Why is the Indian economy largely informal

India holds the sad top spot for child labor

In the state of Maharashtra alone, around 200,000 children and their families set out for the western parts of the country during the harvest season to work on sugar cane plantations. They seldom know what to expect. They are mostly housed in makeshift, unworthy accommodation near garbage dumps, where they lack essentials such as water, sanitary facilities, electricity and medical aid.

Whole families with their children - mostly over six years old - cut and stack sugar cane during harvest time. They work an average of 18 to 22 hours a day and hardly get any sleep because they have to stay awake to load and unload the sugar cane. There is little to eat as the women are overtired and have no time to cook. The gender roles are clearly divided: boys have to do heavy work in the fields for 12-16 hours a day, girls do the housework, look after the small children and go to the fields to relieve their mothers, who also help with the harvest.

A sophisticated and exploitative system of debts, credits and prepayments forces families to migrate and do forced labor. They have no alternative because there are no jobs in their villages and towns. Seasonal migrant work is the only way to pay off debt and save some money.