The Karnataka Congress government’s move to play the sub-nationalism card by reserving jobs for “Kannadigas” in managerial and clerical positions in the private sector has faced severe criticism from industry leaders. Following the adverse reaction, the state government has decided to reconsider its planned new legislation.
“The bill approved by the cabinet to provide reservations for Kannadigas in private sector organizations, industries and enterprises has been temporarily put on hold. This will be revisited and decided in the coming days,” Karnataka chief minister Siddaramaiah said in an X post.
The new legislation, approved by the state cabinet, was scheduled to be presented in the ongoing legislative session. It stipulated that 75 per cent of non-management category jobs and 50 per cent of managerial jobs should be reserved for locals.
This led to widespread discontent among industry leaders in Karnataka, with many describing it as a “poorly thought-out bill that lacks direction”.
Assocham co-chairman RK Mishra told News18 that the “bill was poorly thought-out”. He argued that this move would send the wrong signal and force industries to leave the state and look for more industry-friendly environments elsewhere. “IT companies, manufacturing, MNCs, and startups all compete globally. If they enact such laws, they will force companies to leave. A message would have already reached their top-level management that Karnataka expects them to hire people without merit. The next time they consider expanding their companies, they will think again,” Mishra said.
He advised that Karnataka should start an apprenticeship programme to train talent, with the government creating a repository of skilled workers for hiring. “It could be for a period of three months. They can be trained for three months in the industry and made ready. But such moves are not healthy for the industry,” he added.
Karnataka labour minister Santosh Lad had countered this, calling it a move to protect Kannadigas and ensure that the natives get the opportunities they deserve. “What is the fear? How is it not going to benefit them? We have defined who a Kannadiga is. I feel this is totally justified. Karnataka is the state that is most technically equipped, with a lot of talent and the best infrastructure compared to other states. How can they justify that we don’t have a skill base?” he questioned.
Lad had stated that the industry should not fear hiring locals, adding that half of the positions have been left for talent from outside the state. “We are only talking about 50 per cent in management. A Kannadiga deserves that much. Is there no local talent? If there isn’t talent, have they even sent an application to the government saying they want skilled talent and the state is not producing as much? Then it may be considered, but they cannot do so, right?” he added.
Nasscom, the Indian IT industry body, expressed disappointment and concern over the Karnataka State Employment of Local Industries Factories Establishment Act Bill, 2024. It argued that the bill, which mandates significant job reservations for locals, will harm the technology sector, which is vital to Karnataka’s economy, contributing 25% to the state GDP and housing over 30% of the total Global Capability Centres (GCCs) and 11,000 startups.
Nasscom fears that the bill will reverse progress, drive away companies, and stifle startups, especially as global firms look to invest in the state. It emphasised the need for a dual strategy of attracting global talent and investing in local talent development.
Seeking an urgent meeting with the government, Nasscom stated that its “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 progress, drive away companies, and stifle startups, especially when more global firms (GCCs) are looking to invest in the state. At the same time, the restrictions could force companies to relocate as local skilled talent becomes scarce.”
A Bengaluru-based MNC in the services industry, which did not want to be named, reacted by saying that this was an “anti-industry move” that would make Karnataka regress and force companies to leave. “Companies are looking at this as a hostile move and using force to try and employ people who may not even have the competitiveness,” it said.
Political analyst Sandeep Shastri noted that this was not a new step and had been a recurring theme for Siddaramaiah, even before he became the chief minister. “He has focused on Kannadiga pride and sub-nationalism in his earlier term as well. Even their political campaign was based on local pride. I also believe that this is a global sentiment and there is a demand to find local talent wherever possible. The whole H1B visa issue is about hiring people from outside the country or state only when local talent is not available,” said Shastri.
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