Apropos T N Ninan’s column “Moving on wheels” (Weekend Ruminations, January 18), the writer uses an apt metaphor of the automobile industry to show how changes in the sector reflect changes in the economic growth of a country. This analogy could be extended to cover two other features of Indian economy. First, the invasion of the industry by manufacturers from other countries, such as the US, Germany, Japan and Korea, is proof of the success of India’s 1991 policy of liberalisation and globalisation. What is striking is that foreign players are the major market players, particularly in the passenger car, three-wheeler goods carrier and two-wheeler scooter sectors, with more than 50 per cent market share. They dominate the passenger car sector (which accounts for 66 per cent sale of passenger vehicles) with 88 per cent share. However, the triumphant entry of Tata Motors abroad shows that it is not a one-way traffic. Second, even as more Indians are employed in foreign auto companies, the latter have not proved as harbingers of sound human resource practices. This is surprising since in their home countries, they set illuminating examples of good human resource practices, such as helpful outplacement service (OPS) to down-sized employees or management-trade union cooperation (as exemplified by concession bargaining such as between Ford and its trade union in 1982). Germany is known for its co-determination system in which worker-directors are a must. Japanese companies are known for their humane, almost paternalistic, treatment of their employees. However, when these companies set up business in India, they do not practise a shred of OPS. In fact, they play with labour laws (particularly relating to engagement of contract labour) and suppress trade unions, no doubt with the connivance of the state governments, as seen in the case of Maruti Suzuki’s Manesar unit. Thus, auto foreign players show that good industrial relations do not depend on different labour laws but on well-meaning management and honest state administration.
Y G Chouksey Pune
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