Freedom of Trade, Business and Profession

Freedom of Trade, Business, and Profession, enshrined in Article 19(1)(g) of the Indian Constitution, is a fundamental right guaranteeing individuals the liberty to practice any trade, business, or profession of their choice. This freedom is essential for fostering economic growth, individual empowerment, and the realization of India’s socio-economic goals. However, it is subject to reasonable restrictions under Article 19(6).

Scope and Provisions

1. Right to Choose a Trade or Profession

   • Ensures individuals the liberty to engage in lawful professions, industries, or trades without undue interference.
   • Example: Starting a business, practicing law, or becoming an entrepreneur.

2. Right to Establish a Business

   • Encourages economic activity by permitting individuals and organizations to create and run businesses freely.
   • Example: Setting up manufacturing units, retail stores, or tech startups.

3. Right to Trade Freely Across the Country

   • Promotes economic integration by removing barriers to interstate commerce.
   • Example: Traders can sell goods in any part of India without additional taxes or restrictions.

Reasonable Restrictions (Article 19(6))

The freedom under Article 19(1)(g) is not absolute and may be restricted to protect public interest:

1. State Monopoly

   • The state can monopolize certain trades for public welfare.
   • Example: Government control over industries like railways or atomic energy.

2. Public Health and Morality

   • Activities harmful to public health, such as the sale of drugs or adulterated food, can be regulated or prohibited.
   • Example: Bans on the sale of tobacco products near schools.

3. Professional Qualifications

   • Certain professions may require qualifications to ensure competence and public safety.
   • Example: Licenses for doctors, engineers, or chartered accountants.

4. Reasonable Restrictions

   • The state may impose restrictions to prevent unfair trade practices or monopolies.
   • Example: Regulations to curb insider trading or anti-competitive behavior.

Judicial Interpretations

• Chintaman Rao v. State of Madhya Pradesh (1950)

The Supreme Court held that unreasonable restrictions violating Article 19(1)(g) are unconstitutional.

• Sodan Singh v. New Delhi Municipal Committee (1989)

The court upheld the right of street vendors to trade, subject to reasonable regulations ensuring public convenience.

• Mohd. Faruk v. State of Madhya Pradesh (1969)

The court ruled that restrictions on trade must be reasonable and non-discriminatory.

Significance of the Freedom:

1. Economic Growth
   • Encourages entrepreneurship, investment, and job creation, contributing to national development.
   • Example: Policies promoting startups and small businesses.
2. Social Empowerment
   • Provides individuals with the opportunity to improve their socio-economic status.
   • Example: Women entrepreneurs starting small-scale businesses in rural areas.
3. National Integration

Unrestricted trade across states fosters economic unity and interdependence.

Challenges to the Freedom:

1. Excessive Regulation

   • Over-regulation by authorities can stifle innovation and entrepreneurship.
   • Example: Lengthy processes for obtaining business licenses.

2. Informal Sector Issues

   • Lack of protection and recognition for small traders and informal workers.
   • Example: Street vendors facing eviction or harassment.

3. Global Competition

Small businesses may struggle to compete with large multinational corporations.