Pitching for labour law reforms, Chief Economic Adviser Krishnamurthy Subramanian Friday advised states to follow the Rajasthan model for better results.
"I think there are four-five labour reforms whatRajasthan did. And what we are saying is that by doing the labour reforms, Rajasthanwas able to increase number of firms of above 100 employees. It has increasedthe output of the factories and also number of workers and factories aswell," he told reporters on the sidelines of an interactive session at theIndian School of Business (ISB) here.
In 2014, Rajasthan was the first state that introducedlabour reforms in the major Acts. Thereafter, many states followed.
The major reforms undertaken by Rajasthan included theamendments to the Industrial Dispute Act, 1947, the Factories Act, 1948, theContract Labour (Regulation & Abolition) Act, 1970 and the Apprentices Act,1961.
Replying to a query on the impact of the slump in theautomobile industry on the economy, Subramanian said the industry is just onepart of the overall manufacturing sector which is doing well.
On doubling farmers' income by 2022, the CEA said thecommittee on the issue has suggested some steps to enable the small andmarginal farmers to sell their products in the market place.
Subramanian said the target of a USD 5 trillion economy inthe next five years is achievable.
"For the first trillion dollars that India created, ittook 55 years, and from USD 1.7 trillion to USD 2.7 trillion happened between2014 and 2019. So you can basically create that USD 5 trillion in (the next)five years," he said.
Speaking elsewhere in the city, former RBI governor CRangarajan said India needs to grow at eight per cent in order to become a USD5 trillion economy in the next few years.Subramanian said there is an opinion that thesmall and medium enterprises sector (firms with less than 100 employees)presents a lot of employment opportunities which is not practically true.