Social change through self help groups
The most visible yet the most overlooked, poverty-stricken and unaccounted for ‘workforce’ is the informal sector. This segment included the self-employed.
Kavitha Sold Fruits and flowers for a living. She lived in Adyar, Chennai in a run-down shack and plied her wares between her home and Besant Nagar. She earned Rs 300 a day, with which she ran her household, fed her children and paid their tuition fees. Her husband had died several years ago. One day, the rains in the area were torrential. Not only did Kavitha not have any earnings that day, but she went home drenched only to find her little shack almost swept away.
Kavitha belongs to the informal economy of India, which offers no guarantee of employment, no insurance, no coverage for other basic amenities.
The informal economy contributes to about 90 per cent of India’s workforce. Over the past 50 years, there have been several efforts to document this workforce by organizations, including NGOs and social activists.
TO ENSURE SUSTAINED WORK…
To get at least a portion of the informal sector into more sustained work, the following policies need to be implemented:
Entrepreneurial systems of activity are hard to come by. However, some systems can be successfully built but need to be systematically nurtured.
Entrepreneurship is here to stay. Many in India, including the state, private sector and civil society, need to look at building capacity, at entrepreneurial initiatives for the poor. Additionally, agencies should work seamlessly to build and sustain entrepreneurial capabilities. Efforts of the government alone will not lead to poverty alleviation.
SELF HELP GROUPS (SHGs) SIZZLE…
One such example of a solid, time-proven entrepreneurial ecosystem is the SHG in India. They have shown excellent social dynamics and have worked with leading banks and financial institutions to become healthy and profitable.
The SHGs did not take much time to show successes in rural areas and women’s empowerment. But, that said, the growth of SHGs has not been even across India. For example, the more prosperous states in India have much more robust results.
Mark it, the SHG mechanism is less of a financial beneficiary programme and more of a profound social change programme. Members participate as equals and therefore many other development goals are being looked at, including goals like hygiene, environment, water supply…
The programme’s achievements have been circular: they have created job opportunities for rural players and seeing this success, more financial players have joined the fray.
Apart from entrepreneurship and more support to SHGs, specific policies have to be followed until the informal sector can at least partially move into the formal sector. Gender economics needs to be included fully with national economic systems. Gender equity and equality help the economy in multiple ways. For example, gender equality promotes economic growth, women in the workforce give access to better education and employment. Household poverty also comes down.
The impact of structural adjustment policies, recommended by the World Bank and the IMF, on the informal sector can be dealt in a separate feature.
By AnuOza
The author holds graduate degrees from Harvard and the London School of Economics and has served as a guest lecturer at Harvard and the Columbia Business School. Currently, she heads talent management in a reputed automotive company in Chennai.
