75% Reservation Could Be The Last Nail In The Coffin For Jharkhand Government.

Jharkhand’s CM Hemant Soren has decided to bring 75% reservation for residents in private sector jobs. According to some experts, it is only an attempt to seek votes rather than bringing employment. Although, Mr Soren isn’t the first CM to pull such a stunt. Earlier, governments of Andhra Pradesh, Haryana and unofficially Maharasthra had also announced the same.

What Jharkhand Have That The Other States Don’t

Jharkhand is one of the richest mineral zones in the world and boasts of 40% and 29% of India’s mineral and coal reserves, respectively. Due to its large mineral reserves, mining and mineral extraction are the major industries in the state. Value of mineral production (excluding fuel minerals) during 2018-19 stood at Rs. 2,510.99 crore (US$ 356.22 million).

Any MNC would love to invest in a state like this that has this much potential.

Jharkhand’s Comparison with the other States

According to State Investment Potential Index 2018, who judged all 29 states released a report which declared Jharkhand the worst state for investment. Jharkhand has witnessed a decrease in overall ranking from 18 to 20. It falls behind in infrastructure and labour pillars.

Why Do Jharkhand Lag Behind

Jharkhand mostly lags in 6 factors: Land, Labour, Infrastructure, Economy, Governance and Political Stability, Perception.

Land: The land pillar as it stands, capture the availability, efficiency and policy space in the land across the state.
More land equals more industries.
In Jharkhand acquiring land is perhaps one of the most difficult processes, also involving litigation, According to new land acquisition laws 2013, the compensation is now increased to 4 times as well as the buyer must make sure about the social impacts. This brings us down to attract bigger projects that can generate employment.

Labour: For industry, the availability of an educated and skilled workforce at competitive wages in a favourable labour environment is a significant factor affecting the locational choice. While our workforce is not very much efficient, it also can’t match industry standards when it comes to adapt to new technologies.
Jharkhand also lacks in creating an environment for a competitive workforce, which decrease our chances of attracting big multinational companies.

Infrastructure: Infrastructure is a key factor in locational decisions. The availability of power, roads and credit is much needed for any business to grow, Where other states like Gujrat or Karnataka is continuously improving these factors, for the last 10 years we still couldn’t fix our biggest highway. we also lack facilities like water, bank branches per lakh population, cargo facilities at the airport and much-needed power supplies.

Economic Climate: Government policies, market demand and resource endowments are much-needed steps for a business-friendly environment. Alas, Jharkhand doesn’t provide any such environment. Whereas other states like Gujrat provide facilities like less paperwork, tax redemption, cheap and quality labour and a well-established infrastructure.

Governance and Political stability: Political stability is crucial in a state for businesses to thrive. Jharkhand hasn’t formed a stable government since it’s independence from Bihar except for the 2014-2019 term. Apart from that our ministers have been on the top list of corruption(The Coal Scam), this destroyed our reputation among businessman, thus they are not sure about investing in a state where the crime rate is high, police strength is not enough.

Perception: If you are not good enough in the above factors, that we are not definitely, it creates a perception in the mindset of Multinationals companies and somehow maligns your image and will not let you grow as a state for investment.

What Needs To Be Done First

Before implementing any such laws for private firms Jharkhand government must assure MNC’s that they have a business-friendly environment, they have to provide easy access to lands and minerals to business firms with tax redemptions and less paperwork.
Government need to make sure that their workforce is skilled enough to meet business requirements.

  • Training Centers for skill improvement.
  • Basic education facility needs continuous update and improvement.
  • People-friendly police.
  • The Judiciary system needs to be smooth.
  • Opposition and Lead parties should not do politics in matters of development.

Only after we succeed in providing these basic facilities, only then Jharkhand government can think of implementing any such law related to reservation.

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