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Follow UsShashwat Chaturvedi
MUMBAI: On the 18th of April, Prime Minister Manmohan Singh was speaking at
the Confederation of Indian Industries (CII) annual event in New Delhi. His
government, especially union minister for HRD Arjun Singh, had come under a lot
of flak in the past few days for proposing to increase the reservation quotas in
premier Indian institutes.
A few political parties and a few more social organizations were pressing
upon him to introduce legislation for extension of reservation in the private
sector. Caught between the devil and the deep blue sea, prime minister Singh
sought to take the road of least resistance: remind the private sector of its
“obligation” to social welfare and exhort the private sector to bring about
reservations “voluntarily”.
Except for a few stray opposing voices, India Inc. chose to adopt the ostrich
approach towards the proposal to reserve jobs in the private sector. But
something seemed to have changed in these intervening months. Maybe the good
performance at the end of FY 2005 or the steady outlook in the future seemed to
have emboldened a few.
Azim Premji, chairman, Wipro, made his displeasure quite obvious. He made it
clear that Wipro will go by merit. Rahul Bajaj, chairman, Bajaj Auto, also
voiced his opposition to the move and quashed the constant comparison to similar
policies in the U.S., “There are no reservations in the private sector in the
U.S.,” he reportedly said. National association of software of service
companies (NASSCOM) and CII are also opposing any sort of legislation.
But reputed companies like TCS and Infosys have yet to formulate a reply to
the proposed threat. Consider this, TCS announced that it would hire 30,000
people, while Infosys is to hire 25,000 people in the coming year. Satyam pegs
the figure at 12,000, while none are available from Wipro. Still by a
conservative estimate the IT industry will hire close to 1,00,000 people in the
coming year. Even if a nominal 20 per cent reservation were introduced, it would
translate into 20,000 jobs. Enough to keep the vote bank happy and the industry
reeling.
In light of this, it is all the more imperative for Indian IT to take a
united stance against this. “India Inc. needs to stand up against this move
and say no to reservations,” exhorts Anand Deshpande, chairman and managing
director, Persistent Systems. For most it is just a question of profitability.
Once reservations are introduced, archaic labor practices and groupism will be
next. The public sector in India has for far too long suffered the brunt of
constant government intervention and arbitrary policy decisions.
No wonder, most of them are in the blue.
“We should encourage meritocracy. As a company, we hire people solely based on
their merit and performance. No other considerations are made, nor
discrimination done. Reservations will surely not solve the problem but create
many other,” says Ashank Desai, chairman, Mastek.
People drumming up support for reservations have often quoted U.S. policies
like affirmative action as a role model to be replicated in India. But, the
biggest differentiator is that the affirmative actions are in place to protect
against any sort of discrimination based on sex, creed, or race, etc. and not
reserve jobs or college seats. The only other place something similar has been
implemented is Malaysia, namely the Bhoomiputra policy.
So, is it the right time to introduce reservations in India as well?
Disagrees Krishan Dhawan, managing director, Oracle (India). “A move like this
will take us back in past. It will sorely affect the markets reforms process,
setting the process back,” he adds.
India Inc. has also been accused of losing sight of the “greater good”
for “greater profits”. Companies have been accused of only amassing wealth,
and thereby leading to a division between the haves and the have-not.
Sunil Mehta, vice president, NASSCOM, begs to differ. “Speaking from the
perspective of the IT industry, we are the largest employer of women in the
country. Close to 40 per cent of the workforce are women. Isn't that a case of
promoting social parity?” asks Mehta. “We promote welfare in the country by
providing employment to a large number of people and generating significant
revenues. That should be good enough,” argues Ashank Desai.
How will the multinationals react if reservations are implemented? Many
people are of the opinion that they will pull out; others feel that they will
exert pressure on the government. “The MNCs have a huge presence in India,
hence it will not be something abrupt like pulling out. A lot many might
reassess their future investments,” says Krishan Dhawan. According to Ashank
Desai, this move will reduce India's attractiveness globally and could have an
effect on the foreign investment.
On the question of pullout, Gerard Rego, vice president and general manager,
India Product Development, MSC Software Corporation India, reacts, “Not
necessarily, but will hurt the long term competitiveness of India and look at
countries like China.”
Ganesh Natarajan, deputy chairman and managing director, Zensar Technologies,
raises an important point. “We all sign contracts with our global customers,
stating that there will be no discrimination based on caste, sex, creed, etc. so
you are actually violating a contractual agreement with the customer. We need to
create a climate, where there are many more opportunities for everybody and not
restricting the opportunities for a few,” he says.
He also warns, “reservation will just create a cocoon, where certain people
will automatically except things to happen without striving for it.”
The coming weeks will be crucial, the union cabinet is scheduled to discuss
the desirability of introducing a law for reservations in private sector. Yet,
Ashank Desai is quite hopeful that good sense will prevail. “We are in
constant touch with the powers-to-be and trying to influence them in a positive
way. There is a lot more that is going on that is not in public domain,” he
seems to assure.
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