Breaking down the question
The question has a definitional core and a country-specific application. First, what do you understand by informalisation of labour asks for a precise concept — not the informal sector as a static category, but the process by which employment becomes increasingly informal, insecure and unprotected. The single quotation marks around the term signal that the examiner wants it defined with care.
Second, with special reference to India is a binding instruction. A general essay on informal work that never touches Indian realities will be marked down heavily. The answer must show how informalisation manifests in India — its scale, its drivers, and its consequences for workers.
At ten marks the task is to define the process crisply, distinguish it from the mere existence of an informal sector, and then ground it in Indian evidence: the overwhelmingly informal workforce, the informalisation of the formal sector through contract labour, and the precariousness this produces.
How to approach it
Define informalisation as a dynamic process, distinguishing it from the informal sector as a place. The labour and society notes supply the conceptual background on formal and informal work and its Indian dimensions.
Then turn to India in earnest. Note the scale — the vast majority of the workforce is informal — and, crucially, the informalisation of the formal sector: the spread of contract, casual and outsourced labour within organised enterprises to evade regulation. Set out the drivers (liberalisation, cost-cutting, weak enforcement) and the consequences (no job security, low wages, no social protection). Conclude on its significance for inequality and for India's development.
Model answer
Meaning. Informalisation of labour refers to the process by which an increasing share of employment comes to lie outside the protection and regulation of formal labour law — work that is insecure, poorly paid, and without job security, written contracts, or social benefits such as provident fund, pension, paid leave or insurance. It is important to distinguish informalisation as a process from the informal sector as a category: the informal sector denotes unorganised, unregistered economic units, whereas informalisation names the dynamic trend by which labour, including labour within formal enterprises, is progressively stripped of protection. Informal workers, in this sense, exist both in the informal sector and, increasingly, inside the formal sector itself.
With special reference to India. India presents one of the most striking cases of informalisation in the world.
Scale. The overwhelming majority of India's workforce — of the order of nine in ten workers — is informal, engaged in agriculture, construction, street vending, domestic work, small manufacturing and myriad services, without formal contracts or social security. The formal, organised sector employs only a small minority.
Informalisation of the formal sector. The more revealing trend is the growing informalisation within the organised sector. Since economic liberalisation in 1991, formal enterprises have increasingly relied on contract, casual, temporary and outsourced workers rather than permanent employees, in order to cut costs and sidestep labour regulations on wages, security and dismissal. A large and rising proportion of workers in registered factories are now informal in status, doing the same work as regular employees but without their protections. This is sometimes described as "informalisation of the formal".
Drivers. The process is propelled by liberalisation and global competition, employers' pursuit of flexibility and lower costs, weak enforcement of labour laws, the surplus of labour that depresses bargaining power, and the recent expansion of platform and gig work.
Consequences. Informalisation leaves workers without job security, exposed to arbitrary dismissal, low and irregular wages, hazardous conditions, and no access to institutional social protection. It weakens trade unions and collective bargaining, deepens inequality between a small protected core and a vast unprotected periphery, and leaves workers acutely vulnerable to shocks — as the mass distress of migrant informal workers during the COVID-19 lockdown vividly exposed.
Significance. Informalisation of labour thus captures a central paradox of India's growth: rising output and a modernising economy accompanied by the persistence and even expansion of precarious, unprotected work. It poses a fundamental challenge for social policy — extending security and dignity to the informal workforce through measures such as social-security codes and welfare boards remains one of the country's most pressing developmental tasks.
Examiner's perspective
The examiner is testing conceptual precision and Indian grounding in equal measure. The commonest error is to treat informalisation as simply "work in the informal sector", missing that it is a process and, above all, missing the informalisation of the formal sector through contractualisation. Candidates who capture that dynamic have grasped the heart of the term.
The instruction with special reference to India is non-negotiable. Strong answers cite the scale of India's informal workforce, connect the trend to post-1991 liberalisation and contract labour, and note concrete consequences such as the absence of social security and the migrant-worker crisis of 2020. Precise, India-anchored evidence rather than generic assertion is what earns the marks in this compact question.