Day 28 – Q 4. The governance mantra in contemporary free market economy is that the government has no business to be in business. In a politico-economic milieu like this, how are labour rights protected? Are there proactive and powerful pressure groups for the furtherance of labour interests in India? Discuss.
4. The governance mantra in contemporary free market economy is that the government has no business to be in business. In a politico-economic milieu like this, how are labour rights protected? Are there proactive and powerful pressure groups for the furtherance of labour interests in India? Discuss.
समकालीन मुक्त बाजार अर्थव्यवस्था में शासन का मंत्र यह है कि सरकार को कोई व्यवसाय नहीं करना चाहिए। इस तरह की राजनीतिक–आर्थिक क्षेत्र में, श्रम अधिकारों की रक्षा कैसे की जाती है? क्या भारत में श्रम हितों को आगे बढ़ाने के लिए सक्रिय और शक्तिशाली दबाव समूह हैं? चर्चा करें।
A free market economy is a type of economy that promotes the production and sale of goods and services, with little to no control or involvement from any central government agency. The economic system is primarily based on supply and demand. Order and power in a free market are decentralized, with individuals making all of their own voluntary economic choices.
- In a free market economy, firms and households act in their own self-interest to determine how resources get allocated, what goods get produced, and who buys the goods. A free market economy is functions in an opposite manner as a command economy works, where the central government gets to keep the profits and choose how to use them.
- The government’s role in the economy is limited (e.g. to preventing monopolies, allowing fair and equal access to markets for all, protecting the nation and its markets through military means).
- As India’s Prime Minister has said recently, Government’s job is that of a facilitator to create new opportunities and in the government system, the fewer the laws the less suffocated businesses feel.
A free market protects the rights of workers by allowing the workers to decide what’s best for themselves.
- The basis of a free market is voluntary interaction in which both parties engage in a consensual agreement. Because of this, in a free market, almost any exchange would be win-win.
- At the same time, an unregulated, free market would not protect the rights of workers. Free markets are subject to manipulation, mis-information, asymmetries of power & knowledge, and foster wealth inequality.
- Also in a free market, a competitive environment creates an atmosphere of survival of the fittest. This causes many businesses to disregard the safety of the general public to increase the bottom line.
- Regulation is aimed at balancing free market’s virtues against its pitfalls as although some aspects of the market may be self-regulating, other things, such as environmental concerns, require government intervention.
In India, there are 44 labour laws under the purview of Central Government and more than 100 under State Governments, which deal with a host of labour issues. Unfortunately, these labour laws protect only 7-8 percent of the organised sector workers employed at the cost of 93 percent unorganised sector workers.
Following are some of the Central legislations passed under different articles of the Constitution-:
- Minimum Wages Act, 1948.
- Industries (Regulation and Development) Act of 1951.
- Industrial Disputes Act, 1947.
- Factories Act of 1948.
- Contract labour Act 1970.
- Trade Unions Act 1926.
In addition, the multiplicity of statutes, there are concerns around the protection of the workforce and effective implementation of statutes.
As a part of its ease of doing business initiative, the government will be subsuming a total of 44 labour laws into four codes — on wages, social security, industrial safety and welfare and industrial relations. Further, the Union Cabinet has cleared the Occupational, Safety, Health and Working Conditions Code, earlier it approved the Code on Wages Bill.
- A pressure group is a group of people who are organised actively for promoting and defending their common interest. They are a vital link between the government and the governed.
- Trade unions/Labour Unions are a form of pressure groups who cater to the demand of workers and labours of the industries. Alternatively, they are also known as labour groups.
- Some of the most important functions of the trade union are as follows:
- Increasing Co-operation and Well-being among Workers
- Securing Facilities for Workers
- Establishing Contacts between the Workers and the Employers
- Trade Unions working for the Progress of the Employees
- Safeguarding the Interests of the Workers
- Provision of Labor Welfare.
- In India, different trade unions represent different political parties. Examples- The All India Trade Union Congress (AITUC), All India Trade Union Congress (Communist Party of India)
- Bharatiya Mazdoor Sangh and Hind Mazdoor Sangh are also labour unions which are proactive and push for labour interests in India. Recently, they played a key role in influencing the government towards not signing the Regional Comprehensive Economic Partnership(RCEP) to safeguard the interests of labourers in India.
Pressure groups, different as they are from political parties, exist and function to influence the policies of the government to attain their specific/particular interests. Their role, in modern democracies like India is, indeed, significant towards the empowerment of proletariat section of population.