(Video) Rajya Sabha TV (RSTV) The Big Picture: Formalising Informal Economy

Topic: Formalising Informal Economy

Guest:

Aman Agarwal, (Director, Indian Institute of Finance)
Ajay Dua, (Former Secretary, Ministry of Commerce & Industry)
Yatish Rajawat, (Senior Journalist)

Topic Description:

A vast majority of India's workforce is informally employed - those who work outside of formal establishments, in un-incorporated private enterprises and mostly without any social security benefit. A new research now finds that Modi 1.0's reforms and policies have managed to push ahead with the greater formalisation of the country's workforce. More than seven million jobs have been formalised between 2015 and 2018, a study commissioned by the Indian Staffing Federation stated. The policies that contributed to formalisation include the introduction of the Goods and Services Tax, demonetisation, EPF reforms, Skill India initiatives, Fixed Term Contract Reform, as well as the Maternity Benefit reform. These reforms could contribute to even more of India's workforce transitioning to the formal, going ahead. The study, projects, that about 11 million more jobs will move to the formal sector between 2018 and 2021. Of the seven million jobs that shifted to formal sector in 2015-18, EPF reforms contributed 18.16 per cent, ESIC 17.68 per cent, GST 15.32 per cent, Skill India initiatives 13.10 per cent, demonitisation 12.35 per cent, maternity reforms 11.83 per cent, and Fixed Term Contract 11.56 per cent.