Economic Survey 2025 Reignites Work-Hours Debate With Call For Flexibility

The Economic Survey 2024-25, presented in Parliament by Finance Minister Nirmala Sitharaman and prepared under Chief Economic Advisor V Anantha Nageswaran, has added a new perspective to the ongoing debate over longer working hours in India, reported The Economic Times.

The discussion gained momentum after Infosys co-founder Narayana Murthy suggested a 70-hour workweek for Indian professionals, sparking widespread debate among corporate leaders.

While Murthy later clarified that long working hours should be a personal choice, the Economic Survey now challenges strict work-hour regulations, arguing that they hinder economic growth and reduce workers' earning potential.

Citing Section 51 of the Factories Act (1948), which limits working hours to 48 per week, the Survey highlights how Indian labour laws prevent manufacturers from responding to demand surges.

In contrast, many other countries allow work-hour caps to be averaged over weeks or months, helping manufacturers stay globally competitive.

The International Labour Organisation (ILO) also recommends this flexibility, which enables companies to scale up production without excessive cost burdens.

The Survey argues that India's rigid work-hour policies increase costs, delay production, and weaken India's position in global markets. It suggests that allowing greater flexibility in work-hour regulations could improve time-to-market efficiency and boost the growth of businesses and employment.

The report also examines the unintended consequences of strict work-hour limits on workers' financial wellbeing.

While regulations are designed to prevent overwork, they often restrict earning potential due to conflicting legal provisions.

For example, under Section 56 of the Factories Act, workers can work up to 63 hours in a six-day week, but only 48 hours are considered regular, while the remaining 12 hours fall under overtime. However, Section 65 limits overtime to only 75 hours per quarter, significantly reducing potential earnings.

Recognising this issue, seven states—Maharashtra, Haryana, Himachal Pradesh, Odisha, Punjab, Karnataka, and Uttar Pradesh—have increased the overtime ceiling to 144 hours per quarter under the new Labour Laws.

The Survey calls this a step in the right direction, arguing that labour reforms should balance worker rights with economic growth, allowing firms to expand while ensuring workers have the option to earn more through increased working hours.

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