New Delhi 24 September 2003

“Globalisation is a fact, not an option and a deeper integration of the production process is significantly affecting the informal, unorganised sector,” said Kirit Parikh, Professor Emeritus of Indira Gandhi Institute of Development Research, Mumbai and a member of the Prime Minister of India’s Economic Advisory Council. He was delivering the keynote address in a national dialogue on “Globalisation and the Informal Sector”. The meeting was organised by Consumer Unity & Trust Society (CUTS), Jaipur, an international non-governmental organisation working on issues of international trade and development. It was organised with the support of Oxfam GB in India, a development agency working in the country for over fifty years.

Participants representing non-governmental organisations, fair trade movement, women’s groups, producer’s groups, labour interests from different parts of the country took part in two-days deliberations covering issues impacting the Indian informal sector. Welcoming the participants, Rajan Gandhi, Director of CUTS Delhi Resource Centre expressed hope that the advocacy points, which would come out of the meeting, will help NGOs and other bodies to take forward the concerns of the informal sector, in particular on livelihood issues in the face of changing domestic and global economic scenarios.

Samar Verma, Policy Advisor of Oxfam GB in India argued that in this era of globalisation and economic liberalisation one of the most significant changes are taking place in commodity prices. He pointed out that in the decade of 1990s prices of many agricultural commodities, like coffee, cotton, came down significantly. Along with shift in cropping pattern from food to cash crops, these changes have impacted the livelihoods of many poor farmers. The advent of a rules-based trade regime under the World Trade Organisation has not resulted in any significant positive impact on the lives of the poor. In fact, Oxfam International’s Make Trade Fair campaign has come out with analysis showing how trade rules are being rigged to the detriment of the poor.

In this context non-governmental organisations and other stakeholders have very important roles to play in policy advocacy through generating information from the grassroots. This was expressed by Bipul Chatterjee, Director of CUTS Centre for International Trade, Economics and Environment, Jaipur. He provided an overview of the project “Globalisation, Economic Liberalisation and the Indian Informal Sector” and urged for information-based policy advocacy at various levels, involving different stakeholders for the Indian informal sector to play a positive role in the process of globalisation. The project has taken into account the challenges and opportunities that three sectors are facing: non-timber forest products, handlooms, and handicrafts.

Many participants were of the opinion that globalisation is not a threat, but an opportunity in terms of expanding markets. However, many have urged the government that in order to avail the opportunities, it is important that they are allowed to operate under an enabling policy environment. The government’s role should be to regulate policy implementation and provide means for social safety nets for the poor. It was pointed out that even the poorest of the poor have considerable assets, intellectual or otherwise, and all they require are right policies to better utilise their skills and knowledge. Non-governmental organisations, the fair trade movement and other stakeholders should facilitate the process of skills upliftment, generation of new markets, marketing of products, etc.

Speaking on globalisation and labour issues, N. P. Samy of NCL, Hyderabad argued that the bottom of the economic pyramid is being crowded with more and more people getting precipitated downwards, increasing the ranks of agricultural labourers, construction workers, and other informal sector workers. On issues that women are facing in the era of globalisation, Roopa Mehta of SASHA, Calcutta said that empowerment of women entrepreneurs is the key to effectively run economic activities. It is important that efforts should be made to protect indigenous designs, motifs, knowledge and skills.

Addressing the linkages between international trade and the informal sector, P. M. Mathew of ISED, Cochin argued for more debates on the political economic aspects of public policy designed for the sector. The debate should focus on institutional structure and policy instruments required for the Indian informal sector to be more competitive in this globalising era.

Speaking at the closing session, Anand Das, Programme Coordinator (Market Access) of Oxfam GB in India mentioned that the aim of the project was to get multiple stakeholders into dialogues platforms to discuss and debate issues that the Indian informal sector is facing. He expressed the need to introduce some changes in the Unorganised Labour Bill, which has been introduced in the parliament. In particular, the Bill should have sections on working conditions, terms of employment, and code of conduct for the informal sector, he argued.

Delivering the valedictory address, Veena Jha, Coordinator of the United Nations Conference on Trade and Development said: “In the decade of 1990s, informal sector has contributed significantly towards asset building, which is an important impetus for the Indian economy.” UNCTAD has done a study analysing the impact of globalisation on the informal sector in South Asia. The study shows that there is significant positive impact on employment generation in export-oriented sectors. The informal sector has also contributed towards improving the competitiveness of the economy. Therefore, it is time to look into the opportunities that globalisation can offer for strengthening the contribution that this sector can make towards more equitable development of the Indian economy.