Morning Brief: As Labour Codes Wait, States Push Forward With Reforms; India Eyes Bargain With China Amid Rising US Pressure On Beijing; After Tata, Tesla Explores More Chip Deals In India

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As Labour Codes Wait, States Push Forward With Labour Law Reforms

As the long-awaited labour codes remain unnotified, several states have proactively amended their labour regulations to attract investment, with 19 states and UTs raising the retrenchment threshold from 100 to 300. Additionally, many states have increased the threshold for the applicability of the Factories Act and the Contract Labour Act, while 31 states have allowed women to work night shifts. Fixed-term employment has been permitted in 25 states, and regulations for compounding offences have also been introduced in the same number of states.

Close to two dozen states are considering mandating strike and lockout notices across industrial establishments, a provision previously limited to public sector companies. Despite the pending labour codes, states are moving forward with reforms, encouraged by the Centre's push and the creation of best practice guidelines by a task force led by cabinet secretary T V Somanathan.

India Eyes Bargain With China Amid Rising US Pressure On Beijing

India plans to limit Chinese companies' equity in electronics joint ventures to 10 per cent, contingent on technology transfer, due to the lack of local expertise. Chinese supply chain and contract manufacturing firms will be preferred over Chinese brands to foster the development of India's local manufacturing ecosystem. The government is open to allowing up to 49 per cent equity for Chinese suppliers of US or European companies relocating from China, but this will be evaluated on a case-by-case basis.

India is wary of broad-based Chinese investment and aims to avoid becoming overly reliant on Chinese-developed ecosystems like Vietnam, preferring instead to build a local electronics manufacturing base. While open to helping US companies relocate from China, India also wants to boost its firms' presence in the US market, with a bilateral trade agreement expected later this year. 

After Tata, Tesla Explores More Semiconductor Deals In India

Tesla is engaging with US memory chip maker Micron and Mumbai-based CG Semi to explore procurement options as it looks to diversify its supply chain. This comes after the company’s previous deal with Tata Electronics to secure semiconductor chips for its global operations. Tesla has been in discussions with major semiconductor facilities in India, including those in Gujarat and Sanand, to understand chip packaging and production timelines.

India’s growing semiconductor sector is seen as an attractive alternative for Tesla, which aims to reduce its dependence on Chinese fabs due to rising geopolitical risks. While India faces challenges in scaling its chip industry, it has become a key player in meeting Tesla's evolving needs for automotive-grade chips and semiconductor packaging.

Other Developments

US Vice President JD Vance Begins India Visit

US Vice President JD Vance, accompanied by his Indian-origin wife Usha, will begin his four-day visit to India today (21 April). He is expected to meet Prime Minister Narendra Modi to discuss issues related to tariffs and a bilateral trade deal. The visit comes amid concerns over a tariff regime announced by US President Donald Trump.

Vance and his family will visit the Swaminarayan Akshardham temple and explore traditional shopping complexes before official talks. After the discussions, Vance will travel to Jaipur and Agra, visiting historical sites before departing for the US on April 24.

India Identifies Sectors For Zero-Tariff Deal In US Talks

As India prepares for talks with the US on a proposed bilateral trade agreement (BTA), the Indian industry has identified sectors like auto components, apparel & textiles, and electronics for a potential zero-for-zero tariff deal. However, priority items pushed by Washington, such as automobiles, motorcycles, alcohol, and agricultural products, are not included, indicating India's need for some protection in these areas.

The government is consulting with exporters and industry organisations to assess tariff cuts and non-tariff barrier removals that could be realistically achieved. A key concern is ensuring stringent rules of origin to prevent third-country exports from benefiting unfairly from the tariff cuts. Negotiations between trade officials from both countries are scheduled to begin in Washington on 23 April.

Jan Jeevan Mission Gets Rs 1.51 Lakh Crore, Less Than Half Sought

The Finance Ministry has proposed a 46 per cent cut in central funding for the Jal Jeevan Mission over the next four years, citing concerns over inflated costs approved by some states. The Jal Shakti Ministry had sought Rs 2.79 lakh crore to complete the mission by 2028, but it has received approval for only Rs 1.51 lakh crore. The cost of installing a tap connection has reportedly risen to Rs 1.37 lakh from Rs 30,000 in 2019, prompting the Finance Ministry to seek justification for the steep hike.

Nearly 75 per cent of the original target of 16.36 crore rural tap connections has been met, and the remaining 4 crore are to be covered in the extended phase. States, including those ruled by BJP allies, may now have to shoulder a larger financial burden, with liabilities estimated to cross Rs 1.25 lakh crore.

Ukraine And Russia Clash Over Failed Easter Ceasefire

Ukraine and Russia have accused each other of violating the 30-hour "Easter truce" declared by Russian President Vladimir Putin, which expired on Sunday (20 April). Ukrainian President Volodymyr Zelensky reported nearly 3,000 violations by Russian troops, while Russia's defense ministry claimed to have repelled Ukrainian assaults and accused Kyiv of launching hundreds of drones and shells.

Despite the ceasefire, US President Donald Trump expressed hope for a peace deal between Russia and Ukraine this week, though no further details were provided. Putin's ceasefire announcement aimed for hostilities to cease from Saturday evening to Sunday midnight, but Zelensky dismissed it as a "PR" move, accusing Russia of continuing the conflict.

From The States

Uddhav-Raj Thaw On Horizon, But No Alliance Yet

Shiv Sena (UBT) MP Sanjay Raut has clarified that there is no alliance between Uddhav and Raj Thackeray yet, calling their recent interactions purely “emotional talks.” However, he didn’t rule out a future tie-up, saying it was for the two estranged brothers to decide if they want to come together politically.

Raj Thackeray had recently said he was willing to work with Uddhav, and Uddhav responded positively but urged Raj to distance himself from "anti-Maharashtra" forces, hinting at the BJP. Raut echoed this, accusing such forces of trying to undermine Marathi pride. The potential reunion comes amid backlash over the Fadnavis government's decision to make Hindi compulsory in schools under the NEP.

The BJP, meanwhile, has mocked the Uddhav-Raj thaw, with Nitesh Rane asking if Uddhav consulted his wife before responding to Raj's statement.

Akhilesh Yadav Confirms INDIA Alliance For 2027 UP Polls

Samajwadi Party chief Akhilesh Yadav confirmed that the opposition INDIA coalition will continue into the 2027 Uttar Pradesh Assembly elections. He accused the BJP of trying to seize land through the Waqf (Amendment) Bill, calling them a "land mafia party," and claimed that the PDA (Backward, Dalits, and Minorities) would defeat the BJP in 2027.

Yadav also criticised the BJP's handling of the Maha Kumbh in Prayagraj, alleging mismanagement, inaccurate casualty figures, and faulty surveillance during the January stampede. He further defended SP MP Ramji Lal Suman’s controversial statement on Rana Sanga, stating that historical narratives should not hinder progress.

You’re all caught up—until next time.