I arrived in Chennai on 17 December. The driver who came to pick me up from the airport was late. I remembered that there was this Chennai rains angle to explore. So, I asked him about how it affected him personally.

His story is not a tearjerker but could be worse than that. But such stories are for a different audience. He has a small family and he is the only earning member. His rented portion was flooded as he lived on the ground floor. He moved his wife and four-year-old son to the safety of his native village and he went there too.

He had returned just about five days earlier to Chennai. The walls of the house and the floor are damp. It is not liveable yet. The white and electronic goods that he had acquired a year ago on hire purchase are now dysfunctional. In total, he estimates that he has been set back by ₹ 60,000. Stories like this ought to be more frustrating for the policy planner.

Poor people who continue to live on the edge of India’s urban agglomerations also live on the edge of nature, metaphorically and otherwise. They are hurt. But their real income status goes down only marginally because they had nothing much to lose to begin with. That is not a happy situation but the marginal change is not significant.

Please note that I did not say that it was unimportant. However, what ought to worry policymakers more are the stories like that of the gentleman’s who drove me to the city. These people have climbed above the poverty line but they could step right back below that when natural calamities strike. Of course, big health expenses are the other risk. But some policy alleviation is being contemplated at least with respect to health.

If, as is widely predicted, climate change affects India more than it does other countries, it could deal a bigger setback to the country than merely hurting economic growth. The macro impact is familiar. There is dislocation to businesses, production and economic activity in general. Resources that could otherwise be deployed to create new infrastructure have to be diverted to repair and reconstruction.

The second setback is bigger. The ranks of the poor might swell if stories such as the one I narrated above become more pervasive. They would if climate change-induced natural disasters become more frequent. What to do about them?

One, it appears that it is too late to reverse the damage caused by climate change. It is unclear if Paris did much to deliver hope. Hence, extreme natural disasters might be fat-tailed. Besides improving infrastructure and enhancing disaster preparedness efforts with training and quick responses that could be activated through a clear command structure, the government can do more to improve the shock-absorbing capacity of the people. As long as the bulk of the population remains self-employed and is outside the formal sector with its better safety provisions, it runs a permanent risk of becoming self-unemployed.

Whether the cause is labour laws or regulation or labour taxes, India’s formal organized sector workforce is too small at 30 million whereas the total population is over 1.25 billion. The size of the labour force in the organized sector has to become a lot bigger.

The current members of the organized labour force are acting like members of a guild that blocks the entry of new members. Any legislative change that seeks to make it easy for firms to hire more full-time workers than they are doing now is immediately dubbed anti-worker. In reality, this reaction is anti-labour and it denies India’s poor a chance to get out of poverty. India’s labour unions are nothing if not elitist.

Currently, India has an extremely primitive and fragmented production structure that does not befit its aspiration to become an economic superpower. Economic activity takes place in informal enterprises with very little commensurate economic output to show. There is gross inefficiency. That is why high growth in India will remain an aberration rather than the norm. If this has to change, policy experimentation is essential. Policies can and should be reversed if they do not bring about a qualitative and quantitative improvement in the employment situation, and that is an increase in India’s labour force participation through an increase in the share of organized employment.

Given this backdrop, political parties should unite in supporting policies that break the resistance of labour unions to labour policy changes. Instead, the Congress party’s Rahul Gandhi gave a speech to the labour unions earlier in December, promising them full support in their opposition to the government’s well-meaning (even if only incremental) labour reform proposals.

He even came up with an amazing theory that Indian workers were insecure and hence unproductive. The insecure are those who are self-employed as the narrated story reminds us. Organized sector workers are relatively more protected, more secure and hence, ought to be more productive.

If the leader of India’s grand old party champions a regressive agenda, then India’s premature deindustrialization will be impossible to reverse. The party, it appears, is pro-poverty and not pro-poor.

V. Anantha Nageswaran is an independent financial markets consultant based in Singapore.

Comments are welcome at baretalk@livemint.com.

To read V. Anantha Nageswaran’s previous columns, go to www.livemint.com/baretalk

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