The Municipal Corporation of Varanasi has reported a population of 1,100,748 as per Census 2001. Out of 359,761 workers in urban Varanasi, 115,229 (33 percent) have been reported as household industry workers, a substantial number in comparison to other urban centres in Uttar Pradesh (U.P.). Census defines household industry as an industry conducted by the head of the household himself/herself and/or mainly by the members of the household living in urban areas; that does not operate as a registered factory and relates to production, processing, servicing, repairing or making and selling (but not merely selling) of goods. Urban centres like Ghaziabad and Gautam Budha Nagar in U.P. have reported only 18731 (3.8 percent) and 4017 (2.7 percent) household industry workers, respectively. There were 239,088 workers listed as ‘other workers’ in urban Varanasi, among whom could be many ‘self-employed in informal enterprises’ and ‘casual workers in informal jobs’. No big public or private manufacturing enterprise has yet set up a base in Varanasi. This preponderance of informal economy makes Varanasi distinct. Varanasi is a city of informal economy workers.

Who are the informal economy workers of Varanasi? Do the informal sectors in Varanasi have the same organisation of production and offer similar services to those existing in other parts of the country? Is the informal sector in Varanasi linked to the organised sector or the external market; if so how? What are the living and working conditions of the informal economy workers in Varanasi?

This issue of Labour File is an attempt at journalistic exploration of these important questions. Our objective is to raise questions and draw the attention of labour organisations, academics and policy makers to the problematique; and not to seek definitive answers. Labour File has highlighted four economic activities that give Varanasi its recognition in time and space, for symptomatic investigation. Two of these are craft based occupations – Zardozi and Haathari embroideries and silk weaving, whose products are in great demand in national and international markets; and the other two occupations are - boating and cremation – both based on Ganges, the river which gives Varanasi its prominence as a tourism attraction and a highly revered pilgrim destination.

The informal sector workers in Varanasi share the same characteristics as those in any other part of the country. They are not recognised or protected under the legal and regulatory frameworks, and do not have secure contracts or worker benefits. They are unable to enforce contracts or have security of property rights and they experience a high degree of vulnerability. They are not organised for effective representation and have no voice to make their work recognised and protected. They have limited access to public infrastructure and benefits. Their employment is highly unstable and their incomes, very low and irregular. They, in particular the homebased workers, are placed at a competitive disadvantage because they mostly engage in tied production or work for the untied producers in which case, the price of their commodities are determined by traders. They have no access to institutional arrangements for information on markets, credit or skill development. The self-employed are at the mercy of the public authorities and experience social exclusion.

However, Varanasi defies certain prevailing notions about informal economy. Varanasi’s informal economy has not developed in relation to or as an adjunct to large industrial centres, making the complimentarity between formal and informal sectors hazy. The manufacturing enterprises in Varanasi, though are linked to national and global markets, are probably not part of cross-border commodity and value chains controlled by lead firms or large retailers in an advanced industrialized country. Women workers in the Zardosi and Haathari embroidery are not allowed to enter into a contract or to work in ‘karkhanas’, not recognised as workers, receive less remuneration than male counterparts and their quality of work is not acknowledged. The boat workers and cremation workers are discriminated on the basis of their caste identities.

Informal economy workers of Varanasi need recognition, legal protection and social security. They need regular employment, better wages, market access and better prices for commodities. Varanasi is a challenge because it demands perspectives and strategies beyond traditional residual approach to informal economy workers.