Kranthi Nanduri is a Doctoral Student in the Economics Group at Indian Institute of Management Calcutta (IIMC), Kolkata, India. She works in the areas of Agrarian Political Economy and Regional Political Economy. Her doctoral thesis explores trajectories of non-agrarian informal accumulation in India from the standpoint of agrarian change. Ms. Nanduri completed her Integrated M.A in Social Sciences with a specialization in Economics from Hyderabad Central Univeristy (HCU). She served as student representative in Committees Against Sexual Harassment at IIMC and HCU. She runs an online channel ‘Radio Sofia’ for discussions on socioeconomic and political issues.
Variations in the nature of informality in India: A view from the standpoint of accumulation
This paper studies variations in the nature of informality in Indian economy. It attempts to locate variations in the nature of non-agrarian informality within the broader accumulation processes. Mainstream approaches argue that, if supply-side constraints are eased, the duality between formal and informal enterprises gradually disappears. A strand of Marxian approaches (Kalyan Sanyal etc.,) describes the process of capital accumulation as an endogenous mechanism of reproducing formal-informal duality. Neither frameworks conceive informal enterprises as sites of accumulation. As a departure, this paper using the Petty Commodity Production Approach discusses how the differentiation within informal enterprises driven by the process of capitalist transformation may or may not allow transition to expanded reproduction. It suggests that there can be no apriori assumption that informal enterprises cannot be sites of capital accumulation and whether or not they are is a function, at least in part, of the nature of agrarian transition. Critical Agrarian Studies (CAS) scholarship mainly focuses on the impact of agrarian transition on the nature of rural and urban class formation within non-agrarian labour. However, it’s impact on the nature of organization of production and the formation of different types of informal enterprises remains understudied. This paper hopes to contribute to CAS literature with an initial foray into the latter aspect. Major Indian states are divided into four groups based on per capita income and convergence (or divergence) between agricultural and non-agricultural productivities. We find that the productivity of non-agrarian informal sector enterprises in rich states is significantly higher relative to the poor states. Among poor states the differentiating factor is urban non-agrarian informal productivity whereas among rich states it is rural non-farm sector productivity. This implies that in rich states higher agricultural productivity is key to productivity and output growth of rural non-farm sector. The paper mainly uses the data from Government of India’s National Sample Survey (NSS) on unincorporated nonagricultural enterprises (67 and 73 rounds), employment and unemployment surveys (61 and 68 rounds) and Periodic Labour Force Survey (PLFS 2017-18).
Affiliation: Indian Institute of Management, Calcutta