Public Sector Restructuring and Democracy: The State, Labour and Trade Unions in India

This article looks at the ways in which marketisation reforms affect the empowerment, ideological universes and functioning limits of popular institutions. Under what circumstances do left-leaning trade unions accept job cuts and wage freezes? What are the boundaries of consent and dissent? Case studies of three public sector companies in Bangalore city in the southern state of Karnataka, India, indicate that labour rationalisation has occurred with trade union acquiescence and support. However, as yet there is no broad institutional framework to handle social security, rehabilitation and redeployment of displaced workers. Public sector workforce reduction is taking place in a general economic context where there has been little growth of employment in the organised manufacturing sector. Beneath unions' apparent acquiescence to rationalisation processes, there are critical areas of dissent. Dissent, however, has not manifested itself in a critical alternative to the state's rationalisation policies. Changing party-union relations, and shifts in the internal dynamics of unions affecting choice of leaders, union aspirations and ideologies - underwritten by the broader economic changes wrought by the marketisation process - partially explain the inability of the labour movement to shape a definitive challenge to the marketisation process.