KEY POINTS

·        India’s urban transformation is taking place at a 100-times faster pace than what developed countries have experienced.

·        India is also the youngest country in the world, riding a wave of youth bulge that will continue to add 10 million additional workers to the labor force every year for decades to come.

Tax reforms, demonetisation and financial stress

·        While the goal of Goods and Service Tax reform is commendable, its hasty implementation has adversely impacted small entrepreneurs in the informal sector.

·        It has broken the link between formal and informal sectors. Large enterprises that outsource a lot of tasks to small enterprises are now less inclined to outsource it to the informal sector that barely come under the GST net.

·        The informal sector has been badly affected by the economic slowdown and much of this may not be captured in official statistics.

·        Insolvency and bankruptcy reforms are important and needed for more efficient resource allocation. But it is not of a great consequence to the informal sector.

·        There is mounting evidence that economic shocks that worsen infrastructure affect informal sectors by reducing their access to markets and basic services.

Policy agenda

·        The FM could explicitly recognise the role of informal sector as an important driver of growth and job creation in the next Budget.

·        While the agenda on smart cities has caught the attention of policy makers, it needs to be made more inclusionary by integrating the informal sector into city planning, budgeting and financing.

·        Technological revolution has made the informal sector as partners in development.

·        Smartphones have become the key tool for women entrepreneurs, putting instant information about safety alerts, traffic, tourism, health services, and community news into millions of hands. 

Please review 

Please review