The Politics of Labour Reforms in India

Abstract

Labour policies and labour laws in India are focused rather narrowly on the 8 per cent organized labour. In the pre-liberalization era labour was protected in labour markets and capital in product markets. In the post-liberalization era both remain less protected, if not altogether unprotected. The shift in focus from labour markets to product markets in the context of liberalization is viewed with concern by organized labour. For over three decades comprehensive labour reforms have eluded India. The need for aligning labour laws with industrial policies is recognized, but the government is hesitant to take political risks. Unions want more protection, while employers want greater freedom and flexibility in dealing with labour. This paper exposes six myths, identifies key concerns and presents an agenda for labour reform.