Trade Liberalisation and Its Impact on Employment: An Analysis of Indian Experiences (With Special References of Indian Manufacturing Industries)

This paper explores the underlying factors behind the poor performance of the organized sector in terms of employment generation in the context of trade liberalization. The Indian economy has entered a phase of high growth in the recent years after a long period of low growth. High economic growth means not economic development, therefore the concerns of policy makers seem to have shifted towards making the growth inclusive wherein the generation of employment is at its core. The available pieces of evidence, however, tend to indicate that the high growth has been accompanied by low employment growth in the organized manufacturing sector. Various reasons have been put forward in the literature to explain the observed jobless growth. The observed jobless growth has coincided with an unprecedented increase in the rate of integration of the Indian economy with the world market through trade liberation. Yet, it is surprising to note that the impact of trade liberalization has not received the attention of economists that it deserves in explaining the observed jobless growth.