Home CATEGORIES Business Ethics & Philanthropy The Buttress Of The Indian Socio-Economic Fabric

The Buttress Of The Indian Socio-Economic Fabric


The real scenario of India is that the populous unorganised sector lives as working poor.

The   ‘unorganised’ sector, also termed the ‘informal’ sector constitutes the backbone of the enormous labour force of India. This sector of workers forms more than 90% of the country’s workforce and contributes to more than 50% of the national economy. According to sources, “India’s economy has been adding about eight million new jobs every year predominantly in the low paying unorganised sector.”

The temporary workers form the prop of the Indian socio-economic fabric. The ‘casual’ labourers or ‘contract’ labourers as the term signifies are employed on a casual or contract basis by the employers for specific tasks like repairs etc. while many others are self-employed in unorganised retail industry as hand-cart vendors, street hawkers, newspaper vendors and local baniya outlets to name a few.

Further, the Indian society is heavily dependent on the informal sector whether for domestic work, repairs or for purchase of groceries as the super/hyper market concept has been gaining popularity for the past two decades only.

These casual labourers are in irregular employment and have one or a series of part-time jobs. “They are hired by the hours or the day or for the performance of specific tasks and for minimum number of hours per week”. As a consequence there is great “flexibility in operations and in hiring and firing.” Further, they are not entitled to health insurance, medical benefits, notice of termination, annual leave, paid personal leave and redundancy pay. They are paid a consolidated amount of remuneration.

It is reported that the Indian Railways employs maximum number of contractual employees in our country. They are however eligible for compensation in case of personal injury under the Employees Compensation Act.

The informal labourers-both rural and urban and males and females- are classified by the Ministry of Labour as follows:

A.) Basis of occupation: small land marginal farmers, landless agricultural labourers, share croppers, fishermen, those engaged in animal husbandry, beedi rolling, labeling and packing, building  and construction workers, leather workers, weavers artisans, salt workers, stone quarries  workers, brick kiln workers, saw mill workers, oil mill workers, dock and port workers.

B.) Nature of employment: attached agricultural labourers, bonded labourers, migrant workers, casual and contract labourers

C.) Distressed unorganised sector includes toddy tappers, scavengers, carrier of head loads/coolies, drivers of animal driven vehicles, loaders and unloaders.

D.) Service workers category such as midwives, domestic workers, barbers, vegetable and fruit vendors, pavement  vendors, newspaper vendors, handcart operators and the ‘unorganised retail’.

Indian ‘unorganised’ retail refers to the traditional formats of low cost retailing namely the local kirana shops, pavement vendors, owning or employed in an enterprise of less than ten people, embroidery work etc. and contributes to over 95% of total retail revenues.

These workers are subject to extortion exemplified in hafta or rangdari tax in Maharashtra. The extortion racket involves the local mafia. These workers are financially drained and are forced to restart the cycle of building up their working capital and are left scrimping and saving forever.

They are also subject to eviction supported by Article 19 sub-clause (b) and Article 19(6) of the Constitution which imposes reasonable restrictions on interests of general public. [Article 19 (1) gives the Fundamental Right to carry on any occupation, trade or business and practice any profession].

They are people of straw and are unable to bear the roller coaster ride in life.They are soon left indigent and debilitated. A multipronged approach is the only solution for their reinvigoration and amelioration.

The Public-Private Partnership Venture at the local and state level is the panacea for the rehabilitation of this dominant segment of labour that plays a pivotal role in our socio-economic configuration.

PPP, as defined by the GOI, is a “long-term contract between a private party and a government entity, for the provision of public assets and/or public services, through investments being made and/or management being undertaken by the private sector entity, for a specified period of time, where there is well-defined allocation of risk between the private sector and the public entity. The private entity who is chosen on the basis of open competitive bidding receives performance-linked payments that conform (or are benchmarked) to specified and pre-determined performance standards, measurable by the public entity or its representative.”

An efficacious support system must be drawn by the State Government, Local government bodies such as the Municipal Corporations,  Municipalities, Zilla Parishads and Panchayat  Samitis with the private enterprises whether Companies or NGOs on the lines of National Skill Development Corporation (NSDC).

The resuscitation of the informal sector of the workforce of India is definite with the adoption of the Integrated Support System implemented by a zealous Public Private Partnership endeavour.

The concomitant of a renascent unorganised labour force is a luminous India.

Jaya Chandrashekhar

The author Jaya Chandrashekhar was an Income-tax Officer and recently quit after decades of service. She also compered for the Yuva Vani English, AIR for a short while. Jaya has a keen interest in socio-economic issues and contributes to the GOI Portal, Indian Express amongst several others. In her spare time, she enjoys yoga and cooking.

Views of the author are personal and do not necessarily represent the website’s views.

Thank you for reading the story until the very end. We appreciate the time you have given us. In addition, your thoughts and inputs will genuinely make a difference to us. Please do drop in a line and help us do better.

The CSR Journal Team