Indian Economy News

Biggest reform in laws since 1947 to spur jobs, investment: Labour secy

India’s ongoing overhaul of its complex labour framework is expected to strengthen job creation and attract higher investment by reducing regulatory friction and modernising long-outdated statutes. The consolidation of 29 labour laws into four streamlined codes is designed to simplify compliance, introduce greater transparency, and leverage technology-driven processes. The reforms aim to balance flexibility for employers with strengthened protections for workers, including uniform minimum wages across genders and expanded social security coverage. By easing restrictions around workforce management and enabling more scalable business operations, the revised framework is positioned to support manufacturing expansion and improve the overall competitiveness of Indian enterprises in a shifting global supply chain environment.
The new provisions also extend formal protections to gig and platform workers, bringing them under a state-mandated social security system that includes disability, health, and accidental insurance benefits delivered through digital platforms. Provisions allowing longer shifts, night work for women, and relaxed thresholds for workforce adjustments are expected to create 7.70 million additional jobs and reduce unemployment by up to 1.30% over the medium term, according to SBI Research. While implementation remains the responsibility of individual states, extensive consultations have been conducted with labour unions and stakeholders to ensure a balanced rollout. The updated framework is set to be finalised and operationalised in the coming months, marking a significant structural shift towards a more adaptive, investment-friendly and inclusive labour ecosystem.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.