Is this a Crucial time to Shift to “Living Wages” from “Minimum Wages” to Address Poverty in India?

Poverty has serious implications for the social and economic growth of the world. In times of globalization, poverty in one region is a hindrance to the growth of the rest of the globe. Being a house of more than 1.4 billion population, and the largest poor population of more than 228 million in the world, India experiences a real challenge to address the issue.

But still, it is striving aggressively to move ahead through a policy shift from ‘minimum wages’ to ‘living wages’ through computation of the cost of living in the country including their housing, food, transportation, social security and other basic needs. India even in the unprecedented times of Covid 19 had served its poor population well and that helped it to keep a check on the poverty levels during the tough times also. The efforts have been appreciated by the United Nations (UN) and the International Labour Organization (ILO) time and again.  

Now, India has widened its horizon to achieve the Sustainable Development Goal (SDG) to eliminate extreme poverty levels in the country by 2030. As the living wages are indexed to inflation and the Government of India is trying to set the minimum income of workers to meet the necessities of their life and live a comfortable life in the true sense. The move is coherent with the provision of living wages enshrined in article 43 of the Constitution of India which directs the government to secure living wages for the workers that can help them to maintain a decent standard of living in their social spheres.

This transformational step is pro-worker and capable of effectively addressing the poverty levels in India once implemented. But, at the same time, this will bring serious financial implications for India’s economy. Thus, the government is looking for receiving financial assistance from the ILO along with the theoretical estimations made by ILO member states including India before moving ahead. With a strong political commitment if the idea gets implemented, it is capable to accelerate India’s fight to eliminate poverty manyfold and clearing the path of developed India in the time to come.