Banks, government offices and factories are shut, while public transport is also disrupted in parts of the country.
The government says the reforms are needed to bolster the economy.
But trade unions say the government has not addressed the demands of the workers in banking, telecommunication and manufacturing industries.
They also oppose a government directive to state-run pension funds to put more money into stock markets.
Tapan Sen, general secretary of the Centre of Indian Trade Unions, told the BBC that more than 150 million workers in different industries were on strike.
But there has been no independent corroboration of the numbers given by the unions.
Mr Sen's union has accused the government of a "vile conspiracy... to privatise the public sector and invite foreign capital in some parts of industry".
Banks, shops and schools shut down in parts of the country, including in the southern Karnataka and Kerala states, where public transport was also disrupted, according to reports.
News channels showed flag-waving protesters squatting on railway tracks in the states of Orissa and West Bengal.
More than 20 protesters were arrested after they damaged two government buses in West Bengal, senior police official Anuj Sharma told AFP.
Ten major unions called the strike after talks with Finance Minister Arun Jaitley broke down, with leaders rejecting his offer to raise the minimum wage for unskilled workers, reports said.
"This strike is against the central government, this strike is for the cause of the working people," Ramen Pandey of the Indian National Trade Union Congress told the AFP news agency.
"Our strike will be 100% successful... we will prove that this strike is the world's largest ever."
Since taking charge in May 2014, PM Narendra Modi's BJP government has initiated economic reforms and is trying to ease labour laws to attract foreign investment and make it easier to do business in the country.
The government also plans to sell its stake in state-owned companies, which are incurring heavy loses.
The country that boasts of Asia's largest rail network and possibly the world's highest passenger traffic, will soon roll out a premier train service between Mumbai and Goa — popular destinations on the west coast.
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