States may have separate labour laws

The Union government is considering a proposal to empower the states to frame separate labour laws in certain specific locations to attract investments, Union Commerce and Industries Minister Kamal Nath said on Friday.

"Labour is on the Concurrent list. But, we are considering empowering the states for framing separate laws on labour," he said, speaking at the 169th annual general meeting of the Madras Chamber of Commerce and Industry in Chennai.

The United Progressive Alliance government's labour policy is aimed at employment protection. But, the states would be encouraged to frame their own labour policies in certain locations such as the export zones to attract more investments, mainly foreign direct investment.  

"This will not be labour reforms. It will be newer labour laws," the minister said.

Kamal Nath, who was replying to a query on labour reforms in the context of the recent worker-related incidents at the Honda plant in Gurgaon, said the UPA government wanted the states to compete with each other to attract investments.

Tamil Nadu was emerging as the most sought after destination for FDI, he said, pointing out that the state attracted all recent FDI in the manufacturing sector.