GurgaonWorkersNews – Newsletter 26 (May 2010)
Gurgaon in Haryana is presented as the shining India, a symbol of capitalist success promising a better life for everyone behind the gateway of development. At a first glance the office towers and shopping malls reflect this chimera and even the facades of the garment factories look like three star hotels. Behind the facade, behind the factory walls and in the side streets of the industrial areas thousands of workers keep the rat-race going, producing cars and scooters for the middle-classes which end up in the traffic jam on the new highway between Delhi and Gurgaon. Thousands of young middle class people lose time, energy and academic aspirations on night-shifts in call centres, selling loan schemes to working-class people in the US or pre-paid electricity schemes to the poor in the UK. Next door, thousands of rural-migrant workers uprooted by the agrarian crisis stitch and sew for export, competing with their angry brothers and sisters in Bangladesh or Vietnam. And the rat-race will not stop; on the outskirts of Gurgaon, Asia’s biggest Special Economic Zone is in the making. The following newsletter documents some of the developments in and around this miserable boom region. If you want to know more about working and struggling in Gurgaon, if you want more info about or even contribute to this project, please do so via:
In the May 2010 issue you can find:
1) Proletarian Experiences -
Daily life stories and reports from a workers’ perspective
*** Three Communists in Gurgaon -
The industrial development and proletarian unrest in Gurgaon did not remain unnoticed. We talked to three communists who decided to focus their political activity on the vast landscape of working class formation. The comrades are part of the revolutionary Marxist-Leninist left, belonging to three different political organisations.
*** Service?! What the hell! / Reports from Service Proletarians, Street Labour Markets and Factory Workers in Gurgaon -
Some voices of security guards and drivers, metal and textile workers. Some voices from workers looking for a job at corner labour markets, harassed by the police and other thugs.
2) Collective Action -
Reports on proletarian struggles in the area
*** Inflationary Proletarian Struggles -
While opposition parties arrange token protests against the price hikes, workers on the ground battle for higher wages. In March 2010 Delhi government announced 33 per cent increase of minimum wages, but this hike hardly ever reaches shop-floor reality. In the aftermaths of the minimum wage increase we observe various spontaneous proletarian actions in Gurgaon and Okhla industrial areas. The combination of an interlinked (automobile) industry and organisational efforts like Faridabad Majdoor Talmel can become future lines of coordination and generalisation of the unrest.
*** Update on Struggles of Permanent Automobile Workers at Sanden Vikas and Exide -
The first-tier supplying industry of the automobile industry is heating up under the double pressure of increasing demand of the assembly plants on one side and the more confident claims of the workforce on the other. The recent struggles at Denso, Sanden Vikas and Exide express the difficult position of a young permanent work-force: they appeal to the classical union form of struggle hoping to secure an increasingly precarious position. These classical forms detach them from the wider casual and temporary workforce and therefore from the true ‘material’ power-base.
*** Waterwars, Energy Crunch and Revolting Villages -
Groundwater levels in Gurgaon drop dramatically, gobbled up by industry and upper-middle class life-style. Water and energy flows are diverted away from workers’ and peasants’ spheres. We document some struggles of ‘villagers’ against the lack of resources and oil-pipe-line projects crossing their fields.
3) According to Plan -
General information on the development of the region or on certain company policies
*** The Social Tsunami Impact / Snap-Shots against Capital-Class-Crisis -
This is an attempt to introduce a regular update on general tendencies of crisis development in Indian – motivated by Greek shock-waves, naked shorts and potential spillovers. Apart from short glimpses on the macro-level of things we focus on general trends in agriculture and automobile sector: the current demise of the past and the toxicity of the future.
4) About the Project -
Updates on Gurgaon Workers News
*** Glossary -
Updated version of the Glossary: things that you always wanted to know, but could never be bothered to google. Now even in alphabetical order.
1) Proletarian Experiences -
Daily life stories and reports from a workers’ perspective
*** Three Communists in Gurgaon / Interviews for an Open Debate -
The industrial development and proletarian unrest in Gurgaon did not remain unnoticed. We talked to three communists who decided to focus their political activity on the vast landscape of working class formation. The comrades are part of the revolutionary Marxist-Leninist current left of the CPIs, belonging to three different political organisations. We decided to not mention the party names in the individual interviews, based on the experience that way too often the left focuses more on internal ideological quarrels than on the exchange and reflection of practical experience.
All three comrades visited the strike at Rico in autumn 2009 and wrote articles and pamphlets about the conflict. They see themselves outside and critical towards the established unions. We hope that the interviews about their impressions from Gurgaon can be a starting-point for an open debate about how to organise a ‘communist position’ within proletarian reality. There are many open questions which should be discussed ‘politically’ in future, we just mention some:
* How much importance do we attribute to analysis of social production process as a potential for generalisation of struggle (supply chains etc.)
* What kind of role can communist play in day-to-day reality and during specific struggles, such as at Rico?
* What are the potentials of factory groups or ‘hidden forms of day-to-day struggle’ and how can they coordinate with the wider working class area?
* Which roles do the established unions play and is there any use in registering ‘our own’ unions?
* Are there specific segments of workers or proletarian situations which bear specific potentials for proletarian movements to come?
* Where do our own resources come from, how do we organise our own reproduction in order to have time or in order to be rooted in the class terrain?
We want to refer to the practical proposal by comrades from Faridabad to open workers’ meeting places in Gurgaon, which we see as part of this debate: Faridabad Majdoor Talmel
We also want to refer to the importance of experiences of the past by quoting from a letter written after the death of Romano Alquati in April 2010. Alquati was part of Quaderni Rossi in the early 1960s, a group of dissident communists which tried to ‘co-analyse’ the conditions of a emerging new generation of industrial workers in Italy’s north:
“Alquati went to Torino not to cry over cardboard suitcases, but in search of an antagonistic power. The conflict in front of him was no longer between below and above, but between workers and capital. Power against power. To the scandal of the leftist intellectuals and party leaders, the mass worker did not sacrifice for universal justice, did not have conscience and ideals, but wanted more money and less work. The working class liberated itself only by extinguishing itself, refusing work and the identity of oppressed. For this reason it was an extraordinary cycle of struggles. Humanism died forever in the wildcats of Mirafiori and among the rivers of Porto Marghera.
There was no sociology of work – it did not even exist in Italy – studying the factory. In fact when Romano and the other young militants of the Quaderni Rossi (Red Notebooks) and then Classe Operaia (Working Class) began to do conricerca (co-research) they were contemptuously labelled anarcho-socialist, both by the Marxists who had no need of bourgeois science and by the academics who were the rentiers of bourgeois science. The co-researchers, instead, studied the global literature of the social sciences in order to understand and anticipate the struggles, for only from a partial viewpoint you can see the whole. And there they found the formation of class composition (On Fiat and Other Writings remains a fundamental text to comprehend it). More than that: they organized themselves within it. For conricerca has never been for Romano a “research from below”: either it was the organization of workers’ autonomy, or it did not exist. He had no populist ideal of horizontalism: the prefix “con” meant to question the borders between the production of knowledge and political subjectivity, science and conflict. It was not simply a matter of knowledge but the organization of a threat. Conricerca was working class science.
In fact Conricerca is above all a political methodology. Here the traditional categories of spontaneity and organization loose their consistency. “Spontaneity was organized.” But nothing was achieved once for all. The operaists had broken with the Marxist and Leninist tradition to reread Marx and Lenin within the new composition of living labor. And in this way they grasped the breach represented by the mass worker, which was also a clash within the class producing something that previously did not exist”.
Communists come from Some-where
P. is a student in his 20s, A. a party full-timer in his 30s and M. a welder in his early 40s.
In the mid-2000s I was studying at Delhi University and got in touch with a communist organisation. Inspired by a lecturer I started to work amongst cart-pusher on Chandni Chowk, we tried to establish a union there in 2006. This attempt failed mainly due to lack of financial resources. My family also depended on my income, my father has passed away, so I had to take a regular job. I started working in a retail shop, which was part of the Big Apple chain. I worked as a cashier in Delhi, our official working hours were from 2:30 pm till 11 pm, but actually we had to work till 4 am in the morning. The shop was 18 km from my home, so I spent a lot of time travelling, as well. There were about 40 people employed in the shop and at some point in January 2007 we decided to do something against the bad conditions. One day, before the counting of the cash money, we all stopped working at 11 pm and left the shop. The management reacted by ripping the work-force apart and sending people to work in various dispersed shops and branches of the chain. There were a lot of problems afterwards, so I needed a different job.
My father was in the CP, working in the mining industry. He wanted me to become a lawyer, but I saw how lawyers operated in the villages, when it came to land deals, and I thought it was a rather useless job. I finished my 10th class in 1984. I went to college afterwards, were I got in touch with a political party. I did not complete college, I went back and forth, then decided to do an ITI course as a welder. That was an individual, but a political choice, in order to work amongst workers. After the ITI course I thought of doing a BA, at that time I read a lot, but I left the BA and became a party full-timer instead. I lived in various cities and areas, travelled a lot, from Rourkela (steel industrial area) to Jamshedpur. I met workers, went to strikes, wrote pamphlets and articles for the newspaper, organised theory classes. In 1996 we had a party meeting in Nagpur were we decided to focus on building party units in factories. I worked in a garage for a short time, then at Nico, a company manufacturing molded engine parts for the car industry. Workers there found it strange that I refused overtime – after some arguments with the contractor I stopped working there after about three months. In 1997 I became member of the central committee of the party and worked full-time for the organisation again. I moved to Ilahabad for that. I wrote a proposal to the party, mainly saying that the party’s attempt to form factory units was unsuccessful and that more effort is needed to concentrate on the day-to-day problems of workers and to develop a communist position in that. Not as a trade union, but as a communist organisation explaining that the worker’s discontent is not individual, but that there are wider social reasons behind the problems. I thought that the party got involved in these efforts only half-heartedly. We were discussing theoretically, but answers can only be found in practical efforts.
My family supported the RSS, I come from a business household and I saw how the business got pauperised in the early 1980s. My generation had no prospect to take over the business, therefore ‘education’ became compulsory and obtained a new meaning: the new generation had to diversify. I first went to a government school, then to a public school. I wanted to become a burocrat, an IAS officer. I went to Stephen’s College at Delhi University, but I did not fit in. The other students had a generational tradition of elite education, I felt rather displaced. I started reading and I came across Marxist writing – there was not much political activity going on at the college. I tried to understand the social character of the individual situation I found myself in. I got in touch with a political organisation of the far left, but before joining I read party documents of various tendencies. I was looking for an organisation with a strategy based on the analysis of India as a capitalist society. I joined a smaller splinter group, became active at the campus. Finally I felt that the politics of the group was rather NGO-ised and the campus activities seemed limited. I joined the MA, but left it after one year. The decision to leave at that point was an expression of hatred against the system, not only against education system, also against the way the system plays out in family. I saw how two of my brothers, who lived in the same house but ran two different businesses got divided through the emerging differences in ‘economic success’, still living under one roof. For some reasons I rejoined and completed the MA, in four instead of two years. I joint the research department, but soon I left it. I left academia altogether and became a party full-timer. I continued some of my research on class and caste in 1920s – 1945 on an independent level.
Party full-timer means that ultimately the party decides where to send you. The party also takes care of your reproduction. I first was sent to three different working class localities in Delhi, our aim was to first build a youth organisation and then based on the support of the youth to build up trade union organisations. All three locations were close to industrial areas. We had some contacts in the area, we then started setting up a library, cultural activities, study circles, which were basically lectures. The youth helped us to distribute pamphlets in the area. The attempt to set up registered unions failed, the area was dominated by small scale industries. We managed to set up a struggle committee amongst construction workers. The construction site was close to the university. Our activists heard about non-payment of wages and started to discuss with building workers. We decided to strike, the strike was supported by students and teachers – during the strike we set up a public kitchen with help of the teachers. But construction workers are migrant workers, once they find an opportunity or the site is finished, they normally move on. Some phoned us after having left the site near the campus, but we had to tell them that they had to fight for themselves now. The committee was an attempt to hold people together, but it depends largely on activists’ input.
The party then sent me to Haryana, to the rural area. We wanted to form a youth organisation in the villages and similarly go from there to the organisation of agricultural labourers. One of the differences between village and town is that people seem to have more time in the village. The youth debated till 2 or 3 at night, we talked about all kind of things, problems of adolescence. The urban youth has the colleges for this kind of talks. The village youth did not want to work in the villages, to close to home, to close to everyone knowing who is who. It is also a question of honour. So the village youth migrated on a daily level to work on Haryana’s biggest rural market, where several thousand workers are employed, storing food, loading trucks. There we met youth from various surrounding villages. We set up a workers’ committee for these market workers, we raised issues, such as wage increases. In the end the CPI turned out to be more successful then we were, they had much better connections with the Labour Department in Chandigarh. The village youth does not want to work in the villages and those workers who do are usually from Bihar, they often feel to vulnerable to form an organisation.
I went back focussing the work on Delhi. We set up a front-organisation for workers – basically everyone can join it independently from other union membership. We encourage to form these groups in order to discuss and to have some space independently from the established unions. For example we went to Graziano, after the struggle, which culminated in the killing of a manager. The workers first had joined CITU, then AITUC, they finally approached HMS. The HMS main union guy is also a labour contractor. We can see that workers go to leaders, they expect them to use their links with the political class in the workers’ favour. If CITU cannot deliver this, workers approach different leaders, they calculate. Currently we can see a development which undermines this influence of ‘personal leaders’. The big companies focuses heavily on work discipline and rely less on local middleman. This also means that the union leaders are often by-passed. In the case of Grazianio various ML-organisations set up a Solidarity Network, but workers got closer to HMS after the company started accepting negotiations with HMS. We lost touch with the workers.
Arriving in Gurgaon
After I left the retail shop I attended a meeting of an organisation at Delhi University, an organisation which turned out to be a NGO, which I did not realise at that point. They were looking for full-timers to organise garment workers in Gurgaon. The organisation paid 4,000 Rs per month. I took the job and started to roam Gurgaon in June 2007, at that time I was completely on my own in this. I found it difficult to meet workers directly at the factory gate, so I mainly visited them back at their rooms. We talked about the main problems, such as non-payment of wages, no ESI, no PF – and what we could do about this. I found that the factory is only one area of conflict, many workers face harassment from locals and landlords. The workers said that according to their experience the unions in Gurgaon are not of much help, that they rip you off in the end. They also asked about my own motives and why they should believe me. I said that I am part of your social reality and that is why I want to engage in it. I did this kind of basic activities for about eight months. At one company I had a success: the company had not paid wages for six months, workers complained. I went to the Labour Officer and told him about the issue, asking him to send an inspector. The inspector confirmed the workers’ accusations and told the management to pay the outstanding wages within one week’s time. The management did pay. Through this success I established good relations with active workers in the company.
At that point the organisation decided to launch a convention, which was supposed the founding conference for building a union. The organisation set targets of how many workers should turn up. At that point I started to inquire more about the aims and financial resources of the organisation and basically found out that they were a NGO funded by NGOs in US-America. I got into arguments with the NGO hierarchy, I asked them what their aim was, whether it was just economical or was also aiming at general social change. They answered that they want to set up a union for economic gains. I nevertheless mobilised workers to come to the convention and about 600 to 700 turned up. A union was founded. For the union registration I went to Chandigarh several time. There the Assistant Labour Officer told be frankly that he will oppose the union registration because the NGO wants to target international clients like GAP etc., and that this would result in job losses. I told the NGO about this, but they said that this decision was not of my business, that I was not involved in the decision making. In January 2009 I left the NGO job. I debated with my comrades of the political organisation and we decided to continue the work in Gurgaon for political reasons. The political organisation would support me financially. Some of the active workers – who were ‘on my side’ after the success of getting the outstanding wages – were more or less bought of by the NGO, they were given jobs and financial incentives to stay with the NGO union.
We formed our own union, workers pay 10 Rs per month, which covers the main costs. There are about 200 to 250 members, but they come from different companies. In one single company there are about 60 members, but we kept silent about our efforts. We think that we would at least 50 per cent of the work-force on our side before we can come into the open and apply for union recognition. The danger is that after handing in official applications the Labour Department goes to the company with the membership-list in order to proof whether these workers are actually employed there. This would leave us vulnerable, therefore a certain strength is required. The NGO knew that we want to organise a union in this specific company, so they organised demonstrations in front of it and parallel assemblies – basically putting our comrades in the factory at risk, sabotaging our efforts.
We have a meeting place, but normally we meet in workers’ rooms. We don’t publicise the meeting place, only workers know about it. We have a core committee of 10 workers, they normally come to the weekly meeting and then coordinate with members in various factories. We have an internal newsletter. We think about publishing a newspaper, but we lack funds. We can take practical little steps, e.g. there was a problem in a company where workers of our group are employed. People there were forced to sign their resignation and then to re-join – in order to sabotage their seniority. We knew that we will not get any help from the Labour Department. First they asked workers to come individually to the office, workers managed to postpone this by saying that they will come the next day. The management got angry, we discussed in the meeting about this. The workers then said that they will sign once the management gives a reason in written for why they ask the workers for the signature. This went back and forth and finally the management sacked three workers. Workers told the management that they would have to push them out off the factory and that they would sit in front of the factory in protest against the dismissal. We also called the Labour Department, they told the management to take the workers back. The workers got their jobs back. This was a success.
We continued debates about how to set up factory units and decided to move to certain industrial centres. I decided to move to Gurgaon – I got aware of the situation there after the lathi-charge and repression against the Honda workers in 2005. Our main problem remains that we have little time for political activities, and that workers in general have little time. The second problem is that it is difficult to speak openly inside the factory. I arrived in Gurgaon in March 2009, I found a job within four days, as a welder in a machine manufacturing factory. There are not so many differences if you compare the proletarian situation in Ilahabad and the one in Gurgaon – it is a newer generation of workers. I don’t think that the migrant status of the workers makes much of a difference. I started to meet people, in order to form a group of workers. In my factory 300 workers are employed, one or two of them I meet on an irregular level after work. We have some kind of circle in the factory, but we are not in a position to raise demands or things alike.
Rico Strike Experience
I went to the Rico strike twice. At that time AITUC people hold speeches. Workers had lathis. Some people shouted: we will smash the factory, we will attack the Labour Commissioner. The AITUC people told workers to stay peaceful. The demonstration took place on the service line of the Highway, not the Highway itself. If you wanted to talk to workers, they told you to talk to the leaders. I wrote a leaflet about the strike, workers told me to show it to the leaders first. We distributed the leaflet in Udyog Vihar, about 1,000 leaflets. There people knew about Rico through the media, but they had no direct information. One worker said: see, what can we 200 people do, if even these 100,000 workers of the Rico dispute cannot do anything.
I went to the Rico dispute several times. When I was there no demonstration was going on. The management had some link with the panchayat, who asked the workers to remove the dharna, the protest in front of factory. The panchayat also told workers that they get the minimum wage and higher compensations for the family after the murder – the panchayat tried to mediate. At that point I saw no AITUC leaders. The workers just sat in front of the factory. Some said: the strike goes on for so long, it is 48 days now, what should we do?! I could give no proposal, the strike has already gone week after such long time, the unity failed. I would not have told them to block the highway, I would not have stopped them either.
We had some contacts to garment workers in Gurgaon, but our main activities happened during the Rico struggle. I have never seen a struggle like Rico before, it was a qualitatively different struggle – a transit moment. I saw a group of workers leading the work-force, but the rest of the workers were active themselves. The workers were getting trained through struggle. At the beginning they were sitting and gossiping, later on they started shouting whenever police turned up. Workers normally stop showing up once a strike carries on for long, but at Rico workers continued to come to the protest. AITUC was not used to this kind of long dispute, they normally organise one day strikes. These long disputes are a new trend. It is a new work-force, a young work-force in a new industry without established union structure. In this scenario you can see the failure of old unions. Amongst the young workers a group of workers become leaders. I could notice them as leaders, because all workers told us to talk to them. But the majority of workers think that they are leading the struggle. They said: if the union betrays, we will continue. In the strike local groups played a role, e.g. a bigger group of workers all came from a region in Uttranchal. The AITUC officials were not around 99 per cent of the time. Most of the non-permanent workers were present at the struggle, at least the casual workers. Most of the workers had ITI or diplomas, some MSC or BSC. People see that despite high level of formal education they are not been made permanent. Women played an important part, confronted police with lathis.
Workers were sitting in groups of six or seven and discussed. I listen to discussions about the ‘nature of the state’, the problems of the law. We asked questions: ‘if you focus on registration of unions, this does not mean that once your union is registered, the management will actually negotiate with you. You have to be organised and not solely rely on union leaders’. Workers asked: ‘how can all workers meet together and decide?’ We had some ideas: ‘a kind of referendum with proposals for the next steps of struggle that workers can kind of vote on’. We asked: ‘you formed a committee and got in touch with AITUC, but did you get in touch with other workers? You don’t even have a pamphlet to hand out’. People responded: ‘AITUC is coordinating that’. We then wrote a pamphlet and handed it out. It was the first pamphlet, only after that AITUC published their own pamphlet with the names of the leaders in big print. The workers relation-ship with the AITUC was arbitrary. People said: ‘The state is afraid of our struggle’. ‘They do not let Gurudas (CPI leader) come to meet us, because his words would be engraved in stone for us, they would have major importance’. On the other hand AITUC leaders had to say several times to workers during protests: ‘do what we say, otherwise you will not win’. This created some conflict with the local workers’ leaders. AITUC always asked workers to stay peaceful, while the local leaders had a more violent rhetoric. While AITUC was against hiding stones and lathis under the blankets, they did not oppose.
What has to be done?!
Currently there is only one person, every now and then there are two people of our organisation active in Gurgaon – so the debate with the political organisation is the main support.
One of the biggest problems in Gurgaon is that workers think that someone should come and help them. But we cannot talk openly, it is difficult to meet in parks. Often the locals against such meetings, they have an economic interest in migrant workers as tenants. We see the building of trade unions as one means, currently we focus on one company to register a union, but we have to be organised on the level of industrial area. Registering a union is a strategy, we see some advantages, such as the right to strike. But we look beyond the trade union boundary. We also don’t have the usual ‘leader-types’. When the issue about the sacking of the three workers came up, our members in this company thought about strike. We discussed it, but it was clear that if we are 40 organised workers amongst a work-force of 1,000 we are not in the position to strike. We would not have the strength to deal with the reaction of the management. On a daily level we have to raise consciousness. Use any possibility, whenever or wherever, to speak to workers. Talk about the importance of organisation. How can we be organised and what happens after being organised.
When the worker enters the factory, the struggle begins. The worker has a feeling of exploitation, but no language to express it. We have to explain, that it is not an individual problem, but a social one. We have to do that also through means of newspapers and leaflets. We have to link up with other workers. This has to be based on daily work and relation-ships, this does not happen spontaneously. We should not rely on the law, there is no need to register trade unions. Normally they become second class management. For the next year: I want to meet 10 – 20 other workers from various sectors and start debating how to overcome the current situation. I don’t see a specific segment of working class in Gurgaon which could play a special role in future movements. Normally workers in the basic industries, such as power plant workers, play a decisive role.
We suggest to form ‘organisations’ independently from the main unions. After the end of the Rico struggle the local leaders got more and more co-opted by AITUC. We had proposed to publish a newspaper together, about workers’ experiences and struggles around the world. But we lost touch with most of these workers. During a crisis mode a new consciousness emerges, but this consciousness has to be transformed in organisational forms. Organisation can not be enforced from the outside, but it does not emerge from inside alone. At this juncture in Gurgaon, we can spread ourselves horizontally, our organisation itself is not established in Gurgaon. We suggest to form workers’ committees. We are not in position to register unions and we don’t know whether it will be desirable in the future.
Some voices of security guards and drivers, call centre, metal and textile workers. Some voices from workers looking for a job at corner labour markets, harassed by the police and other thugs. The reports were collected and published by Faridabad Majdoor Samachar in February and March 2010.
We work near Shankar Chowk in Cyber City Phase 2 in building number 10. The security companies name is Globe Security Service. We work 12-hours shifts day and night. There is no weekly day off, there is no day off in general. For 30 days off 12-hours shifts we are paid 5,300 Rs. They cut money for ESI and PF from that wage, but we receive neither card nor fund form. About 250 Globe Security workers are employed at DLF Building Service (DLF is India’s main real estate developer). The wages are paid with delay.
The BK Security companies office is near Hanuman Mandir in Dundahera. We work on two 12-hours shifts. No days off. We are paid 4,500 Rs per month. The wages are paid in 500 Rs or 1,000 Rs instalments. If you ask for the outstanding wages management tells you that they will have you beaten up by the police. ESI and PF money is cut, but neither card nor fund number is given.
Swift Corporation Worker
(91 Udyog Vihar Phase 1)
About 100 workers are employed setting up fair stalls here and there. If no actual fair is going us drivers work from 9 am till 7 pm – if when are set up we work 24 hours on stretch. The wages are fixed at 5,500 Rs, overtime is not paid. The drivers are forced to drive fast, in result one driver had an accident in Jaipur on 24th of January 2008. He was badly injured and the company took him to Gurgaon to have treatment in an ESI hospital. He had to stay 11 month in bed and then needed crutches for another 7 months. When the accident happened the company made tons of promises. During the first months the company have 4,000 Rs per month for expenditures, after eight months they stooped paying. About 18 months after the accident the driver came back to the company, he had a certificate of a doctor saying that he was fit for work. The company refused to let him drive and made him stand at the company gate for the time of the 10-hours shift. The worker had difficulties standing upright for such a long time. The company did not allow him to use the drivers’ rest room. His wage was 4,9– Rs, then the company started to cut 500 Rs per month. The management said that this money is a pay-back of the money which the company had spent on his treatment after the accident. When the company started to cut 1,000 Rs in January 2010 the driver refused to take the wage – the company has not paid his full January wages till today, 27th of February 2010.
Call Centre Worker
We are 100 workers engaged with home-keeping in a nearby call centre, located atv Plot 265 in Udyog Vihar Phase 1. For working 9-hours shifts 30 days per month they pay us 3,640 Rs.
Labour Market Worker
The unofficial labour market is situated within the industrial area of Udyog Vihar Phase 1. Every day more than 500 workers gather on the street labour market. Sometimes you find work, sometimes you don’t. In order to force you to do very hard and heavy work sometimes thugs turn us and force you to come with them. They initially fix 200 Rs wage for the day, finally they pay 150 Rs. The police harasses us, tell us to move on and don’t ‘loiter’. But there is no other place to stand and wait. Where we stand we don’t have the possibility to get hold of drinking water.
(69 Udyog Vihar Phase 4)
We work everyday from 8:30 am till 9 pm. Sometimes they make us work till 3 am. We work 180 hours overtime per month, payment is at single rate. The wages of the helper in this boiler tank manufacturing factory is 3,500 Rs.
Premium Moulding Worker
(194 Udyog Vihar Phase 1)
Us 300 workers are working on two 12-hours shifts manufacturing steering-wheels for Maruti Suzuki, Mahindra, Hyundai, Tata and Ford. There are 50 casuals and 100 workers hired through contractors who run machines, but they are categorised as helpers and are given 3,000 to 3,500 Rs per month. We work 100 to 150 hours overtime per month, we get only 6 Rs per hour overtime payment.
Bhorji Supertech Worker
(272 Udyog Vihar Phase 2)
The factory manufactures coolers. The December wages have been paid to the permanent workers on 25th of January, to the workers hired through contractors on 28th and 30th of January. The 150 workers hired through contractors get 3,000 Rs, neither ESI nor PF .
Flow Link Worker
(141 Udyog Vihar Phase 1)
The workers manufacture chisels for the chemical industry. Out of 50 workers only 10 get ESI and PF. The helpers’ wages is 3,000 Rs.
EEL India Worker
(509 Udyog Vihar Phase 3)
The workers manufacture rotor packer for the cement industry. The helpers are employed as casual workers, they are told that they will be paid 3,914 Rs, which is the minimum wage. Actually they have to work on Sundays, as well, but are not paid for these days. The rest of the overtime is paid at single rate.
Eastern Medikit Worker
Wages in the factories in Udyog Vihar are paid with delay.
Royal Flex Worker
(256 Udyog Vihar Phase 1)
We print and manufacture posters, placards and signs and work from 8:30 am till 10:30 pm. We work Sundays, as well. The helpers are paid 2,400 Rs, Overtime is paid at single rate.
Bharat Export Worker
(376 Udyog Vihar Phase 2)
The helpers’ wage is 3,000 Rs and the tailors get 110 to 140 Rs for an 8-hours shift. We work from 9 am till 1 am on a daily level. They say we have to come on Sundays and work overtime. The drivers of the company also have long working-times: from 7 am till 10 or 11 pm. They pay single rate for overtime. The company runs two more factories: 493 Udyog Vihar Phase 3 and 316 Udyog Vihar Phase 4.
Kanchan International Worker
(872 Udyog Vihar Phase 5)
The January wages have not been paid by 27th of February 2010. The wages for September and October 2009 have not been paid fully, 500 to 1,000 Rs was given ‘for expenditures’.
(280 Udyog Vihar Phase 2)
Out of 400 workers 10 to 20 are old permanent workers. The casual workers work for the company since years, but every six months their company card is changed – so they don’t have to be made permanent and their PF money gets lost. The company shows Sundays as days off, but actually people work Sundays, as well. The workers manufacture garments for RD and Motherhood.
(152 Udyog Vihar Phase 1)
The people from the personnel department give all workers a hard time. On pay day they take 500 to 1,000 Rs from the newly hired helpers’ wages – they swear at you for any kind of reason.
(199 Udyog Vihar Phase 1)
January 2010 wages have not been paid yet, on 27th of February 2010.
2) Collective Action -
Reports on proletarian struggles in the area
*** Inflationary Proletarian Struggles -
While opposition parties arrange token protests against the price hikes, workers on the ground battle for higher wages. As of 1st of February 2010 Delhi government increased the minimum wage by about 33 per cent, industrial helpers are now entitled to 5,272 Rs. These are battles by a modern industrial work-force in an atmosphere of existential questions: On 6th of May 2010 an independent ‘research group’ published a report according to which Delhi has a malnutrition rate of 47 per cent among the urban poor and an overall rate of 35 per cent in the city, which is much worse than even Sub-Sahara at 33 per cent.
The textile companies – were labour costs are ranging at about 40 per cent of production costs – will have difficulties to ‘sustain themselves’ in the global rat-race of competition. A 30 per cent wage increase is indeed significant. For the time being (End of April 2010) the Haryana government did not announce similar wage hikes – merely an increase in Dearness Allowance, leading to monthly wage differences of 1,000 Rs between industrial areas of Delhi (Okhla) and Haryana (Faridabad, Gurgaon) – it is only a question of time before either management or workers’ pressure will lead to a re-levelling of regional wages.
On the day after announcement of the wage hike we distributed Faridabad Majdoor Samachar in the industrial area of Okhla, like every month. More workers asked for the paper, we distributed 400 issues more than usual. We were curious whether the official wage increase and the subsequent ‘non-payment’ of the new wage by company management will lead to similar unrests and wildcat strikes like in 2007 – for article click HERE. Indeed we heard a lot of workers complaining about ‘non-payment’ of the new wages, about skilled-workers being ‘re-scheduled’ to unskilled wages, about company bus-services being cancelled and so on. The days after pay day become tense – in March and April the ‘spontaneous’ struggle heated-up.
Viva Global Worker/Striker
On 8th of March 600 workers at Viva Global in Gurgaon started a wildcat strike demanding for the payment of the post-DA new minimum wage. On 9th of March the strike continued. Viva Global management called the police – but the police said that it was an issue between company and employees. Management made rather general promises, so far without result. Work continued on 10th of March. Viva Global is a main garment supplier for Marks and Spencers.
Dimple Export and Creations Ltd. Worker/Striker
(B-35 Okhla Phase 1)
The skilled workers are paid 150 to 170 Rs for an 8-hours shift. On 17th and 18th of March 2010 more than 300 skilled workers stopped working and demanded to be paid 248 Rs for an 8-hours shift. The contractor said that the male workers will be paid 220 Rs, the female workers 190 Rs and that from that money ESI and PF will be cut – but without proof in form of a pay-slip. The skilled workers refused the offer and after striking for two hours on 20th of March they decided to wait for the wage payment on 10th of April and that in the meantime they will not let anyone be sacked. After the strike the contractor started shouting a lot. The masters want their commissions and try to increase production at all costs. They won’t let you go to the toilet. From all the sitting the feet of the tailors start to swell up. Since the 25th of March the company let people go at 5:30pm – before that you either had to take a day off or stay till 9:30pm (if you had a headache they said: “Come on, take this medicine”.). The workers in the finishing department are in a difficult situation, they did not manage to lay down tools together – the thread cutting women workers get 100 Rs for an 8 hours shift.
Kiran Udyog Ltd. Worker/Striker
Kiran Udyog Ltd. manufactures metal parts for first-tier suppliers like Denso, Sona Koya and for the assembly plants of Honda HMSI and Maruti Suzuki. A share of production goes abroad, for example to Daimler Crysler or ZF Sachs in Germany or Regal Beloit in the US. Kiran runs six factories in Delhi area, out of which two are situated in Gurgaon. In Unit-3 (Delhi) about 300 workers are employed, more than half of them hired through contractors. In April 2010 their wages were 3,800 Rs, even after several years of employment. We met a small group of workers who told us that people start to take ‘collective days off’, demanding to be paid the new minimum wage.
While automobile manufacturers in Gurgaon vamp-up their production capacities – see report ‘The Social Tsunami Impact’ in this issue – workers rattle the supply chain. During March and April 2010 – as part of the Faridabad Majdoor Talmel – we met workers in Okhla, Faridabad, Gurgaon and Manesar who work for different employers. A casual worker Honda HMSI, a young permanent worker at Denso, the temp workers at Kiran Udyog, workers at Sanden Vikas. They are linked by productive cooperation on a daily level, bridging the 80 kilometres geographical distance and contractual differences between them. Reflecting on the struggles at Rico, Denso etc. we can find out about how to turn our (supply) chains into weapons of proletarian communication and combat.
Sanden Vikas Worker
(Plot 65, Sector 27a, Faridabad)
Inside the factory 65 permanent workers and 400 workers hired through three different contractors are employed. Apart from that there are 450 ‘staff’, the workers in the moulding department are nowadays also termed ‘staff’. It is permanent work, but workers hired through contractors who work since eight-ten years continuously in the plant are ‘temporary workers’. Their wages are low, they are forced to work Sundays. They work 150 to 225 hours overtime per month, 400 to 600 Rs are embezzled from their wages. The permanent workers were getting afraid about the security of their jobs, they became willing to ‘get organised’…(more in next newsletter).
Strike at Exide, Gurgaon-Bawal
According to the company web-site: “Exide Industries India is of the largest manufacturers of Lead Acid Storage Batteries in World. Almost 80 per cent of car manufactured in India are fitted with a battery manufactured by us.” Exide runs seven plants in India, one of them in Bawal, near Gurgaon, 3.5 lakh batteries per month are rolled out from this unit. The Bawal plant supplies Hero Honda, the globe’s largest motorcycle manufacturer. Hero Honda produces on an average about 15,000 units of bikes a day from its three facilities at Dharuhera, Gurgaon and Haridwar.
On 22nd of April 2010 the press published that, “Hero Honda has already loaded 5,000 bikes in which batteries are yet to be fitted Battery maker Exide has been facing labour trouble at the Bawal facility in Haryana since last month, curtailing its production by up to 75 per cent, a situation if continues could impact seriously auto manufacturers. When contacted Exide Industries director (automotive), Mr Pawan Kumar Kataky said the workers have been on a go-slow agitation since the end of March demanding higher wages and modification of the current three-year contract. Exide had negotiated a three-year wage agreement with its 150-odd workers in October 2009. However, in less than six months, a section of the workers wanted the agreement revised to secure higher wages. Senior Exide officials have already met Haryana chief minister Bhupinder Singh Hooda to break the stalemate.”.
As a side-note: Hero Honda has a second source of nuisance in form of a labour contractor who had been put out of the deal. On 2nd of May the press informed: “The court of Gurgaon Additional District and Sessions Judge YS Rathore has restrained Hero Honda Motors from dealing with the employees provided to it by Brain Logistics Pvt Ltd (which had been providing warehousing management service to Hero Honda) through any other contractor. The court passed the said orders after considering a petition filed by Brain Logistics yesterday. The petitioners maintained that they had been providing warehousing management service to Hero Honda Motors’ SPD plant in Gurgaon since October 2001, and had nearly 500 employees on their payroll. “However, in April, 2010, all employees provided by Brain Logistics to the said Hero Honda plant were usurped by the company management through a new purported contractor,” the petition asserted. “The sole purpose behind the move is to break the continuity of service and then absorb these trained workmen at a low cost,” it said, adding that the Hero Honda management was depriving these workers of their legal rights of seeking permanency in job and other perks “illegally and forcibly”.
JL Autoparts Worker
(14b, Industrial Area, Faridabad)
The helpers get 2,200-2,300 Rs. The machine operators who are employed by the company directly get 2,800 Rs, those from contractors get 3,000 Rs. The factory runs on two shifts, overtime is paid single rate, about 200 Rs are embezzled each month. Sometimes they make you stay longer after a 12-hours shift, but they will give you only 20 Rs for buying food. Only 20 to 25 workers of the total 500 have ESI or PF. The toilets are dirty.
Eco Auto Worker
(Plot 20, Sector 6, Faridabad)
After 50 permanent workers went on strike in May 2009, some of them were sacked in June 2009, the others in December. Now there are 75 casual workers and 75 workers hired through contractors who manufacture oil pumps for Hero Honda and carburators for Hero Honda, Yamaha, Enfield and Bajaj. Since August 2008 workers get holidays only at three festival / bank holidays, during the other festivals they have to work. They work two shifts, about 50 to 100 hours of overtime. The casuals and workers hired through contractor are not paid the statutory annual bonus. Since December 2009 the casual workers are not given any pay-slip anymore. They give you the money in an envelope – no explanation how much money for attendance, how much cut for PF, ESI.
*** Water Wars, Energy Crunch and Revolting Villages -
Gurgaon water-level drops, the industrial competition about who is able to drill deeper borewells is intensifying. Power-cuts are most unpleasant in areas were people depend on the borewells on a wider scale, e.g. for irrigation. Some news on the matter.
Suncity Township runs dry and blames construction workers
2nd of April 2010
Residents of Suncity Township – a middle-class gate community spread over 140 acres along Golf Course road – have been going without water for the last 10 days because the only source supplying water to the colony – a borewell – has gone completely dry. The society RWA has been using tankers to supply water to the families living here. ”The last 10 days have been hellish for about 5,000 people living in the township. First the borewell went dry a few weeks back, so we deepened drilling levels by about 10 feet. But that did not work for long and after a few days, the borewell went completely dry again leaving us with no water at all,” said Abhay Punia, president, Suncity RWA. ”During the last week we had to depend completely on the water bought in by the tankers which we then ferried to each house in buckets”. Residents said that to stop misuse of water, all construction activities in the township have been completely stopped. ”We have asked all labourers to leave the premises because they misuse water”.
Several protests against water shortage
3rd of May 2010
Irate residents held demonstrations at several places in the district today in protest against erratic water supply. Irked by persistent disruption in the drinking water supply due to non-functional boosters, residents of various affected wards in Bawal town blocked traffic on the Bawal-Pranpura road. Women broke empty pitchers there in protest against the alleged apathy of the Public Health authorities.
The blockade, which lasted about three hours, was lifted following the intervention of Tehsildar Jitender Kumar, who assured that the boosters would be repaired and water supply restored within 24 hours. Similarly, residents held a dharna at the waterworks at Mandhiya Khurd village, 20 km from Kosli, today against the supply of brackish water. They alleged that because of this their children were suffering from diarrhoea.
Power-Cuts Villagers block highway
6th of May 2010
Residents of three villages blocked the road for five hours in protest against the short supply of power in the villages. The blockade was lifted around noon after the officials of the district administration and the power department assured an action. The department agreed to supply at least six hours of power daily. Hundreds of residents hailing from Nagura, Dhankhari and Baghana villages assembled at the 32 kV substation at Nagura and demanded an explanation from the staff and the officials for the acute shortage of power supply.
7th of May 2010
In protest against the inadequate power supply, residents of Chhatar village today locked a 32 kV power substation. About 300 residents assembled at the power sub-station around noon. It is reported that the villagers virtually pulled out the staff on duty from the sub-station and locked up its main gate. After holding a meeting, they announced to lock up the power station which they said had become defunct following its inability to supply power for the past several days.
18th of May 2010
Residents of Gangholi village today locked up the gate of the power substation of the Uttar Haryana Bijli Vitran Nigam (UHBVN) to protest against the inflated bills and erratic power supply. People said while the total duration of supply in a day was not more than five hours, the department had been trying to overcharge them in an illegal manner.
Farmers oppose laying of pipeline
31st of March 2010
There was tension between farmers and officials near Ranauli Latifpur village in Dadri as farmers were trying to stall the laying of Indian Oil pipeline in the village. Villagers alleged that the police had been deployed in the area to quell their protests. Farmers are demanding land compensation on the pattern of Greater Noida area. The administration has announced compensation at the rate of Rs 640 per sq mt which farmers term as low. Farmers had called a panchayat at Shiv Mandir of the village, which unanimously decided to stop the work.
The condition of six farmers sitting on dharna in protest against low compensation, has deteriorated. The farmers are sitting on dharna under the aegis of Bhartiya Kisan Union since several days near Adda Gujarat village.
3) According to Plan -
General information on the development of the region or on certain company policies
*** The Social Tsunami Impact / Snap-Shots against Capital-Class-Crisis -
Following are rather random day-to-day shots in the general direction of a ‘bigger picture of global crisis in India’, motivated by Greek shock-waves, naked shorts and potential spill-overs. Apart from short glimpses on the macro-level of things we focus on general trends in agriculture and automobile sector: the current demise of the past and the toxicity of the future. Please add your pieces, throw your stones…
* State of Crisis and Fiscal Counter-Insurgency
Currently there are two major burning beds of crisis in India. The military counter-insurgency of the state against the armed rural uprising and the massive price inflation, particularly of proletarian goods, such as food and transport costs. If the first is an attempt to control the massive proletarianisation in the countryside, the latter is an outcome of the state’s ‘cheap-money-policy’ in order to keep urban-industrial India running through a global ocean of melt-down. The state tries to confine these two centres of crisis to their spacial and sectorial locations, the dividing walls are built out of state debts: the bail-outs of defaulting farmers, the massive grain procurement and rural employment schemes on one side; and the export incentives and low-interest credits for a deficit induced inflationary boom based on a labour-intensive low-wage regime on the other.
In order to keep rural and urban proletarians divided in their ‘separate crisis’ the state needs financial inputs.
“We had to inject Rs 80,000 crores as stimulus package to overcome the crisis, which helped arrest further deterioration of the Indian economy,” finance minister Mukherjee said in April 2010. He promises to bring the fiscal deficit down to 5.5 per cent from 6.7 per cent of the GDP, while announcing at the same time that plan expenditures of the Indian state for 2010 – 2011 budget will increase by 15 per cent. Fiscal deficit means that the state spends more than it earns; the difference is closed by borrowing causing future state debts. During 2009-10 the state’s borrowings already constituted around 40 per cent of the budgeted state expenditure. If state income (tax etc.) does not increase, the borrowing turns sour, it turns into debts. India’s public debt was at 78 per cent of GDP in 2008/09 (82 per cent in 2010). This is quite a lot, compared to other ‘emerging markets’ with an average debt of 45 per cent of GDP – public debts in riotous Greece are said to be around 125 per cent of GDP.
Where would the economical growth backing up the state expenditures come from?
The Finance Minister anticipates a GDP growth of 8.5 per cent against 7.5 cent in 2009-10. While 10 per cent manufacturing growth during the first half of 2010 seems to be ‘on track’, the wider indicators look less promising: Foreign Direct Investment inflows into India dipped 5.16 per cent to USD 25.89 billion in 2009-10. India’s exports declined 4.7 per cent to $176.5 billion in 2009-10. Export forms a fair chunk of the GDP (1988: 6 per cent / 2008: 22 per cent). Bilateral trade with China stood at 51.47 billion USD in 2008, but it declined to 43.3 billion USD in 2009. During 2008-09 the trade deficit was over 10 per cent of the GDP and the absolute value of the trade deficit was 63 per cent of the aggregate exports. A major part of the trade deficit was financed by software exports and remittances of Indians abroad – rather shaky and very US-dependent sources.
Sure, certain industries benefited from the induction of 80,000 crore RS, e.g. large scale construction, real estate, textile export and automobile industry, but the measure heated up the economy as a whole. During March – April 2010, after the inflation crossed the 10 per cent mark, the Reserve Bank of India (RBI) hiked interest rates by and cash reserve ratio. Having been forced to slow down the flow of cheap credit money through central banks, the state tries to raise ‘separate credit’ for itself out of the short-termed low-confidence blue: in may 2010 India’s financial markets saw the first issuance of ‘ultra short-term treasury bills’. RBI sold 35-day Cash Management Bills (CMB) to raise Rs 6,000 crore for the government. Previously, the lowest tenure Treasury Bills sold in the country had a tenure of 91-days. We don’t know how these bonds sold, in the end the state has to rely on more blunt measures of fund raising, such as the general fuel price increase in April 2010 – the state fixed petrol price is kind of a central tax in India. The last resort of the state is to go to the global pawn shop: while introducing the new budget plan for 2010 – 2011 the finance minister announced further ‘disinvestments’ (privatisations): “While talking about revenue mobilisation through disinvestment, Pranab Mukherjee said that they expect to generate Rs 40,000 crores in the coming year from disinvestment as against Rs 25,000 in 2009-10″.
* Agrarian Demise
Leaving the issue of military counter-insurgency aside, in April to May 2010 the state debate about how to tackle the rural crisis focused on two main issues: the state’s spending on food subsidies and the question of how to deal with indebted farmers.
The state acts as the main buyer of those agricultural produce which either enter proletarian consumption on a mass scale (wheat, rice, sugarcane) or which secure the livelihoods of middle market farmers (cotton). The state has to ‘guarantee’ prices on both sides – trying to prevent a mass decline of middle-scale farming and/or a further food price crisis for the proletarian households. This is a stumbling attempt to influence a fundamental social transformation on a price level.
The government’s annual spend on food subsidy has risen from 0.63 per cent of GDP in 2007-08 to 0.90 per cent in 2009-10 and is supposed to reach 1.1 per cent next year. Despite the government providing Rs 55,578 crore to finance purchase of food grains, in May 2010 the food ministry said that the sum is short of another Rs 26,979 crore. One way to lower the subsidy bill is to re-define poverty in a formal way. In May 2010 government officials announced to tighten the ‘Food Security For All’ program and exclude household ‘above poverty line’, which used to be entitled to subsidised food.
Re-defining poverty of the hungry and reclaiming debts from the walking dead: The total outstanding debt of farmers to banks in the country stood at 5,90,728 crore RS on 31st of March 2009 – this compares to the 80,000 crore RS ‘economic stimulus package’ and a total state budget of 11,08,749 crore RS! Despite ever-more-rapidly increasing suicide rates amongst farmers in the green-revolution areas the state announced a crackdown on loan defaulters on 15th of April 2010. The crackdown on farmers defaulting on agriculture development bank loans in the cotton belt in Punjab has begun with the first set of six farmers being arrested. The bank is witnessing a default of around 60 per cent in the cotton belt. The recovery rate among Punjab farmers was 90 per cent 10 years back. Successive failure of the cotton crop, use of loans for purposes other than agriculture and hope of further loan waivers has resulted in a steady increase of defaulters, who are up by around 40 per cent now. We have to see this ‘crackdown’ as a formal act, not as a viable option or systemic answer. The problem has turned from a question of credit defaults into default of a social mode of production. Rather than to crackdown and to precipitate the demise, the state in power has to bail out a large section of ‘defaulted farmers’, whose proletarianisation is politically much less affordable than paying their bill: “As per provisional figures, 4,21,278 farmers in Punjab and 8,85,102 in Haryana are estimated to have been benefited under the agricultural debt waiver and debt relief scheme, 2008,” the minister said.
* Automobile Future of Toxicity
If the peasants misery is the acute pain of the past, the automobile development is the crisis of an absent future, they are the push and pull of an over-stretched system. While it seems easy to understand the development of the car industry in the US, the tendencies within the automobile sector in India are less obvious. The Indian car industry followed the global slump from October 2008 to March 2009. Companies sacked temp workers and reduced capacities accordingly. The industry was then caught by the surprise of a ‘double incentive scheme’, one being the ‘scrappage schemes’ of the North which increased car exports from India, with higher growth rates than those of the ‘internal sales’; the second being the Indian state’s low-interest pampering of the upper-middle-class consumers, which managed to sustain demand. Most automobile manufacturers found their capacities and supply-chains over-stretched. By beginning of 2010 most manufacturers talked themselves into desperate positive thinking and announced major investments of existing and opening of new assembly plants – based on general figures which already suggest a general trend towards over-capacities (see below). We have an even more complex picture when it comes to ‘car parts manufacturing’: since 2008 the export of parts growth faster than the export of assembled cars, at the same time since 2009 we can see that the share of car part imports for local assembly – mainly from Thailand and South Korea – increases quicker than the general local parts manufacturing. This translates as follows: Assembly plants in India use more parts from abroad, while the part manufacturers in India send increasingly more parts abroad than to the local assembly plants. Since 2008 we can see an actual extension and re-linking of the supply-chain between North and South and within Asia. We can see a frantic search for solutions driven by Greek fears. Following some details, which concretise some of the assumptions above.
Last year, customers around the world bought 50.91 million cars, 2.4 per cent down from 2008′s 52.17 million. In contrast, the Indian market did well with 1.2 million cars sold in 2009, 12.5 per cent more than the 1.05 million they did in 2008. On the background of this ‘modest boom’ companies such as General Motors, Volkswagen, Mahindra and Mahindra (M&M) and Renault-Nissan, among others have announced that they are looking to set up new plants; other companies such as Maruti Suzuki, Hyundai and Bajaj Auto are planning expansion in their existing factories. Where should it all be parked? Even if we take a slightly higher sales number for the internal market of 1.5 million, the question remains how to run ten to fifteen assembly plants on a profitable capacity level, particularly when Maruti Suzuki alone has an annual production capacity of more than 1 million cars, while exporting only 140,000?
Similar numbers at Hyundai and Nissan. Hyundai is the largest exporter of passenger cars from India with around 68 per cent market share. “Last year, we exported slightly over 270,000 units, out of which around 50 per cent were shipped to EU countries. Demand was good last year, as it was spurred by the scrappage incentive which most of the governments in the EU countries had introduced” Hyundai General Manager said in May 2010. Nissan began test trials of exporting cars in April 2010. The first shipment was expected to reach Barcelona in 22 days. Nissan Motor India Managing Director said the company was “gearing up for exports to Europe from second half of 2010.” Nissan exports are expected to reach 1.10 lakh units in 2011.
India has two of the world’s 10 largest car factories: Maruti Suzuki India Ltd’s factory in Gurgaon, which is at No. 3, and Hyundai Motor India Ltd’s in Chennai at No. 7, an indication not so much of the country’s growing market for cars or its emergence as an export hub, but, according to bourgeois economists, to the more labour-intensive regime in assembly plants in India. Here things become confusing:
In contrast to the common sense that an automatised plant would have to churn out more goods in order to meet ‘economy of scale’, the ‘analysts’ claim that: “In India, scale can be hit at between 400,000 and 500,000 units,” said Vikas Sehgal, a partner at consulting firm Booz and Co. Managing these plants is very complex as they begin to resemble “mini cities”, he added. Sehgal estimates that in Europe and the US, car makers would have to roll out 250,000 cars a year to achieve economies of scale. Let’s leave aside the fact that apart from Suzuki and Hyundai factories most other assembly plants have a lower annual output than comparable European plants – mainly due to their stage of ‘production start’. The fact that the biggest assembly plant in India still runs on two shifts hints a more ‘labour-intensive’ character of car assembly in India. In the North assembly plants have to run on three shifts in order to ‘valorise’ the huge amount of machinery before its bell tolls.
Car Parts Re-Shuffle
Today, 95 per cent of the parts of small cars such as the Maruti 800 are made in India. This increase in ‘localisation’ was achieved by keeping up high import duties and other measures to encourage ‘local production’ and investment. These import duties on components have fallen from 60 per cent in the 1980s to 10 per cent today. As a consequence import of components has grown faster than domestic production since the 2005-06 fiscal, according to a study released recently by industry lobby group Federation of Indian Chambers of Commerce and Industry (Ficci).
In 2006-06 India imported components worth 2.77 billion USD, or 22 per cent of the size of the industry. In 2008-09, this grew to 6.12 billion USD, or 30.8 per cent of the industry size. The degree of ‘localisation’ seems to sink. “There are indications of that,” said Vishnu Mathur, executive director of industry lobby Auto Component Manufacturers Association of India. “A number of investments that could have come to India have gone to Thailand.” At the same time the export of car parts from India growth faster than the export of assembled cars.
Examples from Gurgaon: Maruti Suzuki, Hero Honda, Honda HMSI
Maruti Suzuki, produced 9,66,069 cars from January to December 2009, up 27 per cent from the year ago. In a statement, the company said, “In the October-December 2009 quarter, favourable conditions in the domestic market supported by the government’s stimulus package and ease of automobile finance helped achieve good sales.” The company exported 1.4 lakh units to other international markets and is expecting to maintain the same figure this year. During the quarter under review (Q3), Maruti’s domestic sales volume rose 37.8 per cent to 2.18-lakh units, whereas its exports climbed by more than 167 per cent to 39,116 units led by compact car A-Star. Maruti Suzuki India has earmarked an investment of close to Rs 6,000 crore over the next 24 months, capacity at the Manesar plant will be increased by another 2.5 lakh units by 2012. Maruti managing director said there were no plans begin a third shift; with the present arrangement it was possible to manufacture 1.2 million vehicles annually on an installed capacity of a million units. “The option of third shift exists but we are cautious because of issues of quality etc”. Rural sales doubled to account for 18 per cent of total car sales, whereas share of sales to government employees stood at 13 per cent.
The world’s largest two-wheeler maker Hero Honda announced in April 2010 that it will produce over 45 lakh units in 2009-10 from its three facilities in India and will decide on setting up a fourth manufacturing unit within the next six months. “Despite difficult conditions, we will surely produce 4.5 million units for 2009-10 against 3.7 million units of last fiscal… The market wants more,” Hero Honda Managing Director Pawan Munjal. Hero Honda is said to be looking for a suitable location in Gujarat or Himanchal Pradesh to set up a new manufacturing unit. Sources say that they are interested in setting their plant in Sanand region (Gujarat) where Tata has established their Tata Nano manufacturing unit.
Honda’s Indian motorcycle and scooter arm is to build a new motorcycle production plant to meet increasing demand for motorcycles in India. The new plant will complement Honda’s existing production plant in the Gurgaon District in Haryana, where production will be ramped up from 1.25m cycles per year to 1.55m by the end of this month (April 2010), with a further expansion to 1.6m cycles planned for next year. To build the second plant, Honda Motorcycle and Scooter India (HMSI) will acquire approximately 240,000sqm of land within the Tapukara Industrial Area in Rajasthan, which is 40km from the existing plant and around 90km from Delhi. HMSI’s sales have grown steadily with 2009 sales of approximately 1.09m units (up 11 per cent compared to 2008) achieving a record high for nine consecutive years.
4) About the Project -
Updates on Gurgaon Workers News
Updated version of the Glossary: things that you always wanted to know, but could never be bothered to google. Now even in alphabetical order.
Lakh (see Crore)
Wages and Prices
Workers hired through contractors
The All India Trade Union Congress (AITUC) is the oldest trade union federation in India and one of the five largest. It was founded in 1919 and until 1945, when unions became organised along party lines, it was the central trade union organisation in India. Since then it has been affiliated with the Communist Party of India.
Business Process Outsourcing: for example of call centre work, market research, sales.
Centre of Indian Trade Unions, a national central trade union federation in India. Politically attached to CPI(M), Communist Party of India (Marxist). Founded in 1970, membership of 2.8 million.
Workers hired by the company for a limited period of time.
Workers hired for a specific performance, paid for the performance.
1 Crore = 10,000,000
1 Lakh = 100,000
DA (Dearness Allowance):
An inflation compensation. Each three to six months the state government checks the general price development and accordingly pays an allowance on top of wages.
Deputy Commissioner, Head of the District Administration.
ESI (Employee’s State Insurance):
Introduced in 1948, meant to secure employee in case of illness, long-term sickness, industrial accidents and to provide medical facilities (ESI Hospitals) to insured people. Officially the law is applicable to factories employing 10 or more people. Employers have to contribute 4.75 percent of the wage paid to the worker, the employee 1.75 percent of their wage. Officially casual workers or workers hired through contractors who work in the factory (even if it is for construction, maintenance or cleaning work on the premises) are entitled to ESI, as well. Self-employment is often used to undermine ESI payment.
1 US-Dollar = 43 Rs (July 2008)
1 Euro = 68 Rs (July 2008)
Haryana State Industrial and Infrastructure Development Corporation
Industrial training, e.g. as electrician or mechanic. Two years of (technical school), one year of apprentice-ship in a company. During the two years at school the young workers receive no money, but they have to pay school fees. A lot of the bigger companies ask for ITI qualification.
Lay off in the Indian context means that workers have to mark attendance, but they actually do not work and receive only half of the wage.
Official minimum wage in Haryana in June 2007 is 3,510 Rs per month for an unskilled worker, based on an 8-hour day and 4 days off per month. But hardly any workers get this wage.
A locally elected village administrative body in charge of village-level issues.
PF (Employee’s Provident Fund):
Introduced in 1952, meant to provide a pension to workers. Officially applicable to all companies employing more than 20 people. Official retirement age is 58 years. Given that most of the casual workers belong to the regular workforce of a factory, they are entitled to the Provident Fund, as well. So are workers employed by contractors. If workers receive neither PF nor ESI they also do not show up in the official documents, meaning that officially they do not exist.
Officially the so called ‘governmental fair price shops’ are shops were ‘officially poor’ people can buy basic items (wheat, rice, kerosene etc.) for fixed and allegedly lower prices. In order to be able to buy in the shops you need a ration card. The ration card is also necessary as a proof of residency, but in order to obtain the ration card you have to proof your residency. Catch 22. Local politics use the ration depots and cards as a power tool that reaches far into the working class communities. Depot holders’ jobs are normally in the hands of local political leaders. In return they receive this privileged position, which often enable them to make money on the side.
Superintendent of Police, Head of the District Police.
In India staff includes managers, supervisors, security personnel and white-collar workers.
In general trainees work as normal production workers, they might have a six-month up to two-year contract. Depending on the company they are promised permanent employment after passing the trainee period. Their wages are often only slightly higher than those of workers hired through contractors.
VRS (Voluntary Retirement Scheme):
Often a rather involuntary scheme to get rid of permanent workers. Particularly the VRS at Maruti in Gurgaon made this clear, when 35 year olds were sent in early retirement.
Wages and Prices:
When we hear that a cleaner in a call centre in Gurgaon, an industrial worker in Faridabad or a rikshaw-driver in Delhi earns 2,000 Rs for a 70 hour week, which is about the average normal worker’s wage, we have to bear in mind that they often came from West Bengal, Bihar or other remote place in order to get this job. In order to put 2,000 Rs into a daily context here are some prices of goods and services – based on Summer 2006 prices:
- Monthly rent for a plastic-tarpaulin hut shared by two people in Gurgaon: 800 Rs
- Monthly rent for a small room in Gurgaon (without kitchen), toilet and bathroom shared by five families: 1,300 Rs
- Monthly rent for a small room in a new building in central Gurgaon, single toilet and bathroom: 4,500 Rs to 8,000 Rs
- Half a kilo red lentils on the local market: 25 Rs
- Kilo rice on local market: 14 Rs
- 1 Kilo Onions and 1 Kilo carrots on local market: 25 to 30 Rs
- McChicken: 40 Rs
- Bottle (0,7l) of beer at Haryana Wine and Beer shop: 50 to 70 Rs
- Cigarettes (10), cheapest local brand: 25 Rs
- Starbucks Coffee (Latte Medium) in Shopping Mall: 59 Rs
- Faulty shirt on Faridabad local market: 40 Rs
- Single gas cooker plus new 2 litre gas cylinder: 720 Rs
- Re-fill gas (2 litres – once every month and a half): 100Rs
- Second-hand bicycle: 600 to 1,000 Rs
- Two simple steel pots: 250 Rs
Transport and Communication:
- Bus ticket to nearest bigger bus stop in South Delhi: 14 Rs
- Daily Newspaper: 3 Rs
- One hour internet in a cafe: 20 Rs
- Cinema (new) ticket Saturday night: 160 Rs
- Single entry for swimming pool: 100 Rs
- One litre Diesel: 30 Rs
- Driving license in Haryana: 2,000 to 2,500 Rs
- Start package pre-paid mobile phone (without the phone) 300 Rs
- Phone call to other mobile phones: 1 Rs
- One month mobile phone flat rate: 1,500 Rs
- Minimum dowry poor workers have to pay for the marriage of their daughter: about 30,000 Rs (80,000 Rs more likely)
- Money given to poor labourers for their kidney: about 40,000 Rs
- Compaq Laptop: 50,000 Rs
- Flight Delhi to London: 28,000 Rs
- Cheapest Hero Honda motorbike (150 cc): around 40,000 Rs
- Ford Fiesta: 587,000 Rs
- Four hours on Gurgaon golf course: 800 Rs (info from golf course worker earning 2,400 Rs monthly)
- Two-Bedroom Apartment in Gurgaon: 10,000,000 to 50,000,000 Rs
Workers hired through contractors
Similar to temporary workers, meaning that they work (often for long periods) in one company but are officially employed by a contractor from whom they also receive their wages. Are supposed to be made permanent after 240 days of continuous employment in the company, according to the law. A lot of companies only have a licence for employing workers in auxiliary departments, such as canteen or cleaning. Companies usually find ways to get around these legal restrictions, e.g., workers services are terminated on the 239th day to avoid workers reaching eligibility criteria to become permanent. In many industries contract workers account for 60 to 80 per cent of the work force, their wage is 1/4 to 1/6 of the permanents’ wage.