Approach to Writing Mains Answer on 7-12-2020

Topic: Indian Economy – Growth and Development

Qn. “ Examine the recent initiatives taken by the Government of India to help improve the Ease of Doing Business with an emphasis on the Labour Code Bills 2020” (250 words)

Why this Question ?

The question is framed in the context of the editorial in today’s Hindu Newspaper that analyzes the effectiveness of the Labour Code Bills 2020.The editorial critiques that though on one hand the bills attempt to improve the Ease of Doing Business, but on the other hand, the Bills do not serve to protect the interests of the labour force and the working class.

The answer for the question needs to bring out the different initiatives ranging from the Insolvency and Bankruptcy Code to the recent Labour Code Bills 2020 etc giving more emphasis to the provisions of the different Labour Code Bills 2020.


The introduction for the question could be:

GDP growth rate in India had been steadily declining beginning from 2016. With a growth rate of 8% in 2016, the rate of GDP growth has steadily decreased to 5% in 2019. The reasons for this decline in GDP growth rate has been many ranging from low demand to a slew of government policies such as the short term effects of de-monetization and the sudden shift to the GST regime. In order to revive the ivestors confidence in the economy, the Government has introduced far reaching reforms in the form of a single unified IBC and labour law reforms that are long due.


The MCA 21 & e-bizz portal launched by the Government of India is a significant step in providing all the required services for starting a business at a single click. This makes it easier for any business to kick start its operations.

The cascading effects of taxes have been nullified by the introduction of a single tax in the form of Goods and Services Tax (GST). This single tax thus subsumes multiple taxes that are present in the nation making compliance easier for business.

The Insolvency and Bankruptcy Code, (2016) is a big statutory reform on bankruptcy. The code brings about an amendment into existing 11 laws to offer a consolidated law which defines time limit to resolve insolvency and has a provision of a regulator to oversee the process. This will have a big implication of the EODB score.

Labour Code Bill 2020 and its implications in improving the Ease of Doing Business (EODB)

Aim of the labour code bills :-

The codes provide for ‘one labour return, one licence and one registration’ to make running business in India easier.

It also raises the threshold for the requirement of a standing order to 300 workers. Industrial establishments with 300 or fewer workers will no longer be required to furnish a standing order.
The IR code also allows companies with up to 300 workers to fire workers without having to gain government approval. Currently, only industrial establishments with under 100 workers are allowed to do so.

In addition to these the labour code bills have also made the right to strike and to form trade unions more stringent. This can pave the way for reduction in unnecessary proliferation of Trade Unions for dubious reasons and can also help in streamlining the behaviour of the labour force in the industries. Reduction in down time due to frequent strikes has been a significant demand of the industry for long time.


These initiatives of the government to bring in changes in the way an industry or a business operates in the country can prove to be a game changer in attracting further inflow of Foreign investments and capital in India. These measures can thus help greatly in realizing the dream of “Atma Nirbahar Bharat”.