The trade union movement emerged in India, basically as a reaction to the state interventionist or state pluralism model.

The economic reforms package (emphasis on privatization, liberalization and austerity measures) introduced in India in mid-1991 can be viewed as providing some kind of conducive environment for the trade unions in the public sector to engage in greater industrial disputes but what is being observed is that there is increasing dissension or fragmentation within the trade union movement itself. There has also been a decline in trade union activity over the years. Global economic trends have put tremendous pressure on the working class. Global institutions governed by Capital, like WB-IMF-WTO, are putting tremendous pressure on Nation sates to rationalize labour laws and undermine trade union rights. This emerging global economic environment is very conducive to the growth of Multi National Companies. It is fast turning National economies into a production chain with progressive low wages. In the process, the MNC's regain their dictatorship over global commodities, for consumption in developed economics. Companies are increasingly adopting methods to lower wages and social security costs by adopting measures like privatisation, closures, lay-off, retrenchment, Voluntary Retirement Scheme and subcontracting.

They have adopted labour intensifying incentive schemes, performance linked wage systems and compulsory overtime. In all these management strategies the key element is the flexibility in labour relationship.

The trade union movement in India goes back to the year 1875 under the leadership of Sorabji Shaparji who started the agitation to draw the attention of the government to the deplorable condition of women and child labour in Indian industries.

This followed by the establishment of the Bombay Mill-hands Association in 1890 by Mr. N.M. Lohande, a workman who organised a meeting of 10,000 workers as a result of which several demands were accepted by the mill owners, in Bombay Textile Mills. He started a paper known as Dinabandhu to educate the workmen. In 1987, the Amalgamated Society of Railway Servants of India was established and registered under the Companies Act followed by the Printer's Union, Calcutta, (1907), postal Union (1907), Kamgar Hitwardhak Sabha (1909) and the Social Service League (1910). However, these were sporadic organizations and could not make the real start in the Labour Movement till first World War.

The trade unionism in India developed quite slowly as compared to the western nations. Indian trade union movement can be divided into three phases. The first phase (1850 to1900) During this phase the inception of trade unions took place. During this period, the working and living conditions of the labor were poor and their working hours were long. Capitalists were only interested in their productivity and profitability. In addition, the wages were also low and general economic conditions were poor in industries. In order to regulate the working hours and other service conditions

of the Indian textile laborers, the Indian Factories Act was enacted in 1881. As a result, employment of child labor was prohibited. The growth of trade union movement was slow in this phase and later on the Indian Factory Act of 1881 was amended in 1891. Many strikes took place in the two decades following 1880 in all industrial cities. These strikes taught workers to understand the power of united action even though there was no union in real terms. Small associations like Bombay Mill-Hands Association came up by this time. The second phase (1900 to 1946) This phase was characterized by the development of organized trade unions and political movements of the working class. Between 1918 and 1923, many unions came into existence in the country. At Ahmedabad, under the guidance of Mahatma Gandhi, occupational unions like spinners unions and weavers unions were formed. A strike was launched by these unions under the leadership of Mahatma Gandhi who turned it into a satyagrah. These unions federated into industrial union known as Textile Labor Association in 1920.In 1920, the First National Trade union organization (The All India Trade Union Congress (AITUC)) was established. Many of the leaders of this organization were leaders of the national Movement. In 1926, Trade union law came up with the efforts of Mr. N N Joshi that became operative from 1927. During 1928, All India Trade Union Federation (AITUF) was formed. The third phase began with the emergence of independent India (in 1947). The partition of country affected the trade union movement particularly Bengal and Punjab. By 1949, four central trade union organizations were functioning in the country: 1. 2. 3. 4. The All India Trade Union Congress, The Indian National Trade Union Congress, The Hindu Mazdoor Sangh, and The United Trade Union Congress

The working class movement was also politicized along the lines of political parties. For instance Indian national trade Union Congress (INTUC) is the trade union arm of the Congress Party. The AITUC is the trade union arm of the Communist Party of India. Besides workers, white-collar employees, supervisors and managers are also organized by the trade unions, as for example in the Banking, Insurance and Petroleum industries. Trade unions in India The Indian workforce consists of 430 million workers, growing 2% annually. The Indian labor markets consist of three sectors: 1. 2. 3. The rural workers, who constitute about 60 per cent of the workforce. Organized sector, which employs 8 per cent of workforce, and The urban informal sector (which includes the growing software industry and other services, not included in the formal sector) which constitutes the rest 32 per cent of the workforce.