Reforming the Industrial Dispute & Trade Union Acts

This paper looks at how labor laws in India may have slowed down employment growth. It estimates how much growth is being foregone due to the lack of labor mobility from agriculture to industry. It then focuses on Industrial Disputes Act and Trade Unions Act. The paper discusses specific provisions which may have negatively impacted employment growth, including the provisions for employment termination in India, requiring the permission of the government and consultations with trade unions. It examines how they need to be reformed, by looking at lessons from within India and other countries. Finally, it examines the case of Korea as a success story in generating laborintensive manufacturing growth.