Terms of Trade | What explains the predicament of the trade unions in India?

To put the “hundreds of millions” number in context, it must be reiterated that India’s total labour force (number of persons who are either working or looking for a job) was 549.2 million strong if the 2019-20 Periodic Labour Force Survey (PLFS) estimates are used with mid-year population projections available in National Account Statistics (NAS). The non-agricultural workforce, as expected, is much lower, an estimated 284.5 million. If even one-fourth of India’s non-agricultural workers had gone on strike, normal life would have been thrown out of gear.

Irrespective of one’s views regarding actions such as strikes, most people would agree that trade union calls such as this week’s strike evoke a relatively tepid response and very little public sympathy in India, except in regions where the communist parties are strong (such as Kerala) or sectors where formal sector workers still have strong trade union presence (such as public sector banks) .

Lest unions and their supporters argue that this apathy is a result of unfavourable media coverage and anti-worker bias in the society, it needs to be said that public support, including coverage in the media, is much bigger for other forms of class action such as farmers’ protests (for example the Long March to Mumbai in 2018 and last year’s farmers’ protests against the now repealed three farm laws) or the recent students’ protests against delay in fulfilment of vacancies in the Indian railways.

To be sure, trade unions have seen better days in India, but that was in the pre-reform era.

What explains the current predicament of the trade union movement in India? Most people would agree that a large section of the Indian population is actually facing what can be described as precarious economic conditions. Growth rates were going down even before the pandemic triggered a contraction, urban unemployment rates are still higher than pre-pandemic levels, consumer confidence continues to be significantly below pre-pandemic levels, and rising inflation is bound to have increase the economic pain going forward. Why are people not rising in rebellion against the government, as the unions would like them to?

The constituency which the trade unions would like to capture can be broadly classified into two parts — a small (but numerically significant) section which actually enjoys much better work conditions in the formal public sector, and a vastly large group of informal sector workers and the unemployed who want to join the ranks of the former group or parity with them but are not able to.

How big is the second group in the Indian economy? Numbers from the last economic census – it was conducted in 2013-14 – can give us an idea. They show that 95% of India’s economic establishments had between one and five employees. This statistic has profound implications for the feasibility (or lack of it) of trade union activity in the classical sense where hundreds or thousands of workers organise themselves against a big capitalist.

If one were to use Marxist jargon, the class-enemy for a large section of the Indian proletariat is actually from the ranks of the proletariat itself. Given this fact, it is hardly surprising that workers feel little enthusiasm to practice militant trade unionism in their day to day lives.

Does this mean that working class politics has no future in India? Far from it. Politics is always the art of the possible. The biggest reason for the weakness of the trade union movement in India is the humongous size of what Karl Marx would have called the reserved army of the unemployed and underemployed. Every policy which reduces its size, both in qualitative and quantitative terms, will tilt the balance of class forces in favour of workers in the Indian economy.

The unions are primarily trying to do this by pushing back against steps such as privatisation of public sector companies. Whether one agrees with such demands or not, it can be said with some degree of confidence that the impact of such struggles on India’s overall reserve army of labour is unlikely to be significant. What also needs to be underlined is the fact that maintaining status quo in entities such as public sector banks is going to be increasingly difficult as they have been losing their business to their private sector peers. Using the taxpayer’s money to keep cross-subsidising these operations is a difficult policy to justify given the fact that the beneficiaries would be the most pampered section of India’s workers.

There are no easy answers to these questions. To be sure, the problem is not something which has arisen today. John Maynard Keynes, perhaps the greatest economist of the 20th century, described this dilemma facing the communists beautifully in his 1926 essay Liberalism and Labour.

“The political problem of mankind is to combine three things: Economic Efficiency, Social Justice and Individual Liberty…The second ingredient is the best possession of the great party of the Proletariat. But the first and third require the qualities of the party which, by its traditions and ancient sympathies has been the home of Economic Individualism and Social Liberty”, Keynes wrote. India’s trade union leaders would do well to mull over Keynes’s words.

Every Friday, HT’s data and political economy editor, Roshan Kishore, will combine his commitment to data and passion for qualitative analysis in a new column for HT Premium, Terms of Trade. With a focus on one big number and one big issue, he will go behind the headlines to ask a question and address political economy issues and social puzzles facing contemporary India.

The views expressed are personal