New Horizons

New Horizons

 How can social and digital empowerment fuel positive growth for Dharavi's SMEs?

Rapid industrialization, rise in the digital economy, and the current COVID-19 crisis have enormously affected all livelihoods, particularly small-scale businesses and everyday commerce. These establishments have suffered to an extent of complete closure, resulting in a breakdown of the sector. Small scale businesses in Dharavi are the backbone of Mumbai’s marginalized workforce. From pottery to leather factories, these Micro, Small and Medium Enterprises (MSMEs) make a significant contribution to manufacturing output, creating employment for both skilled and unskilled workers and promoting inclusive growth. While employees in the ICT (Information and Communications) and Financial sectors were able to protect their jobs, the weaker sections of society suffered the brunt of the pandemic. Small scale businesses and their workers are the most vulnerable in times of crisis and require additional support to recover and survive. The rapidly changing nature of the crisis is outpacing socio-economic change, not allowing government assistance for recovery to trickle down to small-scale businesses. This blog is a reflection from a number of industry employer and worker interviews we conducted on their needs towards a faster and positive economic recovery.

It is already established that Dharavi is a strong economic engine that is decentralized, human scale, home-based, low-tech, and labor-intensive. It is an important asset that empowers the marginalized and vulnerable population of the country. People of all education and age levels move here to learn and develop their skills over time, and some even become entrepreneurs themselves.

The working class may not even require formal education, experience, or skills. Dharavi is a skill pool encouraging workers to learn and share their techniques with each other. Normally, a new worker is hired as a helper to an experienced worker that allows them to observe and learn the tasks at hand. Once their skills are advanced, their role and responsibilities also grow. In the garment industry, for example, business owners hire experienced workers but the artisan directly works with helpers teaching them skills.

“I am an artisan working in the garment industry. If I hire a new helper, I will be responsible for teaching him the new skills. The business owner only looks after the business.” - Mushahid, Artisan

Flow of responsibilities and skill sharing
Flow of responsibilities and skill sharing

Dharavi supports diverse forms of employment, from permanent workers who receive a monthly salary to daily wage workers who are flexible and are hired depending on labor requirements. This varies across industries and is also demand-based. In the pottery industry, for example, an average of 10-12 artisans work on a permanent basis but if there is a requirement for more labour, then daily wage workers with some experience of pottery production are hired. Daily wage workers often plug into different businesses and are in demand seasonally. 

Part-time women workers are also a big part of the economy, who engage in tiffin services, zari work, diya and jewellery making, and daily labor to support their families. They mainly engage in seasonal employment working from home and in a close network with one another. 

“It is a family business. My husband and kids help me whenever they are free. I take care of the detailed work and other family members assist me with packaging and delivery” - Sanjana, Home-based business owner/artisan  

While the current internet usage of business owners and workers is limited, many production designs, orders, and supply chain coordinations have transitioned online due to COVID-19. This has introduced small-scale business owners and workers to the potential of networking, collaborating, and working digitally to gain access to open markets and their resources. There is now a growing recognition that people and businesses can be empowered through a digital platform that is accessible and catered specifically to Dharavi’s needs. In an interview with Gulzar, a leather business owner said, “I currently use WhatsApp and Instagram for my business. Selling on Amazon is complicated and not many business owners from Dharavi can work with such a complex online platform. It would’ve been great if there was an easier way to sell products online and reach the global markets.”

In the face of a rapidly changing economy and growing digitalization, we believe that digital and social empowerment has the potential to advance economic recovery for the SME’s in Dharavi. 

Digital Empowerment: Can a hyperlocal digital solution empower small businesses and foster collaboration between businesses, consumers, and allied enterprises?

At a neighborhood scale, the digital platform will help in creating a network of local businesses and workers, providing opportunity updates and helping small business owners sell their products. It will act as a local marketplace, thereby strengthening local networks. At a city and national scale, it will provide equal opportunities and awareness about all government schemes and microcredit funding options, many of which are unknown to Dharavi businesses. Additionally, this platform will facilitate training and exchange of knowledge, supporting a shared economy. 

Social Empowerment : 

1. Enabling better public infrastructure and policies: 

a) With the Internet becoming essential for business, education, communication, and services, government policies should aim at providing cheaper and more public-owned digital domains. 

b) While most businesses are struggling to keep up with bills and payments, a subsidy for electricity and cable bills from the government can support faster recovery. 

c) The relaxation of GST tax and export-import duties can aid business owners in resuming their work by relinking supply chains and facilitating easy trade. 

d) The government should also come up with better schemes that provide quick economic support or loans at low-interest rates, rather than long-term schemes that fail to reach the MSMEs with immense potential. 

e) Current infrastructure policies must be rethought to enable incremental growth within the neighborhood. 

2. Setting up a minimum wage for daily and monthly salaried workers so that they gain stability and are not vulnerable during a crisis. During the COVID-19 crisis, many workers fled to their families in other cities and villages, and with the inability to work remotely, they were without income for months. Since these communities were the hardest hit, it is essential for the government to set a true wage to support workers and their families. Dharavi currently lacks labor unions and organizations to ensure social justice for the worker community. Local organizations with local community leaders can protect the welfare of workers, so they can live an equitable and dignified life.

3. Opportunities for constant learning and upskilling through a Universal Opportunity Account: Universal Opportunity Account is set up with a certain number of non-tradable credits that can be redeemed for starting a business or training online and offline in an open learning system. The working community can accumulate these credits through sharing of resources, supporting co-business owners, helping other businesses, and involving women in the supply chain with fair compensation. With the credits earned they can get time and money for scaling their business or skilling, upskilling and reskilling. In the face of a global crisis, jobs that help enhance a community or a country’s social and ecological capital could be rewarded through these Universal Opportunity Credits that could be added to their Universal Opportunities Account and used for enhancement of livelihoods. By creating income opportunities, providing skills training, and empowering people economically through financial inclusion, the Universal Opportunity Account will break down barriers and create the conditions for growth.


*Illustration by Aditya Warrier and Brendon D'Lima