New Ficci President Harsh Pati Singhania disagrees with the observation of Railway Minister Lalu Prasad that the private sector firms are taking “anti-people” measures for their financial turnaround.
“I don’t want to debate with the minister ...but on an independent basis, I don't think private sector is anti-people,” Ficci chief.
In his Budget speech on February 13, Prasad had said that the railways had improved their balance-sheet without increasing prices or retrenching workforce unlike the private sector.
“The transformation of the railways is fundamentally different from the financial turnaround witnessed in the private sector companies. While private companies resort to anti-people measures like increase in prices, retrenchment of employees and lockouts, the railways have kept the human aspect as the central focus and achieved an extraordinary feat without putting any extra burden on the common man or the employees,” said Prasad.
Singhania said the railways did increase the freight charges, even though there were no across-the-board announcements.
“While over the years, it seems that freight rates have not been increased, there has been a fair amount of increase in freight rates at least for business because of different classification,” he said.
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As for Prasad's charge that the private sector achieves financial turnaround by increasing selling rates, Singhania said prices are matter of supply and demand.
“If prices of goods and commodities have gone up; they have also come down," he said, adding that because of revision in freight charges by the railways, the industry's input costs went up. "As far as business is concerned, we have to bear the brunt of higher costs of transport," he said.
The Ficci chief said industry would lay off people as a last resort. "Nobody wants to lose skilled workforce. So I do not think reducing people is an easy solution," he said.
However, in a difficult global environment industry has to become cost-competitive. "Companies need to remain competitive and this is one of the elements of cost. And if it has to come to the situation to reduce the manpower cost then companies resort to it," Singhania said.