ISAS Working Papers

This paper is an attempt to understand the key opportunities and challenges to Indian labour in the new economy. India is today a favourite destination for outsourcing of service sector jobs, particularly in the IT sector. There are also encouraging reports about India's growing expertise in high-technology industries. However, the concerns are many. The jobs created in India in the IT sector - estimated to reach 2.4 million in 2008 - are not large enough to make a dent in the problem of unemployment and underemployment that the country faces. It is feared that multinational companies will corner the bulk of the benefits from the new economic changes, including outsourcing, and this will further erode the bargaining strength of labour globally. The rules for international trade, particularly the Trade Related Aspects of Intellectual Property Rights agreement, have produced undesirable outcomes on firms and the poor in developing countries. They have already triggered unprecedented levels of rural distress in many parts of India; they also threaten India's growth prospects in technology-intensive industries.