← All questionsGS3 · 2016 · Indian Economy ·Globalisation and Informalisation of Jobs
QUESTION 1
GS3
12.5 marks

How has globalization led to the reduction of employment in the formal sector of the Indian economy? Is increased informalization detrimental to the development of the country?

WRITE IN
9 min
200 words

What the examiner wants

Explain how globalisation shrank formal employment and judge whether rising informality harms development.

How... IsAnswer exactly what the question asks.

Demand-wise check

  1. 1Channels: competition pushed firms to cut costs; contract and outsourced labour; capital and skill-intensive technology; cheap imports hurting MSMEs; flexible labour practices≈35 words
  2. 2Detrimental: low wages and productivity, no social security, narrow tax base, weak skilling, vulnerability in shocks (COVID)≈35 words
  3. 3Counter-view: informal sector absorbs labour and gives flexibility≈35 words
  4. 4Measures: labour codes, e-Shram, social security for gig workers, MSME formalisation (Udyam)≈35 words

Open in about 30 words and close in about 30.

Answer plan

Link globalisation to formal job lossEvidenceHarm of informalityCounterpointMeasures

Where marks usually go

  • Skipping how globalisation cut formal jobs: contract labour, outsourcing, import competition
  • Blaming globalisation alone without domestic factors like labour laws

Draw this

  • Flow: global competition → cost-cutting → contract labour → informalisation

Value addition

  • ReportNCEUS (Arjun Sengupta, 2007) found about 77% of Indians lived on less than Rs 20 a day and most workers were informal.NCEUS, 2007
  • ReportEconomic Survey 2018-19 estimated almost 93% of the workforce as informal.Economic Survey 2018-19
  • Schemee-Shram portal (2021) registered over 30 crore unorganised workers.Ministry of Labour

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