UP moots key labour reforms to come on par with other industrialised states

To improve the ease of doing business climate, the Uttar Pradesh government is working on key labour reforms to bring it at par with other industrialised states such as Maharashtra and Gujarat.

While the government is studying best labour-related practices in other states, it is also in the process of implementing the ‘reform action plan’ framework of the Centre, UP infrastructure and industrial development commissioner Alok Tandon told Business Standard here.

"The government is already working on the labour reforms agenda and it would soon be placed before the state cabinet for approval," he informed.

He said labour reforms were an ongoing process and the state industrial development and labour departments were proactively engaged to resolving such irritants faced by the industry.

Since the Adityanath government has set the target of UP hitting a $1 trillion economy by 2024, in line with Prime Minister Narendra Modi’s vision of India become a $5 trillion economy by that year, the state has been working on a slew of measures, including tweaking its policies to attract investment.

At the recent CII’s ‘UP Economic Summit’ here, industrialists had urged the Adityanath government to do labour reforms, especially with regards to the beleaguered small and medium enterprises (SME), so that they could better face market competition, especially during the economic slowdown.

The key demands of the SMEs are the provision of fixed-term and contractual labour so that they could exercise control on their fixed costs, and pare expenses and production according to the market demand.

At the same time, the process of collecting statistics pertaining to labour and employment in the state has traditionally been sloppy.

However, the state government has so far taken some steps to liberalise labour laws, including the raising of the ceiling from 100 to 300 workers for the sick units to exit without seeking a special certificate from the labour department.

Besides, the ceiling has also been raised from 10 to 20 workers and from 20 to 40 workers for units without and with power supply respectively for mandatory registration with the labour department.

Another major reform is the increase in ceiling for mandatory registration of firms for ESI and pension records from 20 to 50 contractual labour.

According to an estimate, UP has nearly 15,000 industrial units employing more than 25 workers, while nearly 85 per cent of the units have less than 300 workers.

However, there are labour related issues which have yet not been addressed, such as the provision of overtime for workers. The current state laws restrict workers to work overtime beyond a certain limit even if they are willing to earn additional income. Although, the state has relaxed the overtime norms to some extent, yet the industry has been seeking greater flexibility.

UP govt clears land hurdle for PepsiCo's Rs 500 crore plant in Mathura

The Uttar Pradesh government has cleared the land possession hurdle for global food and beverage major PepsiCo’s greenfield plant in Mathura district.

The company will invest more than Rs 500 crore in the proposed plant at Kosi, Mathura through the foreign direct investment (FDI) route and create nearly 1,500 direct and indirect jobs.

Earlier, the UP State Industrial Development Corporation (UPSIDC) had allotted 36 acres of land to the company. However, the local farmers had been agitating owing to their long pending demands and resisting the physical handover of a nearly 27 acres, thus delaying the starting of the project.

In a recent meeting to review industrial projects, for which the Yogi Adityanath government had signed memorandum of understanding (MoU) with private companies, UP infrastructure and industrial development commissioner (IIDC) Alok Tandon had directed the Mathura administration and UPSIDC officials to resolve the land acquisition hurdle pertaining to the PepsiCo project.

“The issue has been resolved and the company has started the civil work,” Tandon told Business Standard here today. He said it was after a gap of 13 years that PepsiCo was setting up a food processing plant in India after its Punjab unit, which was set up in 2006.

While, PepsiCo plans to invest more than Rs 500 crore, other independent ancillary units are estimated to bring additional investment of Rs 500 crore, thus totalling Rs 1,000 crore in total investment related to the entire potato chips project value chain.

PepsiCo will procure 60,000 tonnes of potato annually from the local farmers for processing in the plant, which a PepsiCo spokesperson, said would be made operational before mid 2021.

On July 28, 2019, PepsiCo plant was among the 292 industrial projects totalling more than Rs 65,000 crore, which witnessed their foundation laying in Lucknow at the hands of union home minister Amit Shah.

The projects, whose foundation was laid, spanned different sectors, including agriculture, tourism, micro small & medium enterprises (MSME), excise, healthcare, power, textile, urban development, science & technology, green energy etc. Nearly 54% of these projects pertain to Western UP, followed by 19% Central UP, 13% Eastern UP, 4% Bundelkhand, while about 10% of the projects had multiple territory footprint.

The ground breaking ceremony (GBC) was also addressed by top industry captains, including Gautam Adani, N Chandrasekaran, realty major Lulu Group chairman Yusuf Ali, Pepsico India chief Ahmed El Sheikh, Samsung Electronics Southwest Asia president & CEO H C Hong, Sudhir Mehta and Naresh Trehan.

These projects were part of the Rs 4.68 trillion worth of 1,047 MoU signed by the Adityanath government with public and private sector companies at the ‘UP Investors Summit’ in Lucknow on 21-22 February, 2018. The Summit was inaugurated by Prime Minister Narendra Modi in the presence of top industrialists viz. Mukesh Ambani, Kumar Mangalam Birla, Adani etc.

On July 29, 2018, Modi had presided over the first GBC, wherein foundation of projects worth Rs 60,000 crore was laid. He had also exhorted UP and Maharashtra to compete for emerging as India’s first $ trillion state economy.

UP govt announces revival package of Rs 1,100 crore for two sugar mills

Uttar Pradesh government on Tuesday said it will spend Rs 1,100 crore to revive two defunct state-owned sugar mills in the eastern part of the state.

These mills in Munderwa and Pipraich in Basti and Gorakhpur districts belong to will be developed as integrated sugar complexes comprising sugar factory, power cogeneration plant and ethanol/refinery unit.

A cabinet meeting headed by chief minister Yogi Adityanath this afternoon decided to help the mills owned by UP State Sugar Corporation Limited (UPSSCL).

Suresh Rana, sugarcane development minister, said the government will give Rs 438 crore and Rs 657 crore as loans to UPSSCL for reviving the Munderwa and Pipraich sugar mills.

Both plants will be made operational from the upcoming 2019-20 crushing season. From 2020-21, the plants will be equipped with modern technology to produce sulphur-free sugar.

“There is huge demand for sulphur less sugar in the market and it sells at a premium of Rs 150-200 per quintal compared to normal sugar. This would enhance the income of farmers in the region,” said Rana.

Munderwa plant will comprise a sugar factory of 5,000 tonnes of cane crushed per day (TCD) capacity (expandable to 7,500 TCD), 27 megawatt (mw) cogeneration facility and a distillery. The unit was closed down in 1999.

The Pipraich unit would comprise sugar plant of 5,000 TCD capacity (expandable to 7,500 TCD), apart from 27 mw power cogeneration unit and a modern plant of 120 kilolitre per day (KLPD) to produce ethanol directly from sugarcane juice. This unit had been lying closed since 2008.

“Pipraich unit would be the first ethanol plant in North India with the facility to manufacture ethanol directly from sugarcane juice. This fulfills our vision to provide the cane farmers with additional income,” Rana said.