India’s 2026 labour shift to hike supply chain costs via new social security and wage rules. National strike set for Feb.
India is set to fully operationalise four landmark labour codes in 2026, mandating a statutory minimum wage and universal social security. Union Minister Mansukh Mandaviya stated that 2025 served as a transformative period, with the codes officially commencing on 21 November 2025 to consolidate 29 legacy laws into a modern framework.
The transition is expected to reshape cost structures across the logistics, cargo, and supply chain industries:
- Financial implications: New wage definitions and mandatory social security for gig, contract, and platform workers will likely increase payroll expenses for warehousing and last-mile delivery firms.
- EPFO 3.0: A digital upgrade in 2026 aims to accelerate provident fund withdrawals and pension settlements, enhancing formalisation for the transport workforce.
- Operational flexibility: Firms with up to 300 workers can now manage retrenchments without prior government approval, offering greater agility for fluctuating cargo demands.
The reforms face significant resistance from central trade unions, who have labelled the codes anti-worker. A national general strike is scheduled for 12 February 2026, following a formal ratification convention in New Delhi on 09 January 2026. This poses a direct risk of disruption to port operations, rail freight, and EXIM trade flows.
Arvind Goel, Co-Chair of the CII National Committee on Industrial Relations and Labour, described the move as a watershed moment. He noted that while compliance burdens are reduced through unified licensing, the focus remains on balancing business ease with enhanced worker protection.
SOURCE – BUSINESS STANDARD
