Gujarat govt unveils policy for unorganised sector

Earmarks Rs 100 crore for its implementation.

In a development that will have a big impact on Gujarat's informal sector, the state government has declared a policy for the unorganised sector.

The policy, a first-of-its-kind in the history of the state, is likely to benefit sectors ranging from vendors to diamantaries. Estimates suggest that the unorganised sector contributes around 62 per cent to the state's GDP and around 40 per cent to exports from Gujarat.

"Around 92 percent of the state's workforce belongs to the unorganised sector. This is one of the primary reasons behind formulating the policy on these lines," minister of state for industries Saurabh Patel told Business Standard.

The state government had earmarked a fund of Rs 100 crore for the implementation of the policy. The fund will be utilised in preparing smart cards, collating data of all workers, providing insurance cover, creating training facilities and for building social infrastructure.

The policy also entails a legislative protection for minimum conditions of work and comprehensive legislation, creating a dispute resolution structure and a minimum social security and an institutional framework for marketing and social infrastructure.

"Our definition of informal sector is private businesses owned by individuals or households engaged in the sale and production of goods and services, operated on proprietory or partnership basis with less than 10 workers. All agriculture activities undertaken on agricultural holdings, either individually or in partnership are considered as being a part of the unorganised sector. This excludes only the plantation sector and other types of organised agriculture (corporate and co-operative farming)," said Patel.

All informal sector beneficiaries will get credit cards, bank accounts, credit at reasonable interest rate preferably the lowest among all the lending rates without security.

The state government is also planning to create raw material banks for the informal sector. "The government is also planning to create hawking zones and licence for street vendors," he said.