # As each person joins in any of these establishments , data re that person must be inputted by the Employer into the App , such as : * Name / Contact Details / DOB / Aadhar Card No / Employee Number ( Each unique Employee Number will be auto-generated by the common Salary Payment Software , running on IT Dept Server ) * Employee's Jandhan Yojana Bank Account Number for salary EC * Employer's Jandhan bank account / Unique Employer Number * Payment Mode ( Hourly / Daily / Monthly Rated ; wages / salaries ) * Leave provisions / PF rate / TDS rate / Allowances / Reimbursements * Any other relevant data ( either about employee of for employer ) WHAT ARE THE ADVANTAGES ? # For employees , no need to file a separate annual Income Tax Return # Direct deposit of PF / TDS amounts into bank accounts of Govt Depts # Direct Benefit Transfer ( DBT ) to every Employer for Stipend Subsidy , based on number of total trainees / apprentices employed # Total number of employees in India ( category / region / industry ) # Employment Density ( Industry wise / Region wise / Skill wise etc ) # Net Employment Growth Rate ( weekly - monthly / Industry-wise ) # Co-relation with no of persons graduating at various levels # Data about those Unemployed ( " Graduating " less " Employed " ) # Overtime Statistics ( Use / Abuse ) # Work-hour Analysis ( Ave hours / week - month ) # Wage / Salary Rates ( Rs per hour ) - Industry wise / Region wise ( of great interest to Foreign Investors looking to bring down manufacturing costs , by outsourcing to India / manufacturing in India ) # Compliance with labour laws / tax laws / Apprentice Act etc # Job Market Forecasts through BIG DATA ANALYTIC ( region / industry ) # Demographic Profiles of employees ( Rural to Urban migration ) # Per Capita Income Growth for persons using MAD app ( MOM / YOY ) # Changing composition between Blue Collar and White Collar employees Then there could be many other benefits not envisaged now Here is an opportunity for : * Manufacturers of Smart Phones To shrink stationary / bulky / common , bio-metric devices to mobile / small / personalized / hand-held devices { Remember ? If you don't make yourself obsolete , someone else will } * Tech Start Ups To come up with the Mobile App ( MAD ) / Technology Platform * NDA Government To implement what Shri Narendra Modiji said on 15 July 2015 : " If China is like a manufacturing factory of the World , India should become the human resource capital of the World . That should be our target and we should lay emphasis on that . We should have a futuristic vision and prepare plans for the next ten years " MAD could well be an important element of that " JAM ( Jandhan + Aadhar + Mobile ) PLAN " ! For once , please unshackle our entrepreneurs and enable them to unleash their innovations ! WE ARE FAST RUNNING OUT OF TIME ! -------------------------------------------------------------------------------------------------------------------------------- 23 June 2016 www.hemenparekh.in / blogs