Following widespread criticism of the Bill, Karnataka chief minister Siddaramaiah said the Bill is still in the preparation stage
The Bill reserves 50% jobs in the private sector at management level and 70% at the non-management level for locals
Meanwhile, neighbouring states Andhra Pradesh and Kerala used the criticism of the Bill as an opportunity to promote themselves as attractive investment destinations
Amid widespread criticism of Karnataka’s job quota Bill, the state government has put the Bill on hold.
In a post on X, chief minister Siddaramaiah said, “The draft bill intended to provide reservations for Kannadigas in private sector companies, industries, and enterprises is still in the preparation stage. A comprehensive discussion will be held in the next cabinet meeting to make a final decision”.
At the heart of the debate is the Karnataka State Employment of Local Candidates in the Industries, Factories and Other Establishments Bill, 2024, which reserves 50% jobs at management level and 70% at the non-management level in the private sector in the state for locals.
However, the state government took a U-turn on the matter amid criticism from industry stakeholders.
Meanwhile, neighbouring states Andhra Pradesh and Kerala used this opportunity to promote themselves as attractive investment destinations.
In a post on X, Andhra Pradesh minister Nara Lokesh urged IT companies to relocate to the state’s software cluster at Visakhapatnam. He also offered sops such as “best-in-class facilities, uninterrupted power and infrastructure” for IT enterprises without any “restrictions” from the government.
“We understand your disappointment. We welcome you to expand or relocate your businesses to our IT, IT services, AI and data centre cluster at Vizag. We will offer you best-in-class facilities, uninterrupted power, infrastructure and the most suitable skilled talent for your IT enterprise with no restrictions from the government,” Lokesh said.
Meanwhile, Kerala industries minister P Rajeev also called on companies to move their base to the state citing a “hassle-free environment”.
“Invest in Kerala. Employee talent and merit are the only criteria for recruitment. It is the right time for companies to discover Kerala, with its highly skilled talent pool, the best climate, and a hassle-free environment. Embrace this opportunity… #KeralaCalling,” said Rajeev on X.
The ministers were responding to industry body National Association of Software and Service Companies’ (NASSCOM’s) statement on the controversial Bill introduced by the Karnataka government.
Earlier in the day, NASSCOM expressed “disappointment” and “deep concern” over the Bill. The industry body said that the mandates would likely force companies to relocate elsewhere owing to “scarce” local skilled talent.
Calling for the rollback of the proposed law, NASSCOM said that the Bill’s provisions would drive away companies and stifle startups in the state.
“It is deeply disturbing to see this kind of Bill which will not only hamper the growth of the industry, impact jobs and the global brand for the state… The bill’s provisions threaten to reverse this progress, drive away companies and stifle startups, especially when more global firms are looking to invest in the state,” added the industry body.
Meanwhile, Mohandas Pai, former chief financial officer (CFO) of Infosys and partner at Aarin Capital, called the job reservation quota for locals “illegal” and a “draconian bill” that would deter future investments in the state and compel businesses to relocate elsewhere.
On similar lines, Biocon chairperson Kiran Mazumdar-Shaw also criticised the Bill and said, “As a tech hub, we need skilled talent and whilst the aim is to provide jobs for locals we must not affect our leading position in technology by this move. There must be caveats that exempt highly skilled recruitment from this policy.”
Bengaluru-based fintech juggernaut PhonePe’s cofounder and CEO PhonePe also chimed in the on debate. Taking to X, Nigam said, “I am 46 years old. Never lived in a state for 15+ yrs. My father worked in the Indian Navy. Got posted all over the country. His kids don’t deserve jobs in Karnataka? I build companies. Have created 25000+ jobs across India! My kids don’t deserve jobs in their home city? Shame”.
