8 | International Union Rights | 24/1 FOCUS | WORLD BANK AND IMF The World Bank, the Tata Conglomerate and Tea Workers in India In September 2016, the Compliance Advisor Ombudsman (CAO) for the World Bank's private investment arm, the International Finance Corporation (IFC), issued a striking report on the Bank's investment in Indian tea plantations partowned by the massive Tata conglomerate and employing more than 30,000 workers. For a decade, the Bank had been involved with Tata in a project to spin the plantations off into a separate company. Smitten by Tata's reputation for social responsibility and plans for worker ownership, the Bank had ignored concerns about labour and living conditions. When problems arose, management denied them and the Bank provided cover. The CAO report lifted any remaining basis for that cover. As Wilfred Topno – one of those activists who initiated the CAO process – said of the report, it has validated concerns that workers have been raising for years. In carefully framed but unrelentingly critical language, the report vindicated complaints about poverty wages, dreadful living conditions, and harms from pesticide use. It savaged the Bank for relying on domestic regulation and third party certification. Even more significantly, the report exposed some of the thorniest and most vehemently denied violations of labour rights, union-management complicity and exploitation through a share-plan that was fundamental to the Bank's engagement in the first place. From Colonialism to CSR The tea sector in India began in the late nineteenth century as a public-private colonial project designed to break the dependence on China and provide for growing demand in Europe. Private companies were granted public land to create plantations, the most successful of which were established in Darjeeling and Assam. It is nearly a sin qua non of colonial mass labour projects that local populations, with established economic networks, are not easily drawn into wage labour. As a result, labour had to be recruited, transported, and, then, policed. In Assam, this involved massive displacement of primarily tribal populations, or Adivasis, from the areas that today form Jharkand and Odisha. Uprooted from their land, these populations became entirely dependent on the plantations for their survival, including healthcare, housing, and eventually education. Mobility was limited because of the isolation of the plantations and workers' dependence on 'benefits'. Cash wages were kept extraordinarily low, calculated on the basis of two working adults in each household and in-kind payments of food, housing and health care. It was nearly impossible for workers to build up savings and they had no right to acquire land or housing of their own on the plantation. There were criminal penalties for 'absconding' and collusion among planters insured that there was no variation on wages or conditions among the different plantations. While the criminal penalties are gone, much of the rest remains in place, including the fixed sectoral wage, the dependence on benefits and the extraordinary isolation. After independence, India adopted the Plantation Labour Act (PLA), a progressive law requiring plantations to provide adequate housing, sanitation, health care and education. But active enforcement of the PLA has been sorely lacking. According to Virginius Xaxa, a prominent Indian Sociologist and one of leading scholars in the field, there has been no serious effort to comply with the PLA by either companies or the state since the 1960s. These limitations might be less significant if there were active labour unions on the plantations. But government and planters have successfully colluded to allow the Assam Chah Mazdoor Sangha (ACMS, Assam Tea Workers Union) to maintain a near monopoly since before independence. For workers, it has rarely served as anything other than an arm of management. For most of the last century, these terrible conditions, the corrupt monopoly union in Assam and the failure of the government to enforce the PLA were well documented. But in Assam in particular, companies had little incentive either to improve conditions or deny them. The terms of the debate began to shift in the late 1990s, when Russia stopped buying large bulk quantities of Indian tea after the fall of the Soviet Union, leading to a massive drop in producer prices. More than a hundred plantations...
Read full abstract