Is it a must to know the local Govt and Labor law for an HR professional?

yes it is very important to have knowledge about labor law and employee related local government regulations. Like for paid leave, gratuity calculation, compulsory medical insurance, requirement for new visa or change in employment status etc

Yes it is a must based on basic principles;

• Local Govt is part of your Stakeholders and play a part in reference to the PEST analysis of any company.
• Labor Law has to do with the legislation that governs the employment relationship to which breach has detrimental effects for the employer and / or the employee.