Child Labour and the Informal Economy of India: A Legal Study

Abstract

Background - This paper examines the role of informal economy in increasing the child labour cases. It seeks to determine the reasons behind the rise of informal economy. It sheds light on the fact that, in the world economy there are number of informal activities that contributes at a big scale. Approximately 60 per cent of the total employed population of the world is working in the informal economy. Studies have shown that close to 33 per cent of the total world economy is informal economy. It argues that current legal standards do not provide protection to a worker in the informal economy. On one hand the formal sector is completely regulated, however, on the other hand, informal sector is completely overlooked by the regulatory environment. The paper concludes by recommending that it is necessary to ensure that the informal economy gets formalized, so that it becomes easier to look after it by the regulating authorities, and workers get the much needed legal protection. That can be done by including the registration and taxation procedure.

Methods – Using a doctrinal research methodology, the paper analyses, statutory frameworks, and scholarly literature.

Results – The study shows that informal economy has played a big role in increasing the number of child labour cases in India. There are several reasons for that, weak regulation, and the widespread availability of undocumented and low-cost labour are some of the most important reasons. Further study reveals that gaps in the child protection laws in India and family enterprises also leads to the increase in the child labour instances in India. Although India has enacted comprehensive legislation, including the Child and Adolescent Labour (Prohibition and Regulation) Act, 1986 (as amended in 2016), the Right of Children to Free and Compulsory Education Act, 2009, the Juvenile Justice (Care and Protection of Children) Act, 2015, and the Bonded Labour System (Abolition) Act, 1976, their effectiveness remains limited within the largely unregulated informal economy. The findings demonstrate that the absence of formalisation and effective monitoring continues to hinder the elimination of child labour and perpetuates adverse educational, social, and health outcomes for children.

Conclusions – It is necessary to formalize the informal sector of India by providing the necessary legal protection to the people through law. In that way the child labour instances in the informal sector will reduce.