Cong-led Karnataka govt puts job quota Bill on hold after industry furore

Nasscom said it is seeking an urgent meeting for industry representatives with state authorities to discuss the concerns

The controversial draft Bill proposing job quota for locals in Karnataka was put on hold late Wednesday evening following high-pitched industry protests through the day. 

This came just a day after the Karnataka Cabinet had approved a draft Bill mandating 50 per cent reservation to locals in private sector management jobs and 75 per cent in non-management positions.

In a X post in the evening, State Commerce and Industries Minister M B Patil said Chief Minister Siddaramaiah has taken “due cognizance” and the Bill “is withheld until further consultations and due diligence”. 

Patil said that industry leaders need not panic. 

 

“The government is committed to further creation of jobs and furthermore for Kannadigas, however, in a more amicable manner," Karnataka minister Patil said. 

Before this, Siddaramaiah asserted that the Karnataka State Employment of Local Candidates in the Industries, Factories and Other Establishments Bill, 2024, was still at the preparatory stage and that a final decision would be taken after comprehensive discussion in the next Cabinet meeting.

Earlier in the day, reacting to the Karnataka government decision on job quota for locals, IT industry body National Association of Software and Services Companies (Nasscom) raised serious concerns over the move, calling it "deeply disturbing".

Soon after, Andhra Pradesh HRD minister Nara Lokesh took to the social media to invite the IT industry in Karnataka to shift to his state. Making an offer of ‘’best in class facilities’’ in power and infrastructure, he addressed Nasscom in an X post: ‘’We understand your disappointment. We welcome you to expand or relocate your business to our IT, IT services, AI and data cluster at Vizag.’’  

Bengaluru, which is often called the Silicon Valley of India, has been a scene of furore over job for locals in the last 24 hours or so. Industry leaders slammed the decision taken by the Karnataka Cabinet on Tuesday, describing it as discriminatory and regressive.

Mohandas Pai, chairman of Manipal Global Education Services and the former CFO of IT major Infosys in a post on the X said: “This bill should be junked. It is discriminatory, regressive and against the constitution…. This is a fascist bill as in Animal Farm, unbelievable….’’ Pai hit out at the Congress-led Karnataka government for coming up with a legislation like this.

Kiran Mazumdar Shaw, executive chairperson of Biocon, also posted on the microblogging platform X. She wrote: “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.”

The technology sector has been crucial to Karnataka’s economic and social development, with Bengaluru known globally as India’s Silicon Valley, a Nasscom statement pointed out. ‘’Its 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.”

On Wednesday morning, Karnataka Chief Minister Siddaramaiah had posted on X that the Cabinet had approved a Bill to make it mandatory to hire 100 per cent Kannadigas for C and D grade posts in all private industries in the state. In a dramatic turn of events, he deleted that post later in the day.  

R K Misra, co-chairman, Assocham- Karnataka, in his social media post called the bill short sighted. “Another genius move from the government of Karnataka…. This will scare Indian IT & GCCs,’’ he said.

The Bill defined a local candidate as a person who is born in Karnataka, domiciled in the state for a period of 15 years, and capable of speaking, reading, and writing Kannada legibly.

According to Praveen Agadi of the Karnataka Chamber of Commerce and Industry (KCCI), the decision is a double edged sword as it will affect both large companies in the information technology and construction spaces and micro small and medium enterprises (MSMEs) as well. Karnataka is heavily dependent on outside employees in major sectors like IT and construction in the management level, he said. Also, in the non-management level, majority of MSMEs and large companies in the construction sector are dependent on migrant population. ‘’Where will the industry find local employees?  Industry will start losing benefits from the government," Agadi said.

According to the last Census, around 51 per cent of the population in Bengaluru were migrants.  Karnataka has a higher proportion of interstate migration at 37.82 per cent, versus a national average of just 4.48 per cent. The net in-migration state had 3.2 million migrants from other states in 2011, while outward migrant population was just 2.5 million.

A R Ramesh, chief executive office, TeamLease Degree Apprenticeship, said: "The current need is to emphasise skill development to address the gap between available opportunities and the requisite skills for employability.’’ He added that it is vital that a state like Karnataka is founded on the principles of meritocracy.