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Citizen-workers and Class Politics in Neoliberal India

by Elizabeth Hill on January 12, 2015

The 21st century is the age of the ‘precariat’, an era of ‘footloose labour’ defined by insecure, unprotected and low-paid work. Narratives about the changing nature of work typically include a lament about the declining power of the labour movement and the difficulties contemporary unions face organising an increasingly mobile, contracted-out, self-employed, feminised and, in many cases, home-based labour force. Some unions in the Global North have responded to the evolving employment landscape and developed a range of new union strategies such as employer-union ‘partnerships’ and the ‘organising model’ to meet the needs of post-industrial workers. These strategies have had some success. But perhaps we should be looking elsewhere for a contemporary analysis of labour organising and struggle amongst precarious and footloose labour. Rina Agarwala’s recent book Informal Labor, Formal Politics, and Dignified Discontent in India points us in the direction of the Global South.

IndiaAgarwala’s book, like much of the literature on informal worker movements, focuses explicitly on women workers. Why is this? Women workers have historically been at the forefront of informal worker’s movements simply because mainstream male unions have ignored them. Labour movements across the globe were established on the factory floor of industrial plants where men were the primary workers. There is, of course a vibrant history of women’s involvement in the global labour movement, but trade unions have been largely masculine institutions who at best have added women’s concerns on to the main task of protecting the work conditions of formal male breadwinners. This is as true in India as in any other country. Sidelined by the union movement and located in the most vulnerable forms of employment, women working in the Indian informal economy have had to form their own unions and labour organisations, bypassing the mainstream union movement, as noted in my own monograph Worker Identity, Agency and Economic Development: Women’s Empowerment in the Indian Informal Economy.

Most economies and labour markets of the Global South have been long defined by deeply entrenched structures of economic informality which leave most workers exposed to highly exploitative employment relations, performing work that is often dangerous, very poorly paid, unregulated and unprotected by labour law. The informal economy is now so pervasive in the Global South that it has been normalised by international economic institutions and accepted as a regular feature of neo-liberal development. In India, economic informality is a defining feature of the post-colonial economy. Recent efforts to liberalise domestic markets and promote integration with the global economy have delivered high growth rates while the proportion of informal employment in the economy has increased. This is a sharp departure from the traditional expectation that economic development would see the informal economy fade away. It is in this context of contemporary neoliberal economic reform and mass informalisation that Agarwala sets out to investigate the dynamics of informal labour organisations and struggle.

HillIn their own unions and labour organisations informal women workers have pushed the boundaries of traditional labour organising strategies beyond the factory floor. In the neoliberal era of flexible production and footloose labour, Agarwala shows how within the informal economy the regular employee-employer relationship is destabilised and informal indirect employment relations become the norm. Likewise, economic informality blurs the industrial-capitalist division between workplace and home as productive and reproductive labour become co-located. In India the home becomes the production site for home-based bidi (a local cigarette) workers, and the production site becomes the home for temporary migrant workers who leave their villages to work on construction sites in the cities. This blurring of the traditional public/private division means that informal workers have an acute awareness of the material conditions of their informal economic status and insecure livelihoods. This translates into a very different approach to labour organising—both in terms of strategy and content—and has placed women at the vanguard of organising efforts that make a claim on the state to deliver important forms of social consumption. It is women workers who are forcing the state to grapple with a holistic account of ‘the economy’ and instigate public action that supports the reproduction and well-being of workers and their households. For scholars working on informal labour movements, it is women workers who are at the forefront of innovation and organising action. Feminist theory therefore provides a critical analytical lens through which Agarwala develops her broader theoretical account of the production of informal class relations and action.


The book focuses on informal workers as a distinct class of workers who occupy their own position within the broader class structure of Indian society. Agarwala’s analysis highlights the way in which workers employed in a range of occupations and under a variety of specific conditions share a common experience on account of their mutual location as dependent, highly insecure and informal workers. This, she argues, defines informal workers as a class ‘in themselves’. Agarwala extends her class analysis to show how this class of workers, defined by their structural location within the Indian political economy, have a set of shared and unique interests which underwrite informal worker organisations and strategy. That is, informal workers are a class ‘for themselves’.

bidi2This is an important argument, given the residual status traditionally afforded informal workers as either a pre-capitalist proletariat or a reserve-army of labour. Agarwala argues that both views are incorrect. Instead, she claims that informal workers, as a class, play a strategic role within the neoliberal model of Indian economic development and global integration. This is on account of the dual role of the informal economy to (1) provide survival-based employment for the low-skilled unemployed millions; and (2) provide global/national capital with access to a large pool of low-paid highly flexible labour that can be used to attract investment and facilitate growth. This means the informal economy is of value to both vulnerable workers and capital. But it is the strategic location of the informal economy within the national development model that makes the class position of informal workers unique and stable.

Having established informal workers as a class of workers with a unique set of interests, Agarwala continues her investigation by asking: What collective action strategies do informal workers use? Do their strategies vary? And, what is the foundation of their bargaining power? To answer these questions Agarwala focuses on the most marginalised of informal workers—women who do informal contract work in the construction and tobacco industries. The study investigates informal worker organising in these two industries across three Indian states—Tamil Nadu, Maharashtra and West Bengal. These states have been chosen as comparative sites of study on account of their different approaches to economic development, their electoral politics and their labour movement histories.


Agarwala finds that women informal workers in all three states do organise and collectively advocate for themselves. This was true irrespective of each state government’s relative commitment to economic liberalisation. But unlike traditional labour unions, women’s informal worker organisations did not agitate for improved wages and conditions. Informal contract workers are not formally employed by a single employer and the lack of a direct employer-employee relationship means workers do not have an employer against whom they can advocate for improved wages and conditions. In the absence of an employer, Agarwala found that informal women workers in all three states targeted their state governments to claim access to goods and services that would improve their livelihoods and bolster their economic security.

Workers identified State Welfare Boards as the institutions most able to deliver improved well-being. Welfare Boards are tripartite institutions that provide workers with educational scholarships for children, maternity leave payments and insurance products. The Boards are funded by workers, employers and the government, implemented by state governments and overseen by the central government’s Ministry of Labour. To access the benefits offered by the Welfare Boards, workers require some type of formal identification as a ‘worker’, but do not need to be able to identify their employer. Political struggle therefore shifts away from a focus on employers and onto politicians who are pressured to implement the welfare boards: “we always sit outside some parliament buildings to make sure those fat government officials give us what we need. There is no use going to the employers. They are all thieves. They don’t admit we work for them. They will kick us out of our jobs if we ask for anything. But the government cannot kick us out of the country for making demands!”, as one bidi union member states.

This kind of formal political agitation demonstrates informal workers’ identity as a distinct class with a particular set of interests produced by their structural location within the Indian economy.

Agarwala argues that informal workers choose formal politics as an organising strategy because the state is a relatively stable subject compared to the illusive and indirect employee-employer relationship that defines informal relations of production. This may be the case. But the identification of state governments as the subject of informal worker organising also coincides with a shift in policy focus at the national level. Over the past decade the Indian Union (central) Government has been actively engaged in promoting the social security of informal workers and their households. Recent social security provisions such as the Unorganised Workers Social Security Bill 2008, the Right to Education Act 2009, and the Mahatma Gandhi National Rural Employment Guarantee Act 2005, indicate the priority the central government is currently giving to legislative approaches to social security for informal workers. The extension of state-led social protection measures for informal workers has created a unique political environment at the national level. No doubt this has shaped the strategic planning of informal worker unions and supported their identification of state governments as viable targets for collective action.

In targeting the state as the subject of their claims for social protection and decent work conditions, women workers position themselves as ‘citizen-workers’, not ‘employees’. Prioritising their status as citizens, workers organise and agitate through the formal political channels of the state rather than through more traditional processes of industrial bargaining with employers. Foregrounding their status as citizens the women emphasise their voting power and use this as a bargaining tool in their negotiations with the state. Electoral power becomes the source of informal worker bargaining power.

Agarwala develops a clear and rational explanation of how the structural dynamics of economic informality lead informal worker movements in the three study states to redefine themselves as ‘citizen-workers’ and how this alternative identity produces a novel form of class politics that articulates the class-based interests of informal workers within the formal political arena. The shift in worker identity and priorities is well established and clearly understood by union leaders: ‘labourers are not interested in fighting for wages anymore. They are more concerned about human rights issues, such as education, malaria, safe child delivery, and isolation’.

India2Agarwala’s analysis of informal workers as a distinct class with a unique set of interests is presented in the book as a particular feature of the neoliberal development model pursued by the Indian state since the early 1990s. This approach to economic policy is said to shape the relations of power that define the formal politics of informal worker struggle. This is a salient observation but one that must be contextualised if we are thinking about translating the organising lessons of Indian informal labour within the broader global context of expanding informality and the rise of the precariat. The informal economy has always dominated the Indian economic landscape. Informal workers have always received very low wages, experienced acute exploitation, insecurity and vulnerability. Informal workers have never enjoyed social protection or economic security. Neoliberal policies are not the cause of economic informality in India. The neoliberal shift has, however, reshaped the national development model in ways that further entrench and expand economic informality. At Independence, India explicitly pursued a socialist economic model. Since the mid-1980s, however, this approach has been gradually replaced by a policy framework that promotes liberalisation of markets and privatisation. In some sectors the Indian state and its economic power has been in retreat, in others the state has moved to extend its reach through such institutions as the welfare boards. This has provided informal workers with new and perhaps unexpected opportunities to secure social protection and welfare. Where the neoliberal state is not delivering secure employment it appears willing to deliver basic social security.


Agarwala finds that the strategies informal workers use to seek improvement in their work-lives are similar across the states of Tamil Nadu, Maharashtra and West Bengal, no matter what sector workers are employed in, or the state’s respective level of economic development. What does vary, however, is the effectiveness of worker struggle. Agarwala shows through detailed empirical work that the social base and electoral context of party politics, along with the extent to which states are pursuing economic liberalisation, delivers different levels of success for informal worker movements across the different states.

The political economy of Tamil Nadu has been well suited to the claims of informal workers who have framed their interests in ways that connect directly with the electoral interests of politicians, offering their vote in exchange for specific welfare benefits—including drinking water, health care, education and housing. This relationship has matured in recent years and Tamil Nadu is a leader in welfare board development with management and implementation of the welfare boards for informal workers one of the state top priorities. The strong support provided to informal workers by the Tamil Nadu state government through the Welfare Boards is not reflected in either Maharashtra or West Bengal. Agarwala shows this is because the ruling political parties and prevailing political culture in both these states are not as pro-poor in their orientation as in Tamil Nadu. That is to say, informal workers’ votes are not so keenly courted by politicians.

CPMIn Maharashtra the business class have recognised the needs of informal labour and some support for workers has been won through union-based provision of welfare benefits. The state, however, has been less willing to respond to the claims of citizen-workers. In Maharashtra the significance of the work performed by informal workers is not considered as crucial to the state’s economic development as it is in Tamil Nadu. However, it is in West Bengal that informal worker organising has been least successful. This may seem counter-intuitive given the long rule of the communist party in this state. West Bengal is a curious case. Under the Communist Party Marxist (CPM) the state government was known for its anti-liberalisation stand. Instead it looked to its traditional rural power base to maintain power and in doing so showed scant regard for urban workers and their issues. As an old party with an entrenched organisational structure and rural base, informal workers were unable to interest the CPM in their work issues or successfully advocate for social protection. The voting power of urban informal workers was not seen as significant by the CPM and their resistance to liberalisation meant their attention was focused on the traditional industrial sector. The change in government in the early 2000s has seen some shift in the attitude of the West Bengal state towards the political status and claims of informal workers, but significant successes are yet to be won. Agarwala concludes that the key to informal worker’s organising success against the state lies in the extent to which state governments perceive informal workers as an important source of electoral power. Where state governments are pro-poor, informal worker unions have a better chance of winning welfare benefits from the state.


Contextualising her empirical findings within the broader framework of neoliberalism and economic development, Agarwala argues that public action to extend state-based welfare to informal workers forms the material basis of a new social contract that effectively ‘re-embeds’ workers within the Indian economy. Successful worker struggle is determined, she argues, by a grand bargain between informal labour and the state: informal, low paid, flexible labour (required by capital) offer their political support (votes) in exchange for state-backed welfare benefits. While it is easy to understand why informal labour might accept the terms of this exchange, especially where there is no prospect of formal employment, Agarwala argues that the reason behind the state’s emerging interest in providing welfare benefits for poor informal workers lies in the dynamics of contemporary global capitalism. As India integrates into the global economy Agarwala suggests informal workers are being increasingly positioned as ‘ideal workers’—a low-paid flexible work force at the command of capital. No longer the pariah of economic development, informal labour is now conceptualised as an essential feature of 21st century capitalism. This is a neat and interesting theory—although not one I am inclined to agree with.

Recognising the existence, dominance and growth of informal workers, and the economic value they produce, does not equate with ‘ideal worker’ status. The Indian state produces conflicting messages about informal work and employment. On one hand they are perceived as a pool of highly flexible workers who seek only low wages and little protection. On the other, there is growing acknowledgement amongst policy makers that the poor quality of informal employment undermines economic growth and development. In this approach, decent work is positioned as the driver of inclusive growth and development. Government planning documents do not idealise informal workers. Instead they recognise the dominance of informal labour and propose economic policy measures to support improvements in worker productivity, employment opportunities and economic security. Education, vocational training, manufacturing policy, labour market programs and social protection are all positioned as promoting decent work. This has been the view of recent Congress-led governments.

How we understand the provision of minimal welfare benefits in light of the more rigorous analysis of the problems associated with informal employment contained within official documentation is difficult to determine. Policy to increase formal employment has not been seriously considered in recent years and runs against the dominant tide of liberalisation and globalisation. Perhaps the welfare approach is just the most politically expedient response to the growing agitation by a range of vulnerable and disenfranchised workers who have not benefited from the high growth era. However, with the recent change of government and accompanying pro-business rhetoric, the approach to informal labour may indeed begin to align more closely with Agarwala’s notion of an ‘ideal worker’. In this case there could well be more welfare benefits to be won by informal workers as part of the neoliberal bargain.


This book is rich in empirical data and Agarwala uses her detailed account of informal worker organisation to vigorously argue that feminist and class theory provide critical analytical frameworks for understanding the diversity of the work-life experience and new forms of worker resistance in the neoliberal era. Globalisation is continuously transforming the structures of production, distribution and consumption in India as well as other economies in South Asia, Africa, Latin America and the OECD. Agarwala’s research adds to a growing body of scholarship that demonstrates that this transformation produces new forms of worker organisation that are class-based, driven by and developed around the shared experience and unique interests of marginalised and vulnerable workers. In this sense, informal worker movements are positioned as she argues as ‘a Polanyian movement to counter both the failure of formal labour movements to encompass them and the intention of neoliberal policies to avoid them’. If the state won’t use labour law to ensure informal workers are paid a decent wage that allows them to reproduce themselves, then workers claim the state must provide compensation through the development of a set of welfare benefits that reduces the cost of reproduction. This strategy leaves capital and the market economy free to organise in ways that will maximise global competitiveness and economic growth, leaving the neoliberal state to secure human development. How this works out for the hundreds of millions of informal workers around the globe is a question in need of urgent investigation.

Elizabeth Hill
Elizabeth Hill is a Senior Lecturer in the Department of Political Economy and Chair of the Department of the Political Economy as well as co-convenor of the Australian Work and Family Policy Roundtable.

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