Flexible labour laws will help India's both organised and unorganised sectors and spur economic growth, World Bank chief economist Kaushik Basu has said.

Dr. Basu said that India's labour market is over-regulated and added that the strict labour laws were hurting the country's economic growth.

At an event to release a report titled `World Development Report 2013: Jobs,' Dr. Basu said, "India's labour market is over-regulated. India's rigid labour laws are hurting India's growth ... Flexible labour laws will help organised and unorganised sectors."

Speaking on the topic, he added that a greater flexibility in the labour market would create more demand for workers.

Earlier, the Word Development Report also noted that boosting urban development and hiking labour flexibility would be crucial to create jobs in more productive activities, sustaining growth and slashing poverty in India.

According to the new report, India is witnessing an increase in part-time work. The number of temporary workers in India jumped more than 10 per cent and 18 per cent in 2009 and 2010 respectively. More atypical is the rise in the number of informal workers in the country's organised sector.

Martin Rama, director of WDR, said that with rapid urbanisation, more than 50 per cent of the population in developing countries would be living in cities and towns before the year of 2020.