Policy Update
Viksha Adhinarayanam
Background
According to the Bonded Labour System (Abolition) Act, 1976, the official and legal definition of the bonded labour system refers to a form of forced, or partly forced, labour in which a debtor or their family agrees to work for a creditor. This condition arises in three ways: first, through debt, loans, or financial advances; second, through customary or social obligations; and third, through inheritance or birth into a specific caste or community, which leads to forced labour. Therefore, Bonded labour has long been recognized as one of the gravest violations of human rights in India.
Despite the legal abolition of the practice through the Bonded Labour System (Abolition) Act, 1976, yet even today it continues to persist across multiple sectors such as brick kilns, agriculture, domestic work, and construction that reflects a deep structural inequalities, entrenched poverty, and weak enforcement of labour laws. By workers often getting trapped in exploitative debt cycles, where advances taken from employers bind them to years of forced labour under degrading conditions. Importantly, Article 23 of the Indian Constitution explicitly prohibits both trafficking and forced labour, reinforcing the constitutional guarantee of freedom from exploitation. Alongside the 1976 Act, other relevant laws such as the Child Labour (Prohibition and Regulation) Act, 1986, and provisions under the Indian Penal Code provide a broader legal framework against bonded labour.
Therefore, In response to this continuing challenge, the Government of India launched the Central Sector Scheme for Rehabilitation of Bonded Labourers (2016). The scheme was designed to provide financial assistance, rehabilitation, and reintegration support to rescued workers. It promised immediate relief, vocational training, and linkages with welfare schemes to ensure sustainable livelihoods. In 2021, revised guidelines expanded the coverage with increased compensation amounts, and emphasized district‑level vigilance committees for monitoring. Furthermore, when we look at the beneficiaries it includes rescued bonded labourers, their families, and vulnerable groups such as women and children.
According to the reports from the National Human Rights Commission (NHRC) and independent studies, bonded labour still persists in today’s world due to poverty, lack of awareness, and weak institutional enforcement. Thus, the scheme is considered ambitious though it faces significant challenges in implementation.
Functioning
The scheme operates through district magistrates and vigilance committees, who are tasked with identifying bonded labourers, approving rehabilitation packages, and disbursing funds. According to the Revised Guidelines (2021), assistance ranges from ₹1–3 lakh depending on the severity of exploitation, with immediate cash relief and long‑term support through skill training and welfare linkages. The scheme also mandates coordination with other social protection programs such as housing, healthcare, and education.
However, the functioning of the scheme has been marred by several shortcomings. According to The Hindu (Delhi, 2025) the reports highlight delays in disbursement of funds, and leaving rescued labourers without immediate support. Where poor coordination between labour departments and district administrations has resulted in fragmented implementation. The beneficiaries often remain unaware of their entitlements, and weak monitoring mechanisms further undermine accountability. Whereas, the Oxford Human Rights Hub (2025) noted that vigilance committees are often inactive or lack adequate resources, reducing their effectiveness in identifying and supporting bonded labourers.
Lastly, the judicial interventions documented in Casemine judgments (2024–25) reveal the repeated failures in implementation, with courts directing authorities to ensure rehabilitation. Therefore, these rulings have underscored the gap between policy design and ground‑level execution.
Performance
When we look into the evaluation of the performance of the scheme in the last 2–3 years, it reveals mixed outcomes. On one hand, government claims in PIB press releases (2025) highlight the strengths of rehabilitation packages and integration with digital monitoring platforms. The Ministry of Labour has also emphasized the role of dashboards and MIS systems in tracking beneficiaries and disbursements. For example, official data shows that between 2023–2025, over 6,500 bonded labourers were rescued nationwide, with rehabilitation assistance sanctioned for approximately ₹120 crore, though only about 65% of funds were actually disbursed at the state level.
On the other hand, independent reports like The Hindu (Delhi, 2025) have mentioned that rescued labourers were left without sustained support, flagging failures in rehabilitation. The Jindal Global University Migrant Bonded Labour Report (2025) has also documented the exploitation of migrant bonded labourers in urban informal sectors, where rehabilitation measures were either absent or ineffective. Furthermore, NHRC hearings in Uttar Pradesh brick kilns (2025) revealed 216 cases of bonded labour violations, underscoring systemic gaps in enforcement.
Thus, the programme dashboards and ministry reports show allocations, but ground‑level disbursement remains inconsistent. Many states have failed to utilize funds effectively, and beneficiaries often face bureaucratic hurdles in accessing support. For instance, Tamil Nadu and Karnataka reported higher utilization rates (above 70%), while states like Uttar Pradesh and Bihar lagged significantly, with less than 40% of sanctioned funds reaching beneficiaries.
Impact
The impact of the scheme has been limited in delivering its desired results. While immediate relief has reached some beneficiaries, sustainable reintegration remains elusive. Debt cycles continue to bind workers, especially in Andhra Pradesh’s brick kilns, where The Hindu (2025) reported families burdened by debt bonded to a life of toil. Rehabilitation packages often fail to ensure long‑term livelihood security, leaving workers vulnerable to re‑bondage.
According to the British Safety Council (2025), bonded labour remains a “persistent problem in India,” undermining labour rights and social justice. Judicial rulings (Casemine, 2024–25) highlight repeated lapses in enforcement, reflecting weak institutional accountability. Thus, despite policy interventions, bonded labour persists due to deep structural issues that remain unaddressed.
Emerging Issues
Several issues have emerged from the analysis of the scheme’s implementation:
- Delayed Rehabilitation and Bureaucratic Inefficiency: Rehabilitation payments often arrive late, undermining the very purpose of immediate relief. Procedural hurdles at district and state levels weaken trust in the system and leave rescued workers vulnerable during the transition period.
- Weak Enforcement at the Local Level: Although legal provisions exist, enforcement remains inconsistent. District administrations frequently lack capacity or political will, resulting in poor monitoring and ineffective prosecution of bonded labour cases.
- Persistence of Debt Cycles: Even after rescue, many workers remain trapped in exploitative debt arrangements. This highlights the inadequacy of current rehabilitation packages, which fail to break the structural link between poverty, indebtedness, and bondage.
- Insufficient Skilling and Reintegration: Training programmes are either absent or poorly aligned with local labour market needs. Without meaningful skill, rescued workers risk falling back into informal or exploitative work, perpetuating vulnerability.
- Urban Migrant Vulnerability: Migrant bonded labourers in urban informal sectors remain largely invisible to policy frameworks. Their mobility and lack of documentation make them especially difficult to reach with rehabilitation and social protection measures.
- Digital Monitoring Gaps: Dashboards and MIS systems introduced for transparency often fail to capture ground realities. The reliance on digital reporting without independent verification reduces accountability and risks masking implementation failures.
Suggestions
To address these issues, there are few measures or suggestions mentioned as follow:
- Strengthen vigilance committees with independent monitoring and adequate resources.
- Ensure time‑bound disbursement of rehabilitation funds to rescued labourers.
- Expand vocational training tailored to local industry needs by ensuring sustainable livelihoods.
- Integrated rescued workers into mainstream welfare schemes such as housing, healthcare, and education.
- Enhance accountability through parliamentary reviews and CAG audits of rehabilitation programs.
- Build partnerships with civil society organizations to provide holistic support to rescued labourers.
Way Forward
More than legal prohibition, the abolition of bonded labour demands robust rehabilitation, livelihood security, and systemic monitoring. Where the macro round‑up suggests that rehabilitation must be linked with digital dashboards for transparency and accountability. On the other hand, the Vocational training and skilling programs must be expanded to prevent relapse into bondage. Furthermore, urban labour governance must be strengthened to address the vulnerabilities of migrant workers, those who fall outside the purview of rural‑focused schemes.
The partnerships with civil society and local governments play a crucial role in ensuring effective reintegration. Thus, the awareness campaigns must be intensified to inform workers of their rights and entitlements. Where the judicial oversight and parliamentary scrutiny can further strengthen accountability.
Therefore, the Abolition of Bonded labour and its system is seen as central to India’s vision of inclusive growth and social justice. By bridging the gap between legal guarantees and lived realities is essential for meaningful change.
References
- Press Information Bureau. (2025). Press Release. Government of India. https://www.pib.gov.in/PressReleasePage.aspx?PRID=2149348®=48&lang=2
- Ministry of Labour & Employment. (2025). Bonded Labour Report. DigiFootprint. https://master-labour.digifootprint.gov.in/static/uploads/2025/06/41b7bebf501983358b1c4867dff8082a.pdf
- Government of Tamil Nadu. (2021). Central Sector Scheme for Rehabilitation of Bonded Labourers – Revised Guidelines. https://tndistricts.nic.in/bonded-labour-abolition/related_government_orders/Central-Sector-Scheme-Revised-2021.pdf
- Jindal Global University. (2025). Migrant Bonded Labour Report. https://jgu.s3.ap-south-1.amazonaws.com/ideas/Migrant-Bonded-Labour-Report-2025_compressed.pdf
- Oxford Human Rights Hub. (2025). Bonded Labour in India: Challenges of Rehabilitation. https://ohrh.law.ox.ac.uk/59685/
- The Hindu. (2025, March). Report on rescued bonded labourers flags rehabilitation failures. https://www.thehindu.com/news/cities/Delhi/report-on-rescued-bonded-labourers-flags-rehabilitation-failures/article70336383.ece
- The Hindu. (2025, April). Burdened by debt, bonded to life of toil. https://www.thehindu.com/news/national/andhra-pradesh/burdened-by-debt-bonded-to-life-of-toil/article71259453.ece/amp/?utm
- National Human Rights Commission. (2025). Press Release: NHRC hears online 216 cases of alleged bonded labour in Uttar Pradesh brick kilns. https://nhrc.nic.in/media/press-release/nhrc,-india-hears-online-216-cases-of-alleged-bonded-labour-cases-in-uttar-pradesh-brick-kilns
- British Safety Council. (2025). Bonded Labour: A Persistent Problem in India. https://www.britsafe.in/safety-management-news/2025/bonded-labour-a-persistent-problem-in-india
- Casemine. (2025). Judgment: Bonded Labour Cases. https://www.casemine.com/judgement/in/67f3cabfc03c2477e62053a3 https://www.casemine.com/judgement/in/65b13d37121ace78b84da19c https://www.casemine.com/judgement/in/6a129adee8decc4ea4383d33
Acknowledgement
The author extends sincere thanks to the IMPRI team for their guidance.
Disclaimer
All views expressed in the article belong solely to the author and not necessarily to the organization.
About the Author:
Viksha A is currently pursuing a Master’s in International Relations at Loyola College, Chennai, and serves as a Research & Editorial Intern at IMPRI. She is passionate about public policy research and writing, with interests in governance, social impact, and contributing to evidence-based policy discussions through research and informed analysis.
Name of the Reviewers:
Kavin and Anshu Kumari
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