Budget
Online platforms and workers to benefit as Budget formalises gig economy
Summary
- Finance minister Nirmala Sitharaman's announcement that gig workers will receive health insurance under the government’s flagship scheme is expected to increase interest in gig work, industry insiders told Mint.
Online platforms such as Swiggy, Zomato, Amazon and Flipkart are likely to see increased interest for delivery-partner and warehouse-worker jobs as the Union Budget has proposed formalising the gig economy, industry executives told Mint.
Union finance minister Nirmala Sitharaman announced in her budget speech on Saturday that gig workers would be provided health insurance under the government’s flagship Ayushman Bharat Pradhan Mantri Jan Arogya Yojana (AB-PMJAY). Currently, the National Health Authority (NHA) implements the world’s largest health insurance scheme, which provides health cover of ₹5 lakh per family per year. Under the terms of AB-PMJAY, there is no waiting period and no restrictions on pre-existing health conditions.
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Gig workers will also be issued identity cards and be eligible to register on the e-Shram portal, the national database of unorganised workers under the labour ministry.
‘Step in the right direction’
Balasubramanian Anantha Narayanan, senior vice president at TeamLease Services Ltd, said, “Officially recognising and formalising the gig economy is a step in the right direction. Including gig workers in the organised ecosystem will help them get employment benefits, and encourage more people to take advantage of the growing opportunities."
“The issuance of identity cards will give gig work the status of actual jobs. So far, gig work has been seen as temporary and mainly for side income. Food and grocery delivery platforms, e-commerce companies, and logistics firms will see massive benefits as formalisation kicks in," said Madhav Krishna, founder and chief executive of Vahan.ai, a blue-collar recruitment platform in Bengaluru.
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More than 85% of India's workforce is informal and a majority of it comprises gig workers, according to Teamlease’s Narayanan. Online commerce and logistics platforms are among the biggest employers of gig workers in the form of delivery agents and dark-store workers. These workers have become pivotal to the operations of the platforms as speedy and efficiency deliveries boost brand loyalty and customer satisfaction. The number of gig workers in India is expected to increase from 7.7 million in 2024 to 23.5 million by 2029-30, Niti Aayog estimates.
The growing digital economy has created more employment opportunities, especially for the freelancing workforce. As a result, the gig economy is also set to grow to 235 million workers by FY30, when it will comprise 4.1% of the total workforce.
"The digital economy has significantly broadened job opportunities, encompassing roles from delivery personnel, cab drivers, and beauty professionals to software engineers and data analysts," according to the Economic Survey 2024-25.
Moreover, hyperlocal service platforms have revolutionised the job landscape in the transportation, food delivery, and home services industries by creating flexible employment options by leveraging technology while transforming traditional service sectors into digitally driven ecosystems, the survey added.
Some already receive such benefits
To be sure, many platforms have already extended benefits such as health insurance to gig workers. A Zomato spokesperson told Mint the number of claims processed in favour of its delivery partners has more than doubled over the past four years to ₹53 crore a year, and that 55% of the claims in 2024 were paid to cover medical expenses unrelated to accidents.
Swiggy, too, has been offering health and other forms of insurance to its delivery partners at terms considered to be international best practices, said Dinker Vashisht, vice-president for corporate affairs at the company.
“The government's decision to cover gig workers under its flagship health insurance scheme is a worthy one. We will await more details to see how insurance can continue to be best provided, and how the interests of our delivery partners are best served," Vashisht added.
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Krishna of Vahan.ai added that digital platforms must work closely with the government to incorporate the changes. “No one party can take on the challenge alone. It's good that the government is putting some skin in the game because if the platforms are expected to take on the entire burden, it will stunt their innovation and growth, which will be bad for our economy in general," he said, adding that details of the framework and budget allocation for the scheme are yet to be chalked out.
The growing digital economy has created more employment opportunities, especially for the freelancing workforce. As a result, the gig economy is also set to grow to 235 million workers by FY30, when it will comprise 4.1% of the total workforce.
"The digital economy has significantly broadened job opportunities, encompassing roles from delivery personnel, cab drivers, and beauty professionals to software engineers and data analysts," according to the Economic Survey 2024-25.
Moreover, hyperlocal service platforms have revolutionised the job landscape in the transportation, food delivery, and home services industries by creating flexible employment options by leveraging technology while transforming traditional service sectors into digitally driven ecosystems, the survey added.
