Address by Shri K.C. Pant, Deputy Chairman, Planning Commission at Public Lecture by Mr. Juan Somavia, Director General, ILO on "Decent Work in the Global Economy" organised by Ministry of labour on 18^th February, 2000 at Vigyan Bhavan

I am glad to be here amongst you at this function organised by the Ministry of Labour to welcome Mr. Juan Somavia, Director General of the ILO to India. Mr. Somavia’s presence here symbolizes the active engagement of the ILO and the Government of India which has been continuing from the very inception of the ILO. India is a founder member of the ILO and the Indian Tripartite Delegations have been playing an active role in the work of ILO especially in the standard setting activities.

Developing countries like India are confident that, given his background, Mr. Somavia will approach their problems with understanding and sensitivity. Mr. Director General, your report entitled "Decent work" at the 1999 International Labour Conference is, indeed, a thought provoking document. The key issues relating to workers have been presented in a social perspective. What is more striking is that ILO is now reaching out to a wider constituency of workers which, I am sure, reflects your personal direction. I am happy that apart from the needs of wage workers – the majority of whom work in formal enterprises - the ILO is concerning itself with all workers, recognising that the former is only a part of the mandate of the ILO, and only a small part of the world of workers.

We share Mr. Somavia’s hope in realising the objectives and the priority directions he has referred to in his theme of decent work. Today, Mr. Somavia will be addressing us on the theme "Decent Work in the Global Economy". The issue of promoting opportunities … to obtain 'decent and productive work' has become central. The goal is not just the creation of work opportunities, but the creation of jobs of acceptable quality. This theme has profound relevance and implications for our national economic and social policies.

In India, we are presently going through a phase of demographic transition. The rate of growth of the labour force is expected to reach a peak level of 2.5% per annum during the period 1997 to 2002, which is the Ninth Five Year Plan for India. This implies an annual addition of 10 million persons per annum to the labour force. This demographic phase offers a window of opportunity as the dependency ratio is projected to decrease quite sharply. But in order to seize this opportunity, we have to ensure that the emerging work-force is gainfully employed. The challenge therefore is to first ensure that we create work opportunities which are consistent with the skill profile of the labour force, and then to improve the skills and knowledge base for sustained growth in employment and incomes. Against this background, the Planning Commission has set up a Task Force to recommend measures for the promotion of avenues of employment in a big way.

We recognise the need to create conditions for decent and productive work for a work force of around 400 million persons and this we seek to achieve in a democratic set up with a commitment to continue, unhindered, the internal migration of labour. The social and political environment permits regional adjustments within the country, but the distribution of skill and knowledge imposes certain constraints on the evolution of the structure of the economy. In particular, we believe that the agricultural and informal sectors will have to continue to play a substantial role in our efforts to provide work opportunities.

The dependence of the workforce on agriculture is no doubt declining, but given the growth of the labour force and a feasible pace of transition of the economy away from primary sectors of production, agriculture will have to continue to provide work opportunities to around 60 per cent of the work force, in the near future. However, the picture is not uniform. In some parts of the Country, this dependence on agriculture and allied activities may be as high as 70%, and increasing in the short term.

In India, we have sought to address the improvement in the lot of agricultural workers through strategies that increase productivity of land, sustain prices of agricultural produce, maintain price of food and other basic items in the consumption basket, provide supplementary income opportunities during the lean work period, and a regulatory framework for ensuring a floor level of wages together with a policy to support labour cooperatives. But the complexity of these issues surrounding agricultural labour and the self-employed requires further consideration.

In this context, I feel that international labour and employment perspectives have continued to treat the issue of labour in agriculture as a residuary sector. In the contemporary discussions on labour issues, the institutions that can provide social protection, promote social dialogue, augment decent employment opportunities and ensure rights at work to agricultural workers have not attracted sufficient attention. In particular, small and marginal farmers who also work as hired labour present certain issues which have so far not been addressed at all.

Apart from the agricultural sector, there is substantial and growing employment in the informal sectors of the small-scale and village industries, especially in the Handloom and Handicrafts sectors. A Task Force in the Planning Commission is at present looking into various aspects of this sector, especially in view of the fact that perhaps some of the protection and reservations offered to these units may not continue once the WTO stipulations come into effect. In India, the informal sector is full of over-worked and under paid people, and we welcome your approach that ILO must be concerned with workers beyond the formal labour market – with unregulated wage workers, the self-employed and home-workers.

This brings me to touch upon another issue of great importance to us. There has been considerable discussion of linking the implementation of core labour standards with trade measures; an issue that is euphemistically referred to as the "Social Clause". That this is an emotive issue is evident from the recent experience at Seattle. A cool-headed response also suggests to us that linking trade restrictions with implementation of core labour standards would be a dangerous step, with the negative implications of protectionist action, which would fall disproportionately on the poor in developing countries, far outweighing any possible effective improvement of the situation for labour in the developed world. This is particularly because of the immense room for differences in interpretation and opinion once the door for trade restrictions is opened in this context, a situation that is amply evident with the experience of anti-dumping and anti-subsidy trade measures in different countries.

This however, does not mean that India, the most populous democracy in the world, does not emphasise core labour standards. But we believe that labour standards need to reflect the social and economic realities that are present in every specific country. Taking this position we have, in fact, evolved a wide spectrum of enlightened labour standards ranging from child labour to bonded labour, from industrial labour to the agricultural landless. These standards reflect our social and economic conditions and also our ethical and moral values. It would be too much to assert that there exist certain levels of standards, which are completely divorced from the specifics of cultural values and economic realities.

As considerable evidence and experience has shown, this is a complex issue and needs to be tackled not only with determination, but also with understanding and co-ordination of various social policies. India places great emphasis on this matter, and will continue to address it meaningfully. Attempts to impose impractical time schedules or threshold levels of achievements do not help matters in this regard. Nor does any attempt to impose, unilaterally or multilaterally, standards that are open to protectionist pressures. That would show a lack of understanding of the situation in developing countries, and would curb rather than assist those who want to improve the situation of their labour.

I understand that Mr. Somavia has played an important role as the Chairman of the Preparatory Committee for the Social Summit. The Social Summit outcome set the goal of free, freely chosen, productive employment for all. After adopting the Declaration in 1995, the employment situation has not improved except in a few countries who have greatly benefited from globalisation. Therefore, creation of employment opportunities should be the core activity for achieving the objective of decent work. The ILO can play an effective role in the UN system alongwith Brettonwood Institutions for evolving and promoting an employment strategy. This need serious consideration especially in view of the fact that in June, 2000 there is going to be a Review Summit to assess the progress made in achieving the goals set in the Copenhagen Declaration.

Mr. Director-General, it is in this context that your new direction to look at workers outside the wage employed formal sector is indeed very welcome. Perhaps we need to deliberate how the processes at ILO itself may be strengthened to achieve the objectives that we have been discussing today. I hope the research agenda of the International Labour Organization and the negotiations steered by it at various fora will benefit the countries where employment outside the formal sector is very high, and institutions for social protection are evolving.

The Government of India has always cooperated fully with the UN and all its agencies in furthering the cause of a just world order, and I reiterate our commitment to continuing and strengthening this process. The visit of Mr. Somavia to India will definitely facilitate continuation of the dialogue between the Government of India and the ILO. I offer the full cooperation of the Planning Commission to the ILO in its efforts to evolve a development sensitive and implementable agenda for labour standards and social security for all workers. I take this opportunity to welcome Mr. Somavia to India and look forward to receiving his valuable suggestions in his address.