How Will CAA Impact Unemployment in India

If you didn’t spend the last week under a rock, you might have heard of a little disruption called the CAB, now CAA or the Citizenship Amendment bill which evolved into an act on December 9, 2019. The Bill became a law that gave way to give citizenship to migrants who are “religious minorities (Hindus, Christians, Sikhs, Parsis, Bhudhists and Jews) if their origin countries are Pakistan, Bangladesh, or Afghanistan.”

The political and social aftermath is rather complex to understand fully and put across; that’s why we try to understand the economic effects of the Act. Specifically, we look at the impact the decision will have on the job market.

The Citizenship (Amendment) Bill, 2016, was first introduced in the Lok Sabha on July 19, 2016. The bill was passed by the upper house of the Parliament (Rajya Sabha) on December 9, 2019, and the Citizenship (Amendment) Act, 2019, came into being.

The beneficiaries should contain documents to prove they have entered India on or before December 31, 2014. They should have faced “religious persecution or fear of religious persecution” in their countries of origin. Before the CAA, the citizenship to foreigners in Assam was given under the Assam Accord of 1985. Under that, religious persecution was no consideration.

How The Act Became an Issue

Northeast India is home to roughly 238 indigenous tribes that constitute 26% of the region’s population. The central issue of the debate of immigrants coming to the northeastern states is the right granted to work and vote under the new Act. The amendment allows immigrants to gain citizenship and apply for jobs and own property in the seven northeastern states.

The workforce of the region is dependent largely on the informal sector and the agrarian industry. The NRC in Assam left out 1.9 million residents, and with most of the migrants coming with little or no skills, the pressure on the informal sector is expected to rise.

As of now, there is a lack of clarity whether the immigrants will reside in these states after getting citizenship or will they be relocated to other regions of the country.

The Strained Industries

As of 2009-10, around 436.98 million workers (nearly 94%) were employed in the informal sector of the economy, whereas only 28.29 million workers (6%) were engaged in the formal sector of the economy. Manipur, Arunachal Pradesh, and Assam account for the top 3 states with the population living below the poverty lines with 36.9%, 34.7%, and 32%, respectively, living in BPL conditions.

89.77% of the total workforce was engaged in the informal sector of Assam in 2009-10 while only 10.23% were engaged in the formal sector.

The industries that dominate, in order of their market share, are:

  • Agro-based Industries
  • Tea
  • Crude oil and natural gas
  • Petrochemicals
  • IT/ITeS
  • Forest and mineral-based industries
  • Engineering industry
  • Chemicals
  • Handicrafts and textile
  • Tourism and hospitality industries
  • Horticulture


The exact effect of the decision will be observed when it becomes the law of the land and citizenship statuses are granted. According to the Intelligence Bureau, over 30,000 migrants have availed of these facilities and are now expected to be the immediate beneficiaries of the amended Citizenship Act.

The technical fields will take time to be filled and provide employment opportunities to migrants. The immediate pressure would be on settled agricultural activities, which is already overstaffed with the immigrants who have already entered the region.