Karnataka puts 100% quota bill on hold after massive backlash from industry

After a massive backlash from the industry, the Karnataka government has decided to put on hold a bill mandating 100 per cent reservation for locals in the private sector. The decision came hours after the state cabinet cleared the bill, which proposed the appointment of Kannadigas to 50 per cent of management positions and 75 per cent of non-management positions in the private sector. 

Earlier today, Karnataka Chief Minister Siddaramaiah said the Cabinet had approved a bill mandating 100 per cent reservation for Kannadigas in private firms for Group C and Group D posts. The decision was taken in the Cabinet meeting held on Monday. 

However, the bill faced massive pushback from industry leaders such as Kiran Mazumdar-Shaw, and Mohandas Pai, who demanded immediate withdrawal of the bill. 

IT industry body Nasscom warned that the legislation would erode the state's edge in technology, and reverse the progress made so far. The IT industry body also sought an urgent meeting with state authorities to discuss the concerns and "prevent the state's progress from being derailed", the association said. 

"Nasscom members are seriously concerned about the provisions of this bill and urge the state government to withdraw the bill. The bill's provisions threaten to reverse this progress, drive away companies, and stifle startups, especially when more global firms (GCCs) are looking to invest in the state," Nasscom said in a statement. 

Stating that the tech sector contributes to 25 per cent of the state GDP, houses a quarter of the country's digital talent, has over 11,000 startups and 30 per cent of the total GCCs, Nasscom contended that the restrictions could force companies to relocate as local skilled talent becomes scarce. 

As industry leaders expressed unhappiness over the bill, TDP's Nara Lokesh moved quickly and invited industries to Andhra Pradesh. "We understand your disappointment. We welcome you to expand or relocate your businesses to our IT, IT services, AI, and data center cluster at Vizag," he said in a tweet. 

"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."   

While the Siddaramaiah government defended the bill, industry veterans called it 'fascist,' and 'short-sighted.' The state government, however, said the interests of the private sector will be protected. 

Medium and Heavy Industries Minister M B Patil backed the bill, saying there is no doubt that Kannadigas should get jobs in Karnataka. He, however, underlined that the interests of the industries will also be safeguarded. "In private sector, certain ranks of posts will be reserved 100 percent for Kannadigas. The interests of industries will also be protected." 

In a statement, his office said the minister will discuss with the chief minister, IT-BT, Law and Labour Ministers in the event of any confusion in the bill. "The government will also work on the skill development of Kannadigas. We cannot miss the bright opportunities of manufacturing sector and industrial revolution," he said. 

Karnataka Deputy Chief Minister D K Shivakumar said: "The Congress came to power in Karnataka to uphold the dignity of the Kannadigas--be it the issue of signboards of private establishments, the Kannada flag, Kannada language, culture, documents or specific percentage of reservation in jobs for Kannadigas." 

After critical reactions from the industry, Shivakumar said no investors need to worry and the government wants investors to come to Karnataka. "There are certain sections of the people who are talented and have come from outside the state. We want them to work in Karnataka. Bengaluru's population has grown to 1.4 crores because of the outsiders coming here to work. We just want to give them scope. We are more worried than both the employer and the employee. We will see where we can accommodate Kannadigas," he said while speaking to ANI. 

The bill proposed that any industry, factory or other establishments will have to appoint 50 per cent of local candidates in management categories and 70 per cent in non-management categories. If the candidates do not possess a secondary school certificate with Kannada as a language, they should then pass a Kannada proficiency test as specified by the 'Nodal Agency', it added. 

The nodal agency will have power to call for any records, information or documents in the possession of an employer or occupier or manager of an establishment for the purpose of verifying the report. The Government may appoint an officer not below the rank of Assistant Labour Commissioner as the authorised officer regarding compliance of the provisions of the Act. 

In a tweet, Siddaramaiah said: "It is our government's wish that the Kannadigas should avoid being deprived of jobs in the land of Kannada and should be given an opportunity to build a comfortable life in the motherland. We are a pro-Kannada government. Our priority is to look after the welfare of the Kannadigas."

(With inputs from Nagarjun Dwarakanath)