Urban Informal Sector in India
Arup Mitra

The urban urban informal sector plays a crucial role in providing sources of livelihood particularly to the rural migrants and several low income households residing in urban slums. This paper examines the relative size and composition of the informal sector and delineates the recent changes relating to contractualisation and ancillarisation and their impact on work practices and performance. Several studies on informal sector have been carried out in the Indian context in last thirty to twenty years or so – a brief review of which may be seen in Das (2011) and Mitra (2013). The rural labourers who are pushed out of the agricultural sector due to the lack of a productive source of livelihood and at the same time could not be absorbed in the rural non-farm sector or the high productivity manufacturing sector in the urban areas are likely to get residually absorbed in the low productivity urban informal sector (Mitra, 1994). Also, a rapid natural growth of population in the urban areas has been adding substantially to the urban labour supplies. Despite a rise in enrolment ratio, a large component of this labour force is either of unskilled or semi-skilled variety. Contrastingly, the growth process is becoming increasingly capital and skill intensive, forcing many to pick up petty activities in the informal sector.