The Bajaj Lockout

Abstract

The Government of India is committed to bring about a balanced regional development. In pursuit of this important objective, the government has been granting new industrial licences only if the new projects are located in the "no industry" districts of backward regions.

While the objectives and strategy of development of backward regions are unexceptional, the implementation of this strategy poses many problems. A modern plant located in an underdeveloped part of the country faces many operational problems. It is not easy for managements to train personnel there to operate and maintain modern machines based on the latest technology. There is a great reluctance on the part of qualified managers and workers to accept positions in such locations given their non-existent infrastructure. The only economic advantage of locating plants in backward regions is the reduction in labour cost and the hefty subsidies received from the central and state governments.

For successfully implementing the strategy of developing backward regions, it is imperative that both the central and the state governments assist the managements in developing the necessary infrastructure and maintaining cordial relations with their employees. The Waluj plant case highlights these problems and triggers thinking on the action that needs to be taken. Vikalpa is thankful to Manik Kher of The Times Research Foundation, Pune, for the case.