The bill passed by Andhra Pradesh Assembly on Wednesday reserving 75 per cent of jobs for locals in all industries in the state may multiply problems of the state already facing many challenges arising out of bifurcation five years ago.
While the apex industry bodies like Confederation of Indian Industry (CII) are yet to firm up their reactions to the new law, the industry is looking at the move with apprehensions and experts believe that this could further queer the pitch for investments into the state.
Already reeling under financial stress due to huge public debts and with the Centre in no mood to accord Special Category Status (SCS), the state recently received a big jolt with the World Bank and Asian Infrastructure Investment Bank (AIIB) pulling of a project to finance development of new state capital Amaravati.
YSR Congress Party government, which will be completing two months in office this week, appears to have taken the step on jobs for locals in a great haste.
Chief Minister Y.S. Jagan Mohan Reddy, who announced series of doles to fulfil his promises and also got some path-breaking legislations passed, apparently got carried away without going deep into the issue.
Though he claimed in the Assembly that his move is pro-industry, analysts say he will have lot of work to do to convince the existing industry and the prospective investors.
The bill provides for 75 per cent jobs for locals in all industries, including units, factories, joint ventures and projects set up under public-private partnership mode in the state.
Speaking in the Assembly Jagan Reddy blamed some ‘vested interests' for ‘false propaganda' that this will lead to shut down of industrial units and stop flow of industrial investment into the state.
He defending the move on the ground that this will lead to greater acceptance of the industry by the locals, thus helping it to prosper. He also assured industry of every help in return.
"We are ready to do anything for you. We only want jobs for our children," the chief minister said.
He also pointed out that the bill provides three year time-frame to the existing industry to meet the target.
If the industry can't find skilled manpower locally, the government will provide required training to the educated youth at 25 skill development centres to come up across the state.
Job creation was one of the major poll issues in the recent elections. YSRCP had targetted Telugu Desam Party (TDP) leader N. Chandrababu Naidu for failing to keep his promise of a job for every household.
The discontent among youth over Chandrababu failing to deliver on his promise was one the major factors for YSRCP storming to power with a landslide victory.
YSRCP leaders believed the Special Category Status (SCS) for the state could have helped it attract more investment and thus create adequate employment opportunities for the youth.
However, with the Narendra Modi government stuck to its stand on no more SCS for any state and the limited opportunities in government not sufficient to meet the job demand, Jagan Reddy apparently felt reserving a big chunk of jobs in the industry will satisfy them.
Experts, however, are skeptical about the move. They found fault with the government for taking such a big move without any study and without creating a skilled manpower to meet the industry requirement.
"The move is good if skilled people are available but this is not the case in most of the cases. Merely making rule will not help. You should go deep into the issue. It can't be done just like that," K. Lakshminarayana, former director, Andhra Pradesh State Skill Development Corporation (APSSDC) told IANS.
The former IAS officer said an expert committee should have been formed to study the issues like what are skills required by different sectors and why locals are not getting the jobs. "One month delay would not have made any difference. This is not the way of taking decision," said Lakshminarayana, who was also advisor to then Chief Minister Chandrababu Naidu.
He said such decisions should be taken without hurting the industry. He pointed out that there is a huge gap between the skills taught to students in colleges and the skills required for the industry. "The real growth is possible only with the right skills and hence there is a need to going to the root of the problem," he added.
Political analyst P. Raghava Reddy believes that 75 per cent of jobs for locals in industries is good for politics but nobody knows how far it is practical.
"There is no study as to how much jobs are there in the industry and how many locals are currently employed. Without any data and ground work, a bill was passed," he said.
He said the World Bank and AIIB pulling out of Amaravati project, the slump in real estate market in Amaravati, lack of help from the Centre and ambiguity in the state government over state capital affected the investment climate in the state.
Currently there is no quota for locals in private sector in Andhra Pradesh.
Whenever major industry sets up its unit, the state government only makes a request to give priority to locals in employment. Most of the jobs at the lower level go to the locals but for mid-level and higher category jobs requiring special skills, non-locals are recruited.
The state government jobs are for only locals. From the times of combined state of Andhra Pradesh, locals were given priority in employment and education opportunities.
This followed a constitutional amendment in 1973, which empowered the President of India to issue orders from time to time providing for equitable opportunities for people belonging to different parts of the state.
The amendment was brought following an agreement on a six-point formula between leaders of the state on Sep 21, 1973, following massive and violent protests in Telangana and later in Andhra for separate states.
The formula was aimed at a uniform approach for accelerated development of the backward areas of the state and to provide equitable opportunities to different areas in the matter of education and employment in public services. A zonal system was put in place and three to four districts were clubbed in each zone.
The system continues, albeit with some changes, after Telangana was carved out of Andhra Pradesh in 2014.
Telangana has no local quota in private sector. Though slogan of ‘water, funds and jobs' was central to the entire Telangana movement, the state did not push for reserving quota in private industry for locals. This is believed to be mainly because of the cosmopolitan life in Hyderabad, where the information technology sector employs techies from across the country.